30
Sat, Nov
0 New Articles

PeopleSoft Prevails over Oracle

Analysis of News Events
Typography
  • Smaller Small Medium Big Bigger
  • Default Helvetica Segoe Georgia Times

After months of anxious waiting, it finally looks as if PeopleSoft--the enterprise application vendor that acquired J.D. Edwards last summer--can do business without having to fight off Oracle Corporation's hostile takeover bid. Over the last several weeks, a series of events have put Oracle's bid into a coma from which it will likely never awaken. That frees PeopleSoft to put its full attention on its customers, including the thousands of iSeries owners that use J.D. Edwards applications.

It was not long ago that PeopleSoft's survival was in significant doubt. Throughout the second half of 2003, Oracle kept the pressure on the company by urging PeopleSoft investors to tender their shares. It also proposed to shareholders that at PeopleSoft's next annual meeting, they should elect to the board of directors "independent" candidates who would give fair consideration to Oracle's bid. Of course, Oracle provided its own slate of candidates to fill those positions, leaving the outcome of any decision in little doubt.

Despite these efforts, Oracle's bid garnered little interest from PeopleSoft shareholders during 2003. This was partly because the United States Department of Justice (DOJ) was reviewing the antitrust implications of the takeover bid. It was also because PeopleSoft's stock exceeded Oracle's $19.50 per share bid not long after the company announced it. In early February of this year, however, Oracle raised its bid from $19.50 to $26 per share. That increased the cost of the deal to $9.4 billion, an amount that was almost 19% greater than PeopleSoft's market capitalization.

For a few days, it looked as if Oracle's new bid might persuade PeopleSoft's board to approve the acquisition or, barring that outcome, persuade enough investors to tender their shares. After considering the offer for a week, however, PeopleSoft rejected the bid on the grounds that it still undervalued the company. PeopleSoft also urged investors not to cooperate with Oracle. Most investors apparently agreed with the board, as few of them tendered their shares. Then again, the shareholders were probably waiting to see what the DOJ's decision would be before they made any decisions of their own.

That decision was not long in coming. A week after Oracle sweetened its bid, officials within the DOJ recommended that the agency block Oracle's acquisition bid. In response, Oracle CEO Larry Ellison threatened that if the DOJ decided to block the deal, he would ask Oracle's board to fight the government agency in court. Two weeks later, the DOJ and seven states fired back by filing an antitrust suit against Oracle. To add insult to injury, Microsoft lent moral support to the suit by stating that it has no plans to compete against PeopleSoft in its markets over the next two years. This undercut one of Oracle's central arguments in the brief that it filed with the DOJ: that a merger would protect PeopleSoft from the competitive attacks that a monopolistic Microsoft was ready to launch against it.

As a result of the DOJ's legal actions, Oracle did not try to replace PeopleSoft's board of directors with its "independent" candidates at the company's annual meeting on March 25. This gave investors an open field to reelect the existing board and affirm its rejection of Oracle's takeover bid. While it is still possible that Oracle will return to haunt PeopleSoft someday, it will have to prevail first in its battle with the DOJ, not to mention a similar battle that it will likely have to wage with the European Commission. Those legal obstacles make Oracle's bid a dead or at least a rapidly dying effort.

Now that the clouds of fear and doubt are lifting from PeopleSoft's future, the company is shifting its attention to integrating its product lines and creating new solutions and services. Recently, for instance, the company shipped seven connectors that integrate modules in its Enterprise (formerly known as PeopleSoft 8) and EnterpriseOne (formerly known as OneWorld and JDE5) suites. The company has also announced EnterpriseOne 8.10, a new release that brings numerous enhancements to seven modules. PeopleSoft has also stated that it will make selected EnterpriseOne 8.10 modules available on RedHat Linux in May of this year. This could pave the way for a version of EnterpriseOne that runs in iSeries Linux partitions.

PeopleSoft is also renewing its attention to its iSeries-based World application suite. In mid-March, the company announced a new World release that contains more than 250 new features. The release includes enhancements to the product family's Human Capital Management, Manufacturing and Distribution Management, and Financial Management applications, as well as Web-based user interfaces to many of World's 5250 screens. The release is now available free to customers with current maintenance agreements.

While PeopleSoft is getting high marks from many of its customers, some concerns still linger. Among them, perhaps the biggest concern is over the changes PeopleSoft is making to its licensing agreements for EnterpriseOne customers. In January of this year, PeopleSoft started asking EnterpriseOne customers to switch from their existing per-user licenses to "value-based" licenses with unlimited numbers of users. PeopleSoft uses numerous factors to calculate the cost of these licenses, including a customer's size and industry. Unfortunately, some customers are finding that the new licenses could substantially increase their annual fees. This has led to tense negotiations and some rethinking on PeopleSoft's part of its licensing model.

Though it will take PeopleSoft time to understand the needs of J.D. Edwards and iSeries customers, the company has demonstrated that it values these customers and the solutions they use. It has also protected its new customers from a hostile takeover that would have put thousands of companies at the mercy of an IT vendor that has no investment in the iSeries. These facts give J.D. Edwards customers good reasons to look at PeopleSoft's product strategy and invest in its applications with confidence.

Lee Kroon is a Senior Industry Analyst for Andrews Consulting Group, a firm that helps mid-sized companies manage business transformation through technology. You can reach him at This email address is being protected from spambots. You need JavaScript enabled to view it..

LEE KROON
Lee Kroon is a Senior Industry Analyst for Andrews Consulting Group, a firm that helps mid-sized companies manage business transformation through technology.
BLOG COMMENTS POWERED BY DISQUS

LATEST COMMENTS

Support MC Press Online

$

Book Reviews

Resource Center

  • SB Profound WC 5536 Have you been wondering about Node.js? Our free Node.js Webinar Series takes you from total beginner to creating a fully-functional IBM i Node.js business application. You can find Part 1 here. In Part 2 of our free Node.js Webinar Series, Brian May teaches you the different tooling options available for writing code, debugging, and using Git for version control. Brian will briefly discuss the different tools available, and demonstrate his preferred setup for Node development on IBM i or any platform. Attend this webinar to learn:

  • SB Profound WP 5539More than ever, there is a demand for IT to deliver innovation. Your IBM i has been an essential part of your business operations for years. However, your organization may struggle to maintain the current system and implement new projects. The thousands of customers we've worked with and surveyed state that expectations regarding the digital footprint and vision of the company are not aligned with the current IT environment.

  • SB HelpSystems ROBOT Generic IBM announced the E1080 servers using the latest Power10 processor in September 2021. The most powerful processor from IBM to date, Power10 is designed to handle the demands of doing business in today’s high-tech atmosphere, including running cloud applications, supporting big data, and managing AI workloads. But what does Power10 mean for your data center? In this recorded webinar, IBMers Dan Sundt and Dylan Boday join IBM Power Champion Tom Huntington for a discussion on why Power10 technology is the right strategic investment if you run IBM i, AIX, or Linux. In this action-packed hour, Tom will share trends from the IBM i and AIX user communities while Dan and Dylan dive into the tech specs for key hardware, including:

  • Magic MarkTRY the one package that solves all your document design and printing challenges on all your platforms. Produce bar code labels, electronic forms, ad hoc reports, and RFID tags – without programming! MarkMagic is the only document design and print solution that combines report writing, WYSIWYG label and forms design, and conditional printing in one integrated product. Make sure your data survives when catastrophe hits. Request your trial now!  Request Now.

  • SB HelpSystems ROBOT GenericForms of ransomware has been around for over 30 years, and with more and more organizations suffering attacks each year, it continues to endure. What has made ransomware such a durable threat and what is the best way to combat it? In order to prevent ransomware, organizations must first understand how it works.

  • SB HelpSystems ROBOT GenericIT security is a top priority for businesses around the world, but most IBM i pros don’t know where to begin—and most cybersecurity experts don’t know IBM i. In this session, Robin Tatam explores the business impact of lax IBM i security, the top vulnerabilities putting IBM i at risk, and the steps you can take to protect your organization. If you’re looking to avoid unexpected downtime or corrupted data, you don’t want to miss this session.

  • SB HelpSystems ROBOT GenericCan you trust all of your users all of the time? A typical end user receives 16 malicious emails each month, but only 17 percent of these phishing campaigns are reported to IT. Once an attack is underway, most organizations won’t discover the breach until six months later. A staggering amount of damage can occur in that time. Despite these risks, 93 percent of organizations are leaving their IBM i systems vulnerable to cybercrime. In this on-demand webinar, IBM i security experts Robin Tatam and Sandi Moore will reveal:

  • FORTRA Disaster protection is vital to every business. Yet, it often consists of patched together procedures that are prone to error. From automatic backups to data encryption to media management, Robot automates the routine (yet often complex) tasks of iSeries backup and recovery, saving you time and money and making the process safer and more reliable. Automate your backups with the Robot Backup and Recovery Solution. Key features include:

  • FORTRAManaging messages on your IBM i can be more than a full-time job if you have to do it manually. Messages need a response and resources must be monitored—often over multiple systems and across platforms. How can you be sure you won’t miss important system events? Automate your message center with the Robot Message Management Solution. Key features include:

  • FORTRAThe thought of printing, distributing, and storing iSeries reports manually may reduce you to tears. Paper and labor costs associated with report generation can spiral out of control. Mountains of paper threaten to swamp your files. Robot automates report bursting, distribution, bundling, and archiving, and offers secure, selective online report viewing. Manage your reports with the Robot Report Management Solution. Key features include:

  • FORTRAFor over 30 years, Robot has been a leader in systems management for IBM i. With batch job creation and scheduling at its core, the Robot Job Scheduling Solution reduces the opportunity for human error and helps you maintain service levels, automating even the biggest, most complex runbooks. Manage your job schedule with the Robot Job Scheduling Solution. Key features include:

  • LANSA Business users want new applications now. Market and regulatory pressures require faster application updates and delivery into production. Your IBM i developers may be approaching retirement, and you see no sure way to fill their positions with experienced developers. In addition, you may be caught between maintaining your existing applications and the uncertainty of moving to something new.

  • LANSAWhen it comes to creating your business applications, there are hundreds of coding platforms and programming languages to choose from. These options range from very complex traditional programming languages to Low-Code platforms where sometimes no traditional coding experience is needed. Download our whitepaper, The Power of Writing Code in a Low-Code Solution, and:

  • LANSASupply Chain is becoming increasingly complex and unpredictable. From raw materials for manufacturing to food supply chains, the journey from source to production to delivery to consumers is marred with inefficiencies, manual processes, shortages, recalls, counterfeits, and scandals. In this webinar, we discuss how:

  • The MC Resource Centers bring you the widest selection of white papers, trial software, and on-demand webcasts for you to choose from. >> Review the list of White Papers, Trial Software or On-Demand Webcast at the MC Press Resource Center. >> Add the items to yru Cart and complet he checkout process and submit

  • Profound Logic Have you been wondering about Node.js? Our free Node.js Webinar Series takes you from total beginner to creating a fully-functional IBM i Node.js business application.

  • SB Profound WC 5536Join us for this hour-long webcast that will explore:

  • Fortra IT managers hoping to find new IBM i talent are discovering that the pool of experienced RPG programmers and operators or administrators with intimate knowledge of the operating system and the applications that run on it is small. This begs the question: How will you manage the platform that supports such a big part of your business? This guide offers strategies and software suggestions to help you plan IT staffing and resources and smooth the transition after your AS/400 talent retires. Read on to learn: