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	<title>A Business Application Summation &#187; RightNow</title>
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	<description>Covering the business application software market from industry news to integration to licensing and support.</description>
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		<title>Oracle-RightNow: Expert reactions and the future of the Cloud Services Agreement</title>
		<link>http://itknowledgeexchange.techtarget.com/a-business-application-summation/oracle-rightnow-expert-reactions-and-the-future-of-the-cloud-services-agreement/</link>
		<comments>http://itknowledgeexchange.techtarget.com/a-business-application-summation/oracle-rightnow-expert-reactions-and-the-future-of-the-cloud-services-agreement/#comments</comments>
		<pubDate>Wed, 26 Oct 2011 14:22:25 +0000</pubDate>
		<dc:creator>Barney Beal</dc:creator>
				<category><![CDATA[license negotiation]]></category>
		<category><![CDATA[RightNow]]></category>
		<category><![CDATA[SLAs]]></category>

		<guid isPermaLink="false">http://itknowledgeexchange.techtarget.com/a-business-application-summation/?p=50</guid>
		<description><![CDATA[There&#8217;s been no shortage of takes on Oracle&#8217;s acquisition of RightNow Technologies. Opinions about the motivation and the market impact run the gamut. Mike Fauscette sees it as way for Oracle to bolster its recently-released Public Cloud initiative. He writes: Oracle&#8217;s Public Cloud offering, up to this announcement, was presumed to be composed of existing [...]]]></description>
				<content:encoded><![CDATA[
<div class="topsy_widget_data topsy_theme_blue" style="float: right;margin-left: 0.75em;"><script type="text/javascript" src="http://button.topsy.com/widget/retweet-big?url=http://itknowledgeexchange.techtarget.com/a-business-application-summation/oracle-rightnow-expert-reactions-and-the-future-of-the-cloud-services-agreement/&amp;title=Oracle-RightNow%3A+Expert+reactions+and+the+future+of+the+Cloud+Services+Agreement&amp;theme=blue&amp;order=count,badge,retweet&amp;txt_tweet=tweet&amp;txt_retweet=retweet"></script></div><p>There&#8217;s been no shortage of takes on Oracle&#8217;s acquisition of RightNow Technologies.</p>
<p>Opinions about the motivation and the market impact run the gamut.</p>
<p>Mike Fauscette sees it as way for <a href="http://seekingalpha.com/article/301821-oracle-s-rightnow-acquisition-signals-a-shift-in-strategy-focus">Oracle to bolster its recently-released Public Cloud initiative</a>.</p>
<p>He writes:</p>
<blockquote><p>Oracle&#8217;s Public Cloud offering, up to this announcement, was presumed to be composed of existing Oracle products including Fusion Applications, but clearly now Oracle plans a more aggressive move into the SaaS apps space.</p></blockquote>
<p>R Wang sees some merit to that rationale, but cautions that RightNow, not being truly multi-tenant and therefore not truly SaaS, will require Oracle to deliver a multi-tenant version of Fusion Middleware. And, like many others, Wang saw the move as partly a competitive play against Salesforce.com, but also a <a href="http://blog.softwareinsider.org/2011/10/24/news-analysis-oracle-buys-rightnow-for-1-43b/">longer-term customer experience management move</a>. RightNow has for years given up calling itself CRM and instead focused on branding itself as customer experience management technology.</p>
<p>Wang writes:</p>
<blockquote><p>Social business, online experience optimization, and gamification represent huge holes in Oracle&#8217;s product portfolio.  RightNow brings tremendous amounts of thought leadership to the table should Oracle retain the product teams.  More importantly, the SMB focus will help Oracle bring in a new customer base.</p></blockquote>
<p>Phil Wainwright, on the other hand, rejects the idea that Oracle bought RightNow as a reaction to Salesforce.com&#8217;s acquisition of Assistly. He sees it as <a href="http://www.zdnet.com/blog/saas/rightnow-buy-opens-oracles-saas-gambit/1429">Oracle buying up the SaaS old guard</a>, and offers a lengthy and well-documented take on the multi-tenancy vs. SaaS argument.</p>
<p>Wainwright writes:</p>
<blockquote><p>The choice of RightNow sends further signals about the kind of cloud vendor Oracle will prefer to acquire. Over the years, RightNow has had more than a few critics of its SaaS model, which has been much closer to <a href="http://www.zdnet.com/blog/saas/oracle-stair-steps-to-on-demand/413">Oracle&#8217;s notion of hosting customers in clustered ‘pods&#8217; of servers</a> than <a href="http://www.zdnet.com/blog/saas/many-degrees-of-multi-tenancy/533">more purist definitions of multi-tenancy</a> (<a href="http://www.zdnet.com/blog/saas/why-multi-tenancy-matters/537">of which there are many</a>). RightNow&#8217;s variety of SaaS model is more prevalent than you&#8217;d believe from listening to the hype that comes from the industry. There are large numbers of vendors with similar architectures, and it&#8217;s a tough path they&#8217;ve chosen. As time goes on, I suspect they&#8217;ll find it harder and harder to compete against more technologically and economically agile vendors that more effectively <a href="http://www.zdnet.com/blog/saas/multi-tenancy-why-you-should-care/1131">leverage true cloud architectures</a>.</p></blockquote>
<p>Meanwhile, Beagle Research&#8217;s Denis Pombriant offers a similar reaction to Wang&#8217;s, seeing the <a href="http://denispombriant.wordpress.com/2011/10/24/oracle-buys-rightnow/">long-term potential for customer experience management.</a></p>
<p>Pombriant writes:</p>
<blockquote><p>Seriously though, Oracle, ATG and RightNow might be a thing in the future.  Multi-channel communication combined with e-commerce outreach could be very important.  Add to this Oracle&#8217;s success in what it has called clienteling (sp?) in which store sales associates carry mobile devices that can orchestrate customer centric shopping, and you might see a pattern.  If the customer can&#8217;t come to the store, perhaps the store will come to the customer.</p></blockquote>
<p>The ATG connection is an interesting one. It got relatively little attention in the marketplace when it happened and Oracle&#8217;s CRM executives have cited it repeatedly as a differentiator. Seen through the lens of <a href="http://itknowledgeexchange.techtarget.com/voices-of-crm/is-ibm-delving-deeper-in-to-crm/">IBM&#8217;s Smarter Commerce push</a>, in which IBM is combining its own acquisitions of Sterling Commerce, Unica, Coremetrics and SPSS, software buyers might actually have the luxury of pitting Oracle against IBM once again.</p>
<p>Forrester&#8217;s Kate Leggett wonders how <a href="http://blogs.forrester.com/kate_leggett/11-10-24-more_market_consolidation_with_oracle_acquiring_rightnow_more_questions_asked_than_answered">Oracle will rectify all the overlapping functionality</a>.</p>
<p>She writes:</p>
<blockquote><p>Oracle has many overlapping and competing assets for CRM and customer service as well as for point solutions (e.g., email, chat, and knowledge management). Oracle must position RightNow as a unique offering in its current solution portfolio and must clearly message and steer customers to the right solution for their particular business need (for example, if I am a customer needing knowledge management, do I buy InQuira from Oracle or RightNow from Oracle? What about a chat solution? Do I buy InstantService from ATG/Oracle or from RightNow or the Oracle product?).</p></blockquote>
<p> Of course people were posing those same questions about PeopleSoft CRM, and Siebel. The answers remain elusive. </p>
<p>Leggett raised another interesting dilemma, that of clashing corporate culture. Normally, I wouldn&#8217;t put much stock clashing cultures. They&#8217;re part of acquisitions, people meld or move on, sometimes the acquiring company changes up. Yet in this instance, the two companies could not be more different &#8212; at least based on public perception.</p>
<p>What I wonder is, what happens to the <a href="http://searchcrm.techtarget.com/news/2240016826/RightNow-challenges-SaaS-market-to-provide-clearer-SLAs-fairer-pricing">RightNow Cloud Services Agreement</a>? Think Oracle will continue with sales based on a <a href="http://www.rightnow.com/blog/customer-experience-ideas/cloud-services-agreement">three-year price commitment plus a three-year renewal price cap</a>? What about &#8220;pools of capacity&#8221; similar to wireless rollover minutes? Ramping licenses up based on seasonal demand?</p>
<p>One need only to look at Mark Fontecchio&#8217;s reporting on SearchOracle.com to see questions about <a href="http://searchoracle.techtarget.com/news/2240031826/Has-the-phrase-Oracle-Support-become-an-oxymoron">Oracle&#8217;s commitment to support</a>, <a href="http://searchoracle.techtarget.com/news/2240034885/Beware-the-Oracle-license-audit">Oracle&#8217;s tactics when it comes to license audits</a>, or its less-than-customer-friendly <a href="http://searchoracle.techtarget.com/tip/An-introduction-to-Oracle-licensing-practices">contract negotiation practices</a> to find the likely answer to those questions.</p>
<p>Perhaps one of the most interesting revelations in the wake of the acquisition is the re-surfacing of an <a href="http://www.businesscloud9.com/topic/applications/rightnow-crm-four-letter-word-even-cloud/3783">October 2010 interview with RightNow CEO Greg Gianforte</a> on BusinessCloud9. It seems Gianforte had his own issues with Oracle licensing.</p>
<blockquote><p>&#8220;Let me tell you about Oracle,&#8221; says Gianforte. &#8220;We needed a new accounting system. The one we had was at end of life so we set out to procure a new one. There are really not that many options out there. That German company that makes accounting systems was probably too big for us, so we had a shortlist of Oracle and NetSuite. Now I didn&#8217;t trust Oracle as far as I could throw a stick! We try to keep our data centres an Oracle-free environment.&#8221;</p></blockquote>
<blockquote><p>In fact, RightNow had purchased some Oracle software the previous year, he recalled, but found that in order to scale,  it was necessary to put it onto 30 servers. That resulted in a visit from Oracle&#8217;s compliance people clutching a multi-million dollar tab. In the end RightNow settled for a lower rate of $250,000, but winning price certainty was a pre-requisite for this new accounting system.</p></blockquote>
<p>As Rosemary Cafasso, reporting from the RightNow user conference is already discovering, many <a href="http://searchcrm.techtarget.com/news/2240102519/RightNow-customers-concerned-curious-about-future-with-Oracle">RightNow customers are nervous about their new software provider</a>.</p>
<p>And from the take it for what it&#8217;s worth department:</p>
<p>There&#8217;s <a href="http://www.wunderground.com/US/CO/Colorado_Springs.html">a major snowstorm in Colorado Springs</a> at this moment.</p>

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