What Microsoft, Oracle, IBM, And SAP Don't Tell Customers

 

Image: AP MSFT Nov 21 09:57 PM 25.00 Change -0.30 % Change -1.19% IBM   Nov 21 09:57 PM 181.52 Change -3.72 % Change -2.01% ORCL  Nov 21 09:57 PM 29.91 Change -0.69 % Change -2.25% SAP  Nov 21 09:57 PM 57.91 Change -0.65 % Change -1.11%

The four big software vendors -- Microsoft, Oracle, IBM, and SAP -- have hidden motives that customers need to understand, otherwise they might be pushed into buying products and services that don't fit their needs.
That's the takeaway from a recent Gartner talk in Australia, reported by IT News.
At a symposium this week, Gartner analyst Dennis Gaughan explained what the four big vendors are really trying to do, based on Gartner's experience with its clients.

• Microsoft mainly wants to protect Windows and Office. Microsoft is a platform company, and its main goal is to protect its highly lucrative Windows and Office monopolies, while establishing other platforms that will be hard for customers to break away from later. New functionality is "drip fed" to users of those core platforms, but new products exist to protect the core. He advised extreme caution before moving to Office 365, and said not to slip into an "all-Microsoft" mentality.

• Oracle products don't really work well together. Oracle's sales force is extremely aggressive about pushing a suite of products, but has much fewer integration points than SAP. In fact, integration is usually left entirely up to the customer. Oracle is also very reluctant to talk about product roadmaps for fear that future products will cannibalize existing ones. The company makes more than 90% of its profits through maintenance fees, and will do whatever it takes to keep those fees flowing in. Gaughan also expressed some surprise that so many customers keep working with Oracle despite reporting that Oracle is "the most difficult vendor to deal with."

• IBM wants to take over your IT strategy. IBM bills itself as a thought leader, but its real business is selling consulting services. To thrive, IBM account managers try to take control of a company's IT strategy so they can keep pushing new products. Gaughan recommends taking a collaborative or partner approach.

• SAP confuses customers with pricing. A lot of SAP customers ask Gartner for help figuring out SAP's pricing and licensing, as SAP has unusual terms for billing data going into and out of systems. Gaughan also said that a big technology transition that was driving SAP revenue for the last few years -- moving existing customers from the old R/3 system to the newer Business Suite -- is almost done, which means SAP will have to be more aggressive with maintenance fees. He recommended locking in maintenance prices now.

Overall, Gaughan said that most of the innovation being done in these companies is in their research arms. Their real goal is protecting the status quo for as long as possible.