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Oracle, SAP Continue Power Struggle

SAP AG leads in the $7.1 billion Western European enterprise resource planning (ERP) applications market, but lags behind its closest rival Siebel in the customer relationship management (CRM) market, according to an IDC report released Friday.

SAP rose two percent in ERP market share to 41 percent in 2004, compared with Oracle Corp.'s 11 percent market share ( pro forma, ) which combines JD Edwards and PeopleSoft applications, suggests IDC Corp. in the Western European ERP Applications Vertical Competitive Analysis 2005.

IDC program manager for European enterprise applications Bo Lykkegaard expects SAP to continue its lead in 2006, suggesting SAP will take the Western European ERP market with between 43 percent and 44 percent.

Oracle Corp. spent most of 2005 building momentum to bring in new license revenue as it tried to fill an "empty pipeline" acquired from PeopleSoft in 2004, Lykkegaard said. "PeopleSoft customers would pay upfront license fees and have the freedom to choose among its product lines," he said. "It gives a nice boost to the revenue stream, but problems appear the year after when you have to keep the momentum."

More non-traditional industries, such as financial services and government, are reaching for ERP options because it's becoming easier to deploy. Service-oriented architecture (SOA) platforms and pre-integration reduce complex barriers that inhibit ERP adoption, Lykkegaard said.

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