Oracle 'hoisted by its own petard' in PeopleSoft setback
Oracle 'hoisted by its own petard' in PeopleSoft setback
Enterprise software maker Oracle was the engineer of its own fate, according to the lawsuit issued by the U.S. Department of Justice against the company, following the decision by antitrust regulators to oppose its takeover bid for rival software vendor PeopleSoft.
Lawyers from the DoJ used the words of Oracle's co-president Charles Phillips to justify its decision to block the takeover on the grounds that it would result in an anti-competitive marketplace.
The DoJ pointed to a report issued by Phillips back in 2002, when he was an industry analyst for Morgan Stanley. In the report, Phillips stated that the back-office market for global companies is dominated by an oligopoly comprised of SAP, Oracle and PeopleSoft, adding that the market is down to those three viable suppliers who will help re-automate the back office business for global enterprises in the years ahead.
This statement directly contradicts the argument Oracle's hierarchy – Phillips and all – put forward in a statement issued last Thursday upon hearing the DoJ's decision. "The Department's claim that there are only three vendors that meet the needs of large enterprises does not fit with the reality of the highly competitive, dynamic and rapidly changing market.
"We believe that the government's case is without basis in fact or in law, and we look forward to proving this in court," said Oracle spokesperson Jim Finn.
While Phillips was not to know at the time that the opinion he ventured on the enterprise software market back then would have such a huge bearing on the fortunes of Oracle, given that he was not an employee of the company when the remarks were made, it is likely he will now be feeling the heat as a consequence of this report being used by the DoJ's lawyers as a stick with which to beat Oracle with.
Related Article: