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Ellison Tries To Allay PeopleSoft Customers' Fears

Oracle CEO Larry Ellison sought to quell the fears of PeopleSoft Inc. customers by insisting that PeopleSoft applications would receive the same support that owners of Oracle's own applications receive, if his company succeeds in acquiring PeopleSoft.

"We're going to oversupport PeopleSoft customers," Ellison said Wednesday in a question-and-answer session with conference attendees after his keynote address to Oracle OpenWorld attendees.

Rather than immediately discontinue PeopleSoft applications, Oracle will bring to market version 9.0 of PeopleSoft's software, which is under development. "We'll do as good a job as we know how" to bring PeopleSoft 9.0 applications to fruition, he said.

He conceded implicitly that no further versions of PeopleSoft applications would be produced after version 9.0 because the PeopleSoft engineering staff, if the acquisition were consummated, would be switched over to working on future versions of Oracle applications. For the first time, Ellison said Oracle's next-generation applications would be "a functionality-merged set of products," combining Oracle and PeopleSoft features and supplying a "graceful" upgrade path for both Oracle and PeopleSoft customers.

Ellison claimed that building next-generation applications will require "a greater investment than PeopleSoft could do independently." Oracle's plans to develop such an application set will give the company the competitive means to "go after SAP," the market leader in enterprise-resource-planning applications, he said.

But to do that, Ellison said, Oracle "needs more customers and more engineers," and that's why it has continued to pursue its PeopleSoft bid. Recently, PeopleSoft stockholders tendered 60.8% of their shares to Oracle, but the company may have to stage a takeover attempt of PeopleSoft's board of directors, which has enacted a poison-pill defense against the Oracle bid.

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