Oracle 'Fusion' Sounds Good, but Will It Happen?

Now that Oracle's (Nasdaq: ORCL) acquisition spree has ended, the giant database company is focusing on melding the product lines of PeopleSoft, J.D. Edwards and Retek into a cohesive "Fusion."

At a customer conference Wednesday, Oracle released its Fusion roadmap and a few more details on what customers can expect, and while analysts say the plan is a good one, they also say much is still up in the air.

The Right Moves

"Fusion is a smart move. It is a response to the issue of how to get value [both to Oracle as well as its customers] from synergy from multiple code bases," Andrew White, a senior analyst at Gartner (NYSE: IT), told CRM Buyer.

In addition, the company is communicating well with customers. "Oracle seems to be doing a good job talking with customers and getting their feedback as they continue to assimilate the acquisitions," Jason Corsello, senior analyst, Yankee Group, said.

Fusion, Oracle said, is an evolutionary plan to integrate all the companies' products, but without forcing a migration. The rollout will occur slowly over the course of a few years. In the meantime, Oracle will continue to support PeopleSoft products, including Enterprise, J.D. Edwards and World, through at least 2013, as it had promised earlier.

Java-Based

The first product customers will see is Fusion middleware, which will eventually underlie all its applications. Due out in limited release at the end of the year, it will be Java-based and have a service-oriented architecture so that its components can be easily broken out.

While the plan sounds good, White questions whether Oracle can pull it off. "Oracle will have to make Fusion real in order to succeed. To date, Fusion is really nothing other than Microsoft (Nasdaq: MSFT) PowerPoint," he said. "The effort to rationalize huge code bases from disparate environments is a humongous task and one not lightly sought. No one I know has tried and achieved such a rationalization. Worse, while the effort is underway, customers have to figure out if 'support only' is enough to meet their needs and if not, given Fusion is a long way off, how many Oracle customers will leave and go to a competitor to get newer functionality."

Transition Questions

Oracle said it will ease customer transitions through its Superior Ownership Experience -- an almost direct lift from PeopleSoft's Total Ownership Experience -- an initiative to develop best practices for upgrades and migration.

"Despite Oracle's reassurance that Fusion will provide a smooth upgrade, customers are still somewhat skeptically based on past experiences of costly and painful upgrade cycles. Additionally, it still has not been determined how they will integrate and/or leverage the tremendously successful products, such as PeopleSoft's HR applications, where PeopleSoft had built strong value and brand recognition," Corsello told CRM Buyer.

Oracle said it is aiming Fusion at SAP (NYSE: SAP) NetWeaver users, but White said that SAP should not be worried just yet.

"Long term, Fusion should worry SAP, but Fusion is not real. It is hard to compete against a ghost," White said.