HP, Oracle unveil CRM alliance

The CEOs of Hewlett-Packard Co. and Oracle Corp. took the stage together recently to announce the companies will jointly develop and provide Oracle Internet software for the HP hardware platform.

The companies will link sales staffs via the Internet, marketing and selling across company lines, according to HP’s recently-appointed CEO Carly Fiorina and Oracle CEO Larry Ellison. The wide-ranging deal further includes an agreement that HP will use and sell Oracle’s customer relationship management (CRM) software suite and that Oracle will make e-commerce applications for HP’s version of Unix.

Both regard CRM as a key market. “We are addressing CRM because it’s the fastest growing in the market today, growing three times as fast as the overall market,” Fiorina said.

Oracle also will use HP systems internally for CRM and e-mail applications. HP in turn intends to expand its CRM consulting service to include Oracle software sold for HP systems.

Ellison said the use of CRM is being becoming increasingly important for businesses seeking to expand their operations over the Internet. “By using technology and the Internet and specifically CRM, Hewlett-Packard and Oracle are going after this market together,” Ellison said. “Our marketing, sales and services will all be delivered by HP and Oracle together. Oracle is going to market all CRM software with HP hardware and we’re not doing that with anyone else.”

One analyst said that the alliance broadens the appeal of both companies. “It broadens the dedicated sales channels for Oracle and gives Hewlett-Packard a strong product,” said Peggy Menconi, research director of CRM for AMR Research Inc. in Boston.

“The Oracle suite covers the front and back office applications running on the HP platform,” she noted.

In other HP news, the company disclosed Fiorina’s compensation package for coming to HP in July from Lucent Technologies Inc.

For joining HP, Fiorina will receive restrictive stock and options worth up to US$90 million, HP confirmed. She will also receive a base salary of US$1 million, a US$3 million signing bonus, plus a guaranteed bonus after her first year of US$1.25 million, said Marlene Somsak, an HP spokeswoman. The stock and options replace those Fiorina left behind at Lucent, Somsak said.

When asked at the HP-Oracle announcement how she liked working at H-P since her executive appointment in July, Fiorina said, “Great,” with no elaboration.

Oracle announced several other initiatives, including: certification for its Oracle8i database to run on Red Hat Linux, the open-source operating system packaged and sold by Red Hat Software Inc.; the launch of its FastForward Distribution, ERP software and services, aimed at helping mid-sized wholesale distributors do business online; and the release of a package of software and services, called FastForward Web Store, that will enable mid-sized companies to sell products online.