Sybase acquisition a 'knee-jerk' reaction to Oracle?

Sybase acquisition a 'knee-jerk' reaction to Oracle?

In the past, there have been compatibility issues between SAP and Sybase, which has led SAP to send business towards Oracle.

SAP’s $US5.8 billion acquisition of Sybase could bring the vendor into an uncomfortable battle with Oracle.

The Sybase acquisition is expected to give SAP greater access to mobile technology, as well as improve its database expertise and feature-set. However, Sybase's database is a less common option for running SAP applications and both have historically had compatibility issues.

As a result, SAP has sent lucrative business towards rival, Oracle.

Director of Oracle and Sybase partner Red Rock Consulting, Jonathan Rubinsztein, claimed those dynamics could change with Sybase's technology coming under SAP's roof.

“90 per cent of SAP implementations run on Oracle databases,” Rubinsztein said. “I see this as a defensive move. SAP is trying to mitigate the risk of Oracle owning the entire database market, but I feel it’s too late – the risk is that organisations that have an SAP solution are also embedded in the Oracle stack, and I don’t see them moving over.”

Even with SAP’s backing, Rubinsztein saw little opportunity to migrate existing Oracle customers to Sybase.

“When you buy a database, you’re buying into a technology stack,” he said. “In the enterprise space, Oracle has a commanding lead on that technology stack, and for SAP to acquire a database, and try to migrate users away from existing Oracle infrastructure, is almost naive.”

IDC senior research manager, applications and services, Alen Tong, agreed customers already operating Oracle databases will not make the switch to Sybase simply on the basis that SAP acquired the vendor.

However, it was critical SAP invested in a platform of its own for applications to run on in the future, Tong claimed.

In the long term, he expected SAP to offer the Sybase database as part of a total packaged solution – especially appealing to its SMB customers.

“SAP has been moving to a total solution offering,” Tong said. “In a way, the acquisition was a reaction to what Oracle is doing – its acquisitions have given it a very strong proposition, but the ERP market is moving to a saturation level, so there was going to be some consolidation in the space.”

According to Rubinsztein, SAP has been slow in the merger and acquisition space compared to its rival.

Oracle’s acquisitions through the global financial crisis included big vendors such as Sun Microsystems, and smaller niche vendors such as Phase Forward and Silver Creek Systems.

In contrast, SAP’s acquisitions have been limited in scope, although it did announce plans to acquire compliance software vendor, TechniData last month.

“It’s also recently undergone a change in CEO and some restructuring. I see this as being almost a knee-jerk reaction to that slowness,” Rubinsztein said.

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Tags OraclesybaseRed Rock ConsultingSilver Creek SystemsTechniDataPhase Forward


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