Midmarket strategy, tighter ties with CDW raise channel conflict issues
Oracle aims to extend its application server mantra to the much-wooed midmarket, but it must convince small VARs and ISVs that its plans to hire more app server sales specialists and establish tighter ties with CDW don't represent a conflict.
At Oracle World in London next month, Oracle plans to launch Oracle Application Server 10g Standard Edition, which includes its app server, Web server and portal server, said Tom Kurian, senior vice president of application servers at the vendor. He declined to disclose pricing but said the product will be positioned squarely against Microsoft Small Business Server.
'No matter which component of the suite it is, we are substantially cheaper. We are doing this deliberately .'
--Tom Kurian, Oracle
Oracle also plans separate editions of its portal, Java development tools, integration technology, business intelligence engine and identity management technology. Pricing won't be disclosed until next month, but it will be aggressive as Oracle seeks market share gains, Kurian said.
"No matter which component of the [app server] suite it is, we are substantially cheaper. We are doing this deliberately to seed accounts," he said.
To facilitate the launches, Oracle intends to work closely with its 2,500 active VARs and value-added
distributors such as Avnet. Oracle also is investing in its relationship with CDW, which Kurian sees as a key configuration and logistics partner and an important link to ISVs and custom application developers. CDW also is a key volume delivery partner for OEMs such as Hewlett-Packard, which is increasingly selling Oracle's app server line on its servers, Kurian said. "CDW is the Dell for HP," he added.
Oracle, too, plans to spend $5 million in fiscal-year 2005 to lure application developers.
Over the next year, Oracle executives hope to convert the company's initial forays into the app server market into enterprise license deals. To that end, Chairman Jeff Henley said Oracle will double its number of app server sales specialists to 420, a move certain to raise eyebrows in the channel. Oracle also is tapping internal consulting experts to help customers evaluate their Oracle infrastructures.
"There really is a lot of capability that can be unlocked in terms of driving business objectives," said Don Lovett, managing director for BearingPoint, Service Solutions and Global Oracle Alliance, a close Oracle integration partner. "In our accounts, there are a lot of things they can do with this technology at an incremental cost."