Microsoft denies plans for enterprise apps market

Microsoft has no intention of moving into the market for high-end enterprise applications, the company testified yesterday during the court case through which the US Department of Justice (DoJ) aims to block Oracle's $7.7bn takeover of PeopleSoft.

"It is not true that we intend to move in that space," Douglas Burgum, senior vice president for Microsoft's Business Solutions Group, told a San Francisco courtroom.

"Microsoft's strength as a company is in packaged software with low prices and high volume. The two are very different."

The DoJ argues that Oracle's planned acquisition of PeopleSoft will hurt competition in the market for high-end enterprise applications, creating a SAP/Oracle duopoly.

But Oracle claims that there will be plenty of competition from other companies, including Microsoft, which is currently targeting small and mid markets and intends to move up to enterprise-size markets.

Oracle pointed to projects where Microsoft is aiming to sell a large number of software licences to enterprise customers, and to enterprise software projects where the company is competing with Oracle or SAP.

But to underline his aversion of the enterprise applications market, Burgum cited problems with the implementation of Microsoft's Axapta ERP suite at office supplies giant Esselte of Finland, adding that he expected to lose money on it.

To prevent similar problems with software under-delivering, Microsoft is in the process of setting up a Technical Implementations Desk that will judge any proposed sales for large-scale implementations. It is scheduled to be in place by 1 June 2005.