Is Siebel's great news great for Oracle?

Sarah Lacy

Well, well, well, look who remembered how to sell software! Siebel Systems, soon to be part of the Oracle land-grab, pre-announced a stellar fourth quarter today, with revenues up 20% from last year. That means one of three things: Oracle got an even better deal than anyone thought, now that Siebel's fate is assured customers are more willing to buy--especially at lower support costs than Oracle may charge, or Siebel salespeople are uncertain about their fates and selling like mad. The worst of all three for Oracle is the last one, and it's also the most likely.

Let's say that's 100% of what's going on. Not great for Oracle, but not all bad either, at least in the long term. Yes, it means Oracle will have to rebuild its sales pipeline for a few quarters, just as it had to with PeopleSoft. But what's Oracle really buying with all these deals? Installed base and maintenance revenues and it just got a bunch more with Siebel's flood of new deals, right? And each Siebel deal closed is conceivably a deal that could have gone to SAP if there was great concern about having your account sold to Oracle.

Of course, Oracle has enough to pull off this year without having to rebuild a CRM sales pipeline. But wouldn't it be worse if sales people were knocking themselves out to close deals and no one was buying?

There is of course another possibility. That George Shaheen has really pulled off the Siebel turn around, just a bit too late for the company to stay independent. I wasn't on the conference call but Pat Walravens of JMP wrote, somewhat derisively if I'm not mistaken, about the "victory lap" he took. We all know this quarter was probably an anomaly in some way, but I say take the lap, Shaheen. It wasn't totally his fault that WebVan was one of the biggest disasters in ecommerce history, but he got saddled with the blame there. Maybe Siebel wasn't his redemption, but shareholders are happy and he's going out with a bang. That's worth something.

Before it's here, it's on the Bloomberg Terminal.