Carpe Diem SAP: Hit Oracle While It's Dazed and Confused

The Hurd hiring tempest is only the latest in a string of reasons why SAP should attack Oracle now, while the getting is good.

It's amazing what several months, some high-profile executive departures and arrivals, a couple of acquisitions and a handful of nasty lawsuits have done to alter the enterprise software market.

Just think back to Super Bowl Sunday 2010: SAP was a mess. Its still new-ish CEO, Leo Apotheker, was forced out, followed by a thorough house-cleaning at the top. Employee dissatisfaction was running rampant at the German ERP giant.

Rather than SAP customers talking about apps, everyone was focused on SAP maintenance and support pricing, which is not a good thing. Competitors old and new were chipping away at its number-one spot in the enterprise apps universe. Revenues, profits and operating margins were all down year over year.

If we could have measured SAP's influence at the start of 2010, the most accurate assessment would have been: waning.

Oracle, on the other hand, was humming right along: Its M&A machine had scooped up Sun (to the embarassment of SAP and delight of Larry Ellison). Unlike SAP, Oracle had become the Teflon Don of software maintenance thanks to its ability to deflect scrutiny by its customers. And Oracle's revenues, profits and operating margins were all up year over year.

That was then. This is now.

It's crazy to even contemplate, but it's almost as if things got too comfortable for Larry & Co., and they needed a shot of tumult. Or did Oracle feel it was being upstaged by all the turmoil at SAP and needed a little corporate angst that would make even Alanis Morissette envious?

How else do you explain the ballooning, occasionally schizophrenic Oracle corporate focus: There's "The Red Stack" mantra, and "Software. Hardware. Complete." line, and Larry wanting Oracle to be "The Next IBM." Never mind that CIOs and their companies aren't necessarily looking for "one-stop shopping" from a vendor conglomerate anymore. The Sun purchase, of course, has delivered mixed results—Sun's struggles are now Oracle's to deal with, sometimes a blessing and sometimes a curse.

Then there's the circus sideshow that former HP CEO Mark Hurd has wrought upon Oracle since his tennis buddy Ellison hired him as Oracle co-president. What was supposed to have been a splashy hire has become a TMZ-like distraction. Tech industry watchers have begun examining "Mark's Mystique," and Hurd's once-omnipotent managerial powers have been brought back down to mortal status.

No doubt, Oracle is going through an identity crisis, as analyst Josh Greenbaum writes in an aptly titled blog post: "Is Oracle An Apps Company that Sells Hardware, or a Hardware Company that Dabbles in Apps?"

Who knows?

What we do know is that King Larry and Oracle are as vulnerable as they are ever going to get.

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