Oracle pledges JD Edwards support

Oracle has pledged support for users of software made by JD Edwards, which is expected to be acquired by Oracle takeover target PeopleSoft.

Oracle, which launched its hostile takeover bid for PeopleSoft last month just days after PeopleSoft announced a deal to acquire JD Edwards, has promised to maintain PeopleSoft technology for at least 10 years and to not force thousands of customers to use Oracle's competing products.

Oracle has now extended that promise to nearly 6,700 customers of JD Edwards, whose merger with PeopleSoft is expected to complete today.

Charles Phillips, Oracle's executive vice president, said: "Should that [PeopleSoft and JD Edwards] transaction close, and we buy the combined company, JD Edwards [customers] will be treated the same way."

Oracle invited PeopleSoft customers to submit their questions about its acquisition plans via email as part of a virtual "town hall" meeting this week. Phillips, a seasoned Morgan Stanley analyst who joined Oracle in May, fielded the email questions by teleconference. Oracle did not identify who sent the questions.

The meeting was part of an ongoing customer outreach campaign by Oracle to mend relations with 5,100 PeopleSoft customers. Many of them were angered by initial comments from Oracle CEO Larry Ellison about his intention to discontinue PeopleSoft software. Oracle later said it planned to support and update the current version of PeopleSoft's applications, which are used by companies to run accounting, human resources and other key operations, for another decade.

Some PeopleSoft users have expressed doubt that Oracle will stand by that pledge. They also worry about the level of support and maintenance that Oracle would provide for PeopleSoft technology, the cost of moving to another set of applications when Oracle's support runs out, and the lack of competition in a market recast by Oracle. Earlier this week Ellison said customers who buy PeopleSoft business applications "will have bet on the wrong horse" if Oracle's bid is successful.

During this week's question-and-answer session, Phillips sought to counter the sceptics.

Phillips said: "Our public commitment is a good insurance policy. There is no way we’d back off from that. We think we’re on the hook, and we're glad we’re on the hook, because that was part of our plan."

Winning the support of PeopleSoft customers is critical for Oracle as it seeks to prevail in its highly contentious acquisition bid, which is being reviewed by antitrust regulators. PeopleSoft customers concerned about having fewer choices in the business applications marketplace could become central to the antitrust debate that surrounds Oracle's bid. Additionally, the success of an Oracle deal ultimately depends on its ability to retain PeopleSoft's customers.

Phillips said Oracle would maintain partnerships with PeopleSoft's consulting and technology partners, including database partners that compete with Oracle. According to PeopleSoft, 60 per cent of PeopleSoft customers run their applications on Oracle databases, while the rest run largely on databases from Microsoft and IBM. The vast majority of JD Edwards customers run on IBM technology.

Supporting PeopleSoft applications on competing databases would not be an issue for Oracle, according to Phillips. He said: "The important thing to remember is that we are involved in multi-vendor support environments today. There is no partnership we are trying to close down."

Phillips said Oracle would honour existing PeopleSoft customer contracts and support PeopleSoft installation projects still in progress. He also said Oracle does not plan on triggering money-back guarantees that PeopleSoft began offering after Oracle launched its buyout bid last month.

Questioned about Oracle's plans to further develop PeopleSoft technology, Phillips said Oracle would continue to update the software to comply with changing business regulations and requirements. He said: "The product will continue to grow."

Oracle said about 700 callers, excluding Oracle employees, dialled into the town hall teleconference.

Alorie Gilbert writes for CNET News.com