Despite positive fiscal growth and profitability, Rocela, an independent Oracle consultancy, explains how the software giant is still not addressing genuine customer concerns

Edinburgh, 7 July 2010 - Oracle Corporation’s fourth quarter earnings announcement defied analyst estimates with an impressive execution across its entire portfolio.  Independent Oracle consultancy, Rocela, believes that Oracle’s strong financial performance is impressive, despite evidence that many large enterprise clients are holding back on multi-year investments until Oracle’s product roadmap is clarified. This lack of clarity is compounded by client concerns about the manageability and increasing volume and complexity of Oracle license grants.

In the fourth quarter, Oracle’s revenues grew 39%, to $9.51bn, with Net income rising 25%, to $2.36bn. Oracle also reported a 14% increase in new software license revenue, and gains in operating margin of $406m from Sun’s legacy business. The acquisition of Sun MicroSystems in January this year has had a positive impact, adding $1.83bn in hardware system sales alone.

Martin Mutch, CEO of Rocela commented: “Oracle has quickly ripped out the inefficiencies and cost duplication within Sun and is doing a good job demonstrating its commitment to grow the software and hardware business, however it’s yet to confirm the product roadmap. In our day-to-day advisory engagements with large enterprise organisations, we have seen a reticence to commit to large multi-year Oracle investments – the need for clarity in Oracle’s roadmap is an important factor in their decision making process.“

The lack of certainty surrounding Oracle’s roadmap is compounded by a continuing problem of enterprises not fully understanding their licensing estate. A recent Rocela poll found that 80% of large blue chip companies still don’t have a high level of confidence in their license compliance position. Until organisations fully understand what licenses they have in place, their reluctance to increase investment will continue.   

By understanding their Oracle estate, enterprises not only save money but may assume a more confident position in future negotiations. As a result, they’re able to commit to better buying decisions and higher value, multi-year investments.

Mutch concludes:  “As the market evens out post recession and Oracle’s roadmap becomes clear, we’re hoping to see an increase in customer confidence return to the marketplace with large enterprise organisations making significant investments in Oracle.  In the meantime, end users should use this time to arm themselves with a more comprehensive understanding of their Oracle license position.”