Oracle searches for defectors

Oracle Corp. has announced a bold move that the company hopes will have BEA Systems customers jumping ship to Oracle’s recently released Oracle9i Application Server Java Edition (9iAS JE).

In its new “switch and save” scheme, Oracle is offering BEA WebLogic customers the chance to directly exchange enterprise licences of WebLogic for 9iAS JE. The database giant also says customers who migrate to Oracle from BEA will save up to 50 per cent on their ongoing maintenance and support costs.

John Magee, vice-president of Oracle9i Application Server marketing in Redwood Shores, Calif., said Oracle is offering the service free of charge.

Oracle has helped companies migrate from BEA to 9iAS in the past, and Magee said that expertise gave them the ability to make this offer.

The new application server will compete with both BEA and IBM Corp.’s WebSphere platform, but Magee said the focus of the switch and save program will remain BEA customers. “Primarily on the open systems platforms that Oracle does its business, we see a lot more of BEA there than IBM.

“IBM installations are often on their proprietary platforms…that’s why we’ve really targeted BEA on this go round.”

He added that BEA’s business model is not sustainable long-term, as it focuses on a restricted set of features, and said IT departments are looking for consolidation. “They’ve been charging high prices for what is really a very narrow segment of functionality. When you look at the breadth of middleware, these extended capabilities – that’s what we can bring to our customers.”

To BEA, Oracle’s arguments ring of the same-old, same-old. Eric Stahl, BEA’s director of product marketing in San Francisco, said it has seen these types of offerings from Oracle before, be they targeted programs or promises of US$1 million for people who don’t save money using Oracle.

“Two years ago, I remember having this debate. People said, ‘You don’t have a hardware platform or a database and that’s going to be your Achilles’ heel,'” Stahl said.

But, he added, that wasn’t so. BEA states that it equally transcends all platforms and all sub-platforms, and often that is what companies who have invested in various vendor solutions want.

Stahl said BEA doesn’t see this type of offer having much impact on its customers. “(Oracle is) still a distant third in the market,” he said. “They wouldn’t be giving away a product that was already selling well.”

Oracle’s price point for the 9iAS JE is set at US$5,000 per processor.

Warren Shiau, analyst for Toronto-based IDC Canada Ltd., said Oracle’s focus on a price battle is to be expected.

“The people with the most margin have tended to be BEA and then IBM. Vendors that came in later on, or with products that tend to be more open, have attacked the market primarily with price. Oracle is from that camp,” Shiau said.

He added that cost might not drive adoption as much as Oracle claims.

Instead, Shiau suggested the real threat to BEA and IBM will come from the continuous add-ons that Oracle is giving 9iAS. “The improvements to this product have been large since its introduction,” he said.

Magee said building the application server as a Java-only version was what allowed Oracle to come down in price.

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