2005 Review of the Year: Enterprise software

2005 Review of the Year: Enterprise software

As Oracle continued its buying spree in the enterprise software space, the vendor exchanged some carefully aimed punches with SAP.

The most visible confrontation occurred early in 2005. SAP unfolded a $496m plan in February to acquire Retek, a maker of enterprise software for retail clients.

Oracle quickly responded and in March launched a competing offer. A bidding war resulted, and in the end SAP backed down. Oracle eventually paid between $631m and $669m.

The Retek deal was the first Oracle acquisition after the purchase of PeopleSoft. The database vendor had predicted that it would continue its buying spree when it announced the completion of the $10.3bn deal.

Oracle also unfolded its plans for a software suite to allow users of JD Edwards, PeopleSoft and Oracle software to move to a single product called Project Fusion.

The forthcoming suite is scheduled for a 2008 launch and Oracle chief executive Larry Ellison said that he will continue supporting current versions until 2013.

"Some time short of 2013, at a time that is convenient for your organisation, you will upgrade to the merged product," Ellison told worried customers.

SAP saw a ripe opportunity to spread fear, uncertainty and doubt about the forthcoming suite and is focusing its competitive efforts on the future product.

"There is a fundamental problem in the notion of Project Fusion," said Shai Agassi, president of SAP's product and technology group, at a public appearance at the Churchill Club last November.

"If you believe that you can rewrite from scratch every single process for every industry, and do it in less than five years and have less than three years of stabilisation of the code, than you are obviously a banker. To rewrite it from scratch is suicidal."