Third-Party Influence

Oracle's suit against SAP won't change the fact that users need a third-party maintenance option as long as enterprise vendors charge big bucks for service.

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Posted on Apr 01, 2008

Is there still a market for third-party maintenance? By the time you read this, there may have been a resolution to the court case between Oracle and SAP regarding SAP's TomorrowNow subsidiary, but I doubt it. And even if the court case is settled and TomorrowNow is sold off, the larger question of whether using third-party maintenance providers is a good idea will still be unresolved.

So let me try to resolve it here and now: If you're a shareholder in a large enterprise software vendor, third-party maintenance is a very bad idea. But if you're a customer, third-party maintenance is an excellent idea, and a service that you should have the right to use — legally and morally ‐ even if you don't think you'd ever want to do it.

Though the lawsuit — which alleges that TomorrowNow employees stole Oracle's proprietary support materials — has largely obtained its twin goals of humiliating SAP and shutting down TomorrowNow, it has failed to kill off the third-party maintenance market. Indeed, if anything, the court case has the potential of making third-party maintenance a major new force in the market, to the detriment of Oracle's finances and, ironically, SAP's as well.

The evidence that customers still want to pay less than the 22% they fork over to their vendors is hiding in plain sight all over the market. The most direct evidence is the continued success of Rimini Street, which was founded by Seth Ravin, the founder of TomorrowNow, and has largely copied its business model — minus the direct attacks on Oracle. Even with the lawsuit and the pall of uncertainty that Oracle would like to cast over the whole concept of third-party maintenance, Rimini has been growing rapidly, in part, according to CEO Ravin, by taking over TomorrowNow's customer base.

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