Oracle is fighting the IT battles of the last decade and is unprepared for the new era of cloud computing. That’s the claim of former Oracle and PeopleSoft executive Ahmed Limam, who is now an enterprise/human resources technology adviser.
His words came shortly before Oracle debuted its Oracle Cloud strategy, which, rather than being the brand new cloud initiative claimed by many, is essentially a marketing push for the cloud components of its seven-year Fusion programme.
Oracle’s attempt to persuade customers of its various enterprise applications to migrate to Oracle Fusion is meeting with stiff resistance, says Limam.
This is because the cost and resources required to make such a major migration are encouraging customers either to consider alternatives, including competing services from cloud providers, or to upgrade only to the latest iterations of their legacy Oracle software to retain official support.
Those that stick with their current software risk having their official maintenance packages discontinued, he claimed. Some are therefore opting for support provided by third-parties, such as Rimini Street.
The problem with moving to Fusion is that it is more than just a simple upgrade, says Limam.
“When organisations moved from Oracle 11 to 12 they had to engage in a full re-implementation. For Fusion, it is even more of a full re-implementation, because it is based on a different data model and technology from any of Oracle’s legacy products and, as with all enterprise applications, there’s so much that has to be customised. You are talking about a year to get it up and running, and major expense in terms of new resources and new licences.
“You need to license the database and the middleware, and the features or modules that were not part of the initial scope. You need to license the third-party software that you will need for reporting and things like that. This is very complex and you do all of this, why? Just because Oracle isn’t supporting PeopleSoft version 8.3 anymore?” says Limam.
Compounding the problem, says Debra Lilley, president of the UK Oracle Users’ Group (UKOUG), and Oracle alliance director at big systems vendor Fujitsu, is that an upgrade to Fusion has to involve everything – even if all the user really wants are the updates to continue running payroll.
“I don’t think people would mind so much about upgrading if the cost of such a project were not so expensive. The products have got so big that upgrading has become a large project,” says Lilley.
Oracle itself also raised expectations when it introduced a “lifetime support” package in the mid-2000s to re-assure its newly acquired customers: quite apart from the strict technical strings attached to that support, she says.
When the company offered just five years of support before customers were expected to upgrade there was much less debate. “In those days, there wasn’t quite such a squeeze on IT budgets and you factored in that you had to upgrade after five years. Now, because of the extra flexibility, it becomes a real business decision when to upgrade, and it’s much more difficult for IT to get the budget to do that,” says Lilley.
And with the budget required to upgrade to Fusion akin to a new rollout, rather than an upgrade, that means the decision needs to go all the way to the top of a company – where tough questions will inevitably be asked, especially in the current climate.
As a result, dissatisfaction with Oracle’s support and maintenance has risen. According to a November 2010 survey by Computer Economics, 42 per cent of Oracle customers are either “dissatisfied” (35 per cent) or “very dissatisfied” (seven per cent), with dissatisfaction greatest among customers of PeopleSoft’s software (http://bit.ly/b4fO2Y).
“A further problem is that a lot of those customers had initially selected PeopleSoft, Siebel or Hyperion against Oracle. Now they have found that the investment that has already cost them millions in licensing, implementation and maintenance is worth nothing because they are going to be obliged to switch to an Oracle product – Fusion,” says Limam.