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Oracle Buys NetSuite- So What?

Posted by John Hughes | 8/9/16 5:28 PM

When Oracle announced its acquisition of NetSuite, did it signal a sea change in how they are going to compete in the cloud space? It is true that with powerhouse Oracle standing behind NetSuite, they have instantly become financially viable and ready to play at the varsity, or Enterprise/Fortune 500 level. But still unclear are Oracle’s ultimate motivations. Is this just a land grab; an easy way (if you call $9.3 billion easy) to get $900 million in cloud revenue or is it a signal they are about to start kicking their competitors, like Salesforce and others with fresher technology in cloud computing, to the curb? Was their assertion they will be the first company to have $10 billion in cloud revenue merely a jab at Salesforce, or are they making a move? And as ManageForce is the only IT partner strategic to both Oracle and NetSuite, we are particularly interested in the outcome.


It is easy to see the parallels between this Oracle acquisition and the one they made nearly ten years ago when they purchased PeopleSoft, who owned JD Edwards. Then, like now, there was talk of a land grab, and questions regarding how to make that purchase profitable. And ten years later here we are, a profitable, growing JD Edwards and NetSuite-focused business. In the case of the PeopleSoft acquisition, like now, there are co-existing products that have different relevance in the market and different customer demands, and those will thrive as PeopleSoft/JD Edwards did. And then, as now, there is not a clear picture of what that market relevance and customer demands will be.

 

NetSuite is a tremendous company and a great fit for Oracle. The partnership between a mature, 18 year-old company with strong offerings for mid to large companies and a robust 30,000 customers, combined with the brand marketing muscle, confidence and credibility of Oracle does not strain credulity. Oracle, while not especially known for its cloud computing solutions, has been gradually improving their offerings. They have a legitimate and competitive set of cloud applications, but they need to offer the market more proof of the capabilities of those applications, specifically Cloud ERP.

 

At ManageForce we see a variable demand for Oracle’s Cloud ERP. We are not the only barometer of this market, but it is telling that this product does not come up as frequently in a CIO or CTO discussion of solutions, as does longer-standing Cloud ERP providers like Workday, NetSuite, and others. But now we no longer have to offer our clients “This, That, or NetSuite” but simply, Cloud Applications by Oracle. This is an exciting turn of events. Now, every solution we offer can be in the cloud, riding the cutting edge of the best technology around.

 

The longer term outcome of this merger is still being written, but what it does demonstrate is the proven leadership of NetSuite which has taken 18 years to develop the broadest and longest standing cloud-based ERP; a truly desirable product and company. It also shows the leadership and commitment of Oracle in the cloud computing space. In addition to delivering on their own cloud products, they are, once again, investing in the future by acquiring a company that is both first and one of the best in market. ManageForce, as the only IT partner strategic to both Oracle and NetSuite, is looking forward to the exciting change this will undoubtedly bring to the market for our customers.



NetSuite Cloud ERP

Topics: NetSuite

Written by John Hughes

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