IBM Partners: Will Oracle Displace DB2 And WebSphere?

The big question that IBM PeopleSoft partners are grappling with in the wake of the Oracle-PeopleSoft merger is whether Oracle will attempt to displace IBM's DB2 and WebSphere platform with its own competing product set.

Evan Walters, president and CEO of Innovative Information Solutions, a Waterbury Conn. IBM partner, said he expects Oracle to eventually integrate its own database and applications server with the PeopleSoft JD Edwards products. That said, he noted, a database and application server decision is a long term one that will not be handled lightly by either VARs or customers.

"Does Oracle want the database and applications server business? Absolutely," said Walters, an IBM infrastructure partner that was named one of only eight PeopleSoft infrastructure partners in the US earlier this year. "PeopleSoft is such a robust application, that it is going to be a long term strategy that is going to be carefully looked at before anyone makes any snap decisions about what they are doing with the database or the applications server.

Walters pointed out that even though DB2 and WebSphere are integrated with PeopleSoft, the Oracle database is still an option. The Oracle-PeopleSoft merger could even eventually mean a much closer relationship between IBM and Oracle as IBM moves to serve the many PeopleSoft customers running the Oracle database on IBM systems, he said. "It's not all about the database," Walters said, noting that IBM is not going to turn its back on that business.

Walters said it is too early to tell how his vendor partnering strategy will change as he comes to grips with the Oracle PeopleSoft deal. "I have to let this whole thing sort itself out and listen to which way the drums are beating and figure out how I make sense of my new status as an Oracle partner," he said. "What does that mean? How do they embrace us and am I going to get traction?"The Oracle PeopleSoft deal comes only six months after PeopleSoft announced that it was working with IBM to identify several hundred IBM partners it will bring on board in the US as part of a channel offensive.

Reacting to the Oracle PeopleSoft deal, Mark Hanny, IBM's vice president ISV Alliances and Go To Market, stressed clients are not likely to rip out current DB2 or WebSphere infrastructure.

Noting that IBM Global Services was recently named Oracle partner of the year, Hanny said IBM is taking a wait and see attitude on how the deal affects its PeopleSoft partners. "It remains to be seen what will happen longer term with the partnerships," he said. "We work with a whole host of people in the marketplace. Where customers are working with us we will continue to work with them. It really comes down to what the customers say. There is a whole host of really good business application providers in the market and we'll continue to work with them to go to market to better serve customers."

"What IBM continues to do is look how we can best solve customer problems," said Hanny. "Another thing we look at is how do we give the best return to our shareholders. If you look at our core competencies, our core competencies are coming in and helping customers solve problems and providing solutions from a consulting, implementation and ongoing relationship with customers."

Hanny said the Oracle PeopleSoft deal points to the difference between Oracle which is moving to aggressively provide business applications, while IBM has made a strategic decision to stay out of the applications business and embrace a broad set of ISV partners. "We think the Oracle strategy is a flawed strategy because there is no one vendor that can provide all the right applications to solve everybody's needs," he said.The small medium business applications market is particularly fragmented and diverse with many clients demanding local partners that can provide hands on, customized applications for a specific industry, said Hanny. "They want someone who builds an affordable solution for them and someone who knows their business and can custom tailor it for them," he added. "They don't want to buy a vanilla, off the counter product."