SAP


John Wookey now works for Oracle's archrival SAP

Last night, rumors began spreading that John Wookey, the former head of applications development at Oracle, has accepted a new post at Oracle archrival SAP. Today, SAP confirmed the news. Wookey, who left Oracle 13 months ago for reasons that the company has never disclosed, is now Executive Vice President of Large Enterprise On Demand at SAP. In his new position, Wookey will play a critical role in crafting the software as a service (SaaS) capabilities of SAP’s flagship products. That, by extension, will affect how SAP competes with Oracle for enterprise accounts.

According to an SAP spokesman, Wookey began work at the German software giant this Monday. He is reporting to Jim Hagemann Snabe, a member of the company’s executive board who is responsible for development of its SAP Business Suite applications and NetWeaver middleware products. In a statement issued today, SAP said that “Wookey will work with several of our large enterprise on-demand solution offerings (including SAP CRM on-demand solutions) and develop more relevant on-demand offerings. It is our aim to unite these offerings with a singular strategy for increased innovation and enhancement under Wookey’s leadership.”

As this quote indicates, SAP intends to get much more serious about creating a compelling SaaS strategy for large enterprises over the next several years. Does this mean that SAP will unveil a comprehensive hosted product for enterprises similar to its Business ByDesign for mid-sized companies? I sincerely doubt it, as the scope and complexity of such a product would make it ill suited for delivery via a 100% SaaS model. What is more likely is that SAP will, over time, move Business Suite to a hybrid “software plus services” model in which new capabilities are delivered via the Internet cloud. This model, which is similar to the one that SAP ally Microsoft is pursuing, could make it easier for Business Suite users to deploy new functionality.

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Conspiracy at SAP?
Conspiracy at SAP?

If you think that Oracle is going to back off from its lawsuit against SAP’s TomorrowNow subsidiary just because SAP is shutting the organization down, think again. A few days after SAP announced the shutdown, Oracle added fresh allegations to its lawsuit that SAP’s top brass knew TomorrowNow was operating illegally before they acquired the third-party maintenance firm. The revised lawsuit also accuses SAP board members and top executives of conspiring to cover up TomorrowNow’s illegal activities. The suit even claims that the German software giant gave the cover-up a name — Project Blue — replete with presentations that came with instructions to “delete after reading”.

Before I comment further on this story, let me make it clear that the following statements are pure conjecture on my part. That said, is it just a coincidence that Oracle filed this amended lawsuit several days after SAP announced it is shutting down TomorrowNow? I doubt it. While neither Oracle nor SAP has said a word to us about the lawsuit, it would be reasonable to conclude that Oracle’s attorneys have been gathering evidence for the new allegations for some time. They would certainly have had good reasons to do so. If SAP deep sixed TomorrowNow, Oracle would need to quickly marshal evidence that the wrongdoing was not limited to TomorrowNow (something that SAP has steadfastly maintained) but reached all the way up into SAP’s management. That would be the only way to keep the legal fires burning under the case.

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On Monday, SAP informed the IT world that it will “wind down” the operations of TomorrowNow, its subsidiary that provides third-party support for Oracle applications. The announcement ends a bold experiment on SAP’s part that blew up in its face. Unfortunately, the fallout from the explosion will put over 200 TomorrowNow customers — including many JD Edwards users — through the pain of having to find new support providers.

According to SAP sources, the software vendor plans to shutter TomorrowNow before October 31 of this year. Undoubtedly, the actual shutdown date will be partly determined by how long it takes the subsidiary’s 225 customers to return to Oracle support or choose another maintenance vendor. SAP spokespeople say that they are already assisting customers in transitioning to new providers. While Oracle will undoubtedly get the bulk of the accounts, it is likely that third-party support providers such as Rimini Street will also win significant numbers. Indeed, Rimini Street has posted a “Welcome TomorrowNow Customers” page on its web site that advertises its 50 percent savings off Oracle support prices.

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While the JD Edwards Advisor strives to provide comprehensive news and analysis to our readers, we also like to have a good laugh. That’s why we post the occasional picture or video that gives us a chuckle, even if it pokes fun at our own foibles or (heaven forbid!) at Oracle itself.

The following video from a group inside SAP definitely fits in the latter category. Its sheer campiness, not to mention the fact that it comes from a firm with a reputation for seriousness, makes it particularly funny. I hope you enjoy it as much as we did.

Do you have any videos or pictures that are worthy of being hung in our Software Hall of Humor? If you want to nominate something, send me an email with a link to (or attachment of) your candidate. If we post your submission, we’ll be sure to give you credit for it.

Last week, Oracle quietly posted an updated price list for its database and middleware products on its corporate web site. As a comparison of the updated list with last year’s list reveals, most prices rose by between 15 and 20 percent. While Oracle did reduce prices on a handful of products, the widespread price increases could motivate some JD Edwards customers to rethink their software procurement plans.

The price increases apply to nearly all database and middleware categories in Oracle’s growing product portfolio. That includes the vendor’s flagship Database Enterprise Edition, which now costs $47,500 for a processor license versus $40,000 two weeks ago. That’s almost a 19 percent increase. Oracle also boosted prices on most of its business intelligence products. For instance, Oracle BI Server Enterprise Edition now costs $51,800 per processor, a 15 percent increase.

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I have half a dozen news items sitting on my desk that are too small for an article, but too interesting to ignore. That happens a lot around here at the JD Edwards Advisor. So here’s what I’m going to do. Every once in awhile, I’ll group the best items into a single column. In keeping with my promise, here are this month’s tips, traps, and tangents.

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When IBM announced i5/OS V6R1 late last month, it also unveiled a complete repackaging of its application development tools for the System i. That could have a significant impact on JD Edwards sites, as many World and EnterpriseOne shops use System i development tools. To learn more about the repackaging, check out IBM’s new web site on the subject. Then, read an analysis of the repackaging from Joe Pluta, a System i development tools expert.

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donald-daffy-w-caption.jpgLast week, a U.S. District Court judge laid out the ground rules for Oracle’s lawsuit against SAP over the alleged theft of Oracle’s intellectual property by SAP’s TomorrowNow division. Those rules are sure to annoy both companies, as neither of them got everything that they wanted from Judge Jenkins.

If I were to pick one company that is more annoyed at Jenkins’ decisions, I would have to pick Oracle. Earlier this year, the software giant told the court that it needed at least 80 depositions and an 18-month discovery period before the trial could start. That would have put the trial clear out into September 2009. In response, SAP argued for only 20 depositions and a trial that would begin as early as September 30, 2008. Jenkins sided with SAP on the number of depositions by limiting them to 20 per side. As for the trial date, he split the difference between the two companies by setting it at February 9, 2009.

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Last week, SAP unveiled an entirely new line of applications that represent the company’s first foray into the “software as a service” (SaaS) market. As the world’s largest enterprise application vendor, SAP has the potential to take the SaaS market by storm with its latest offering and challenge Oracle in a new product segment in the process. However, it will take years of work and a little luck for SAP to become a leading SaaS player.

The new applications, known as SAP Business ByDesign (or BBD for short), took four years and roughly $400 million for SAP to build from scratch. By starting from a clean slate, SAP was able to design BDD using a “no compromises” service-oriented architecture (SOA). While the applications are new, they run on SAP’s existing NetWeaver middleware platform and leverage its support for SOA. Like similar products from Salesforce.com, NetSuite, and other SaaS vendors, BBD is only available as a hosted offering.

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While some industry observers are wondering whether Oracle can keep growing at its torrid pace, the company is showing no indications of slowing down. Last week, the software giant announced quarterly earnings and revenue that exceeded the forecasts of financial analysts. Oracle also reported exceptionally strong growth in sales in its applications group, of which JD Edwards is a part.

In what has become something of a tradition, Oracle chalked up financial figures last week that closed the distance between it and its archrival SAP. For the first quarter of its fiscal year 2008, the company announced that its net income grew by 25 percent to $840 million. In similar fashion, revenues grew by a strong 26 percent to $4.5 billion. By contrast, SAP grew its net income by 8 percent and revenues by 10 percent in its most recent quarterly report.

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Last week, SAP filed its much-anticipated response to Oracle’s lawsuit that accused the German company’s TomorrowNow subsidiary of stealing thousands of proprietary documents and software code from the Oracle Customer Connection web site. While the response admitted to some wrongdoing on TomorrowNow’s part, it also indicated that SAP will fight Oracle if it tries to ban TomorrowNow from accessing Customer Connection. That position could set the stage for a long and bitter legal battle between the two software giants.

In the 20-page document that it filed with the U.S. District Court, SAP admitted that some TomorrowNow employees made “inappropriate downloads” from Oracle’s site. At the same time, the company insisted that TomorrowNow has the right to download content from the site on behalf of its customers. In addition, SAP stated that any illegally downloaded content stayed on TomorrowNow’s systems and never found its way onto SAP’s servers.

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ronald-arrested.jpgIf the claims that Oracle makes against SAP in its 44-page lawsuit turn out to be the gospel truth, SAP’s TomorrowNow subsidiary engaged in a massive effort to steal intellectual property from Oracle’s Customer Connection web site. While that would be deplorable, it would be equally laughable. Why? Because if TomorrowNow’s employees did rob Oracle blind, they left dozens of clues that they did the deed. That has me wondering whether TomorrowNow wants to get its 15 minutes of fame on the Stupid Criminals web site.

Crooks or Clowns?

Allow me to offer some allegations from Oracle’s lawsuit that would demonstrate, if they are true, how stupid TomorrowNow’s employees were. According to Oracle…

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This morning, the bitter competition between Oracle and SAP took a new and decidedly nasty turn. Oracle filed a lawsuit with the U.S. District Court that alleges SAP and its TomorrowNow subsidiary have stolen “…thousands of proprietary, copyrighted software products and other confidential materials” from its password-protected Customer Connection web site. Oracle also alleged that SAP and TomorrowNow stole the materials so that it could offer cut rate support services to customers who use Oracle software and attempt to lure them to SAP’s applications.

The Great Customer Connection Heist?

According to the lawsuit, Oracle noticed at the end of November 2006 that there were unusually high levels of downloads taking place from the Customer Connection web site. As all JD Edwards users who are on Oracle software maintenance know, Customer Connection is a central repository for updates, bug fixes, patches, and a wealth of technical tips and higher-level information. It represents billions of dollars of investment on Oracle’s part, not to mention the investment that the JD Edwards team has made in EnterpriseOne and World materials.

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Over the last couple of years, a number of JD Edwards customers have asked me whether it makes sense to consider migrating to SAP applications. In most cases, these customers are OneWorld Xe users who have heavily customized their software. They want to take advantage of the new functionality in current EnterpriseOne releases, but shudder at the thought of the work they’ll have to do to migrate their customizations. That leaves them (and often their CEO) asking me, “Since it will probably take as much time to migrate our customizations as it would take to migrate to an entirely different application, why shouldn’t we consider jumping boat to SAP as a second option?”

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