Significant Industry Announcements, With Commentary

By Geoffrey James
CA announced the availability of usage-based pricing for SME customers. The new pricing mechanism bases licensing costs on measured system usage rather than total potential hardware capacity. Customers can establish licensing costs based on measured levels of usage, enabling them to increase usage as needed to support growing demand. The program also allows SMEs to move forward with mainframe upgrades more cost effectively since their software costs don’t increase until the added capacity actually is utilized.
Our take: Overall, CA is faced with a crisis in confidence due to recent problems in its management ranks. The company is taking steps to retain its customers as it begins to move slowly forward to consolidate its hodgepodge of products and come up with something that has major market appeal.
 
Microsoft and IBM announced an agreement to resolve antitrust issues between the two companies, settling claims arising from the United States v. Microsoft antitrust case in the mid-1990s. Under the agreement, Microsoft will pay IBM $775 million and extend $75 million in credit toward deployment of Microsoft software at IBM.
Our take: IBM finally figured out that it makes more sense for the world’s largest hardware and services vendor to start working more closely with the world’s largest software vendor. It’s only a matter of time before IBM figures out that its last remaining Microsoft competitor, Lotus Notes, is a complete dead end for all intents and purposes.
 
Microsoft announced the acquisition of Sybari Software, which makes software that’s intended to help corporations protect their messaging and collaboration servers from viruses, worms and spam. Sybari products provide protection for messaging and collaboration servers, helping to stop malicious software and spam before they affect business operations.
Our take: The world is plagued by viruses, worms and spam because Microsoft’s operating systems were designed and implemented using a client/server model that was intended for internal use within a corporation, rather than part of an open environment. All the patching and special products in the world can’t fix the security problems in Windows because they’re an integral element of the architecture.
 
Oracle announced it is offering the Oracle E-Business Suite to SAP R/3 customers who are faced with having to relicense and reimplement their applications to upgrade to mySAP ERP or mySAP Business Suite. Under the new program, Oracle will offer SAP R/3 customers up to a 100% license credit for moving to its E-Business Suite, according to a company press release, in the hope of getting customers to switch from SAP to Oracle applications.
Our take: Talk about aggressive! Oracle is promising free software licenses to anyone who wants to convert to Oracle from SAP. Of course the software license likely will be a tiny percentage of the actual effort to convert but, hey, free software is free software. Watch for SAP to respond with a price reduction of its own.
 
SAP announced it has attracted the talents of senior executives formerly employed by competitors including Richard Campione (Seibel), Mike Mayer (Oracle), Nimish Mehta (Siebel Systems), Doug Merritt (Quest), George Paolini (Borland), Dan Rosenberg (Oracle), Gordon Simpson (BEA Systems), Bob Stutz (Siebel Systems) and John Zepecki (PeopleSoft aka Oracle).
Our take: You steal my customers I steal your executives. SAP is positioning the hiring as a sign of SAP’s strength as a vendor. Maybe. The top executive who hired these execs, Shai Agassi, is pretty bright (we interviewed him some years ago) but one wonders whether so many execs from so many different companies might have problems adapting to SAP’s somewhat straight-laced corporate culture.