Decoding Oracle's Latest Fusion Update

I got a call on the way to a recent Oracle Fusion briefing from Oracle analyst relations. SAP had apparently put out a bulletin in advance of the Oracle event that, in addition to offering pre-emptive rebuttals of what Oracle was going to say, offered me up as an independent analyst ready to talk, to quote the bulletin “about Oracle’s lack of progress in the applications space.”

"Did I know anything about this?" Oracle wanted to know. No, I replied, I was planning to form my opinions after the event, despite SAP’s eagerness that I do otherwise.

Sometimes being an analyst can be very entertaining.

So now that the event is over, it’s safe to say that SAP’s opinion of what I was ready to say was a little excessive. I do think that Oracle has made progress in its applications – lord knows if it hadn’t it would be quite the laughingstock. But do I agree with Oracle co-president Charles Phillips’ statement that Oracle is “half-way to Fusion” – “the tough half,” as Phillips put it? Now it was Oracle’s turn to be excessive.

Half-way in one year – that’s how long it’s been since the PeopleSoft acquisition – would mean that Oracle is one year away from being finished, especially if the tough half is already done. And clearly, as the timeline that apps vice president John Wookey showed later in the briefing highlighted, there’s a lot that won’t be happening by the end of this year.

Just to clarify the “half-way” issue: Oracle is still sticking to 2008 as the delivery date for the Fusion suite. So we’re more like a “quarter-way” there, if the company is able to meet its own deadlines. And that’s the zillion-dollar question.

I’m still very pessimistic about these dates, mostly because I still see a lot of unfinished business that I’m not sure can be resolved in time. One of the main issues is CRM: with the Siebel acquisition still not closed, it’s hard to imagine that Fusion CRM, and the all-important customer record and vertical functionality that are supposed to be coming from Siebel, will also be delivered in this 2008 timeframe.

Then there’s all those yet-to-be-acquired vertical applications that are supposed to propel Fusion into serious competition with SAP’s vertical functionality. I’m not sure how you can deliver by 2008 something you haven’t even tried to buy, much less integrate. Call me negative, but it’s hard to imagine that Oracle is anywhere near half-way to its stated goal of a broadly verticalized product suite.

What Oracle has done is moved forward in branding its Fusion Middleware stack, and there seems to be serious progress in defining what the composite applications development and deployment experience will be. This should come as no surprise: Oracle’s strength in technology is decades old, and well-earned.

But, according to this applications bigot, the real prize comes from rolling out a suite of industry-leading applications, based on a model-driven, process-based, SOA architecture. And if Oracle is really already half-way done with the applications that it hopes will challenge SAP, then SAP is going to continue to hold the upper hand. The half-way that Oracle was able to show at the Fusion event wasn’t strong enough to give it the lead that Oracle is vying for in applications.

Or is taking the lead not the goal? Making inferences based on what isn’t said can be dangerous, but Charles Phillips’ closing remarks seemed telling. Phillips laid out his vision of what Oracle will look like in 2010, and missing from the list was any notion of enterprise applications market leadership, much less the market dominance that we would expect to be the only acceptable position for Oracle and Larry Ellison. Phillips made it clear that the company expected to be a market leader in key vertical industries, but no mention was made of dominating enterprise applications. Is this a new twist on the Oracle saga? Or just a miscommunication on Phillips' part?

We’ll have to wait to find out…I think that’s analyst relations on the line right now. With my luck it won’t matter whether it’s Oracle’s or SAP’s AR team calling, after reading this column they’ll both be mad at me. As I said, sometimes being an analyst can be very entertaining.