Oracle tries to heal rift with applications user group

18 January 2002 After almost eighteen months of acrimony between software giant Oracle and the independent Oracle Applications User Group (OAUG), the two are finally starting to patch up their differences.

At the Oracle AppsWorld conference in Amsterdam this week, OAUG’s president Jeremy Young outlined how he expects to see “some level of support” from the company during 2002. However, relations between the supplier and the user group, though improving, remain “difficult”, he added.

The dispute between the two parties erupted during 2000, when Oracle unilaterally decided to snub OAUG events in favour of its own applications-focused conferences around the world. The OAUG, said Young, was asked to cease its own conferences and lend its support to the Oracle managed events.

However, the Oracle customers on the board of the OAUG rejected the proposal on the basis that the value of their conference programme rested in its independence from the vendor.

“It is vital for our members to hear an independent voice. It is the basis for their confidence in us as an organisation that we provide a forum where they will learn about both the good and the bad in Oracle’s products,” said Young.

In response, Oracle withdrew its support for the Fall 2000 OAUG conference even though in previous years it had provided speakers and organised and managed training sessions for users, as well as running the software demonstration area.

A year ago, Young felt that the situation between the 2,000-strong OAUG and Oracle had reached an impasse. However, in the last few months the two parties have tried to move closer, “although we are proceeding with caution,” he said.

Oracle has started sending select executives to OAUG events and the user group was asked to address this week’s AppsWorld conference, having a selected a fifth of its content.

Oracle CEO Larry Ellison has agreed that the relationship is improving, but is dismissive about the problems between the two parties. “It was uncomfortable. There was a lot of silliness. People’s feelings got hurt,” he said.

“We never had a problem with the OAUG membership, just its leadership,” added Ellison. Nevertheless, he says, Oracle “is reliant on the OAUG for many things: Their insights, their references and their goodwill.”

Ellison claimed that, far from wishing to undermine the influence of the OAUG, for him, the matter was one of logistics. “The OAUG wanted their own conferences. We wanted our own. [But] six conferences all over the world, every year, that’s crazy. Why not combine them? Why should I have to pull my guys out of writing software to send them off around the world six times a year?” asked Ellison.

In recent months, Oracle has made several major concessions in order to establish more friendly relations with its user base. Under pressure from the user group, the company announced in October 2001 that it would extend support for customers running an older release of its applications suite (version 10.7) until June 2003, a six-month extension on the previous cut-off point.

And at this week’s Oracle AppsWorld conference, Ellison unveiled a new pricing structure for the 11i application suite after widespread customer criticism of its complicated pricing structure.

Under the new pricing regime, so-called “power” users will pay a $4,000 licence fee per user for the entire application suite, while “casual users” will pay $400 each. Several analysts have said that this amounts to a price cut designed to make Oracle’s applications more competitive against PeopleSoft, Siebel and SAP.

Avatar photo

Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

Related Topics