HP Rumored to be Ditching Oracle-Siebel for Salesforce.com

By Tracey E. Schelmetic November 23, 2010

In the CRM world today, there may be good news for one major player, and not-so-good news for another. Hewlett Packard is reportedly getting ready to sign an extensive deal with cloud-based CRM provider Salesforce.com for 35,000 to 40,000 seats. Good news for Salesforce.com. So who gets the not-so-good news? Oracle Siebel, HP's current CRM provider.

According to International Business Times, Oracle is not taking the rejection well. “HP is completely shutting down Oracle Siebel, which contacts tell us has made Oracle very furious,” said Trip Chowdhry, an analyst at Global Equities Research. “Contacts tell us that by moving to Salesforce, HP may be saving 40 percent to 50 percent over Oracle Siebel,” added Chowdhry, citing reliable sources for the information.

Chowdhry also stated that Salesforce hopes to finalize the deal with HP before its annual Dreamforce conference, the company's cloud computing event that will take place between Dec. 6 and 9, in San Francisco. Sources have speculated that if Salesforce manages to sign contracts before the event, an executive from Hewlett-Packard will deliver the Dreamforce 2010 keynote address. HP CEO Leo Apothekar is also rumored to be planning to attend Dreamforce.

Though the enterprise business software community generally labels Oracle's Siebel as the more sophisticated solution, it's also generally considered to be more complex to use and harder to train employees on. Salesforce.com is usually cited as the solution with better graphics, more user friendliness and a more intuitive, easy-to-use graphical user interface.

The news will no doubt completely break what was already a strained relationship between Hewlett-Packard and Oracle. Relations between the two companies have declined rapidly in recent months. Early in November, HP sacked its CEO, Mark Hurd, who is a friend of Oracle CEO Larry Ellison, The firing came after allegations of misconduct on Hurd's part, prompting a war of words between HP and Ellison. Hurd was then hired by Oracle.

Salesforce.com recently reported a strong third quarter, with revenue up 30 percent from the same quarter last year, and Chairman Marc Benioff predicted that the company will likely reap $2 billion in revenue in 2012.

Oracle purchased Siebel in 2006.

Tracey Schelmetic is a contributing editor for TechZone360. To read more of Tracey's articles, please visit her columnist page.

Edited by Tammy Wolf

TechZone360 Contributor

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