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Oracle integrates Siebel and CRM On Demand

More than five years after Siebel first created Siebel OnDemand, Oracle is now offering a pre-built, packaged integration between on-demand and on-premise systems.

Oracle Corp. today released a pre-built integration between CRM On Demand, its Software as a Service (SaaS) application, and Siebel, the premise-based CRM software company it acquired in 2005.

The feature will synchronize customer data between the two applications, giving sales and executive managers a better view into the sales pipeline, according to Oracle.

"The deep functionality of on-premise CRM and the rapid development and ease-of-use capabilities of on-demand CRM are now powerfully combined for organizations to extract even further value from their Oracle investments," Anthony Lye, senior vice president of CRM at Oracle, said in a statement.

The integration is based on the Oracle Application Integration Architecture (AIA) and Oracle Fusion Middleware. Customers can immediately begin supporting multiple instances of CRM on Demand with on-demand, on-premise or both. That option is sometimes referred to as a "hybrid deployment" by vendors like Oracle, Microsoft and SAP, which traditionally offered premise-based CRM systems but have since extended their offerings to SaaS.

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"I am not a big fan [of hybrid CRM deployments]," Rob Desisto, vice president and distinguished analyst with Stamford, Conn.-based Gartner Inc., told in an earlier interview. "This whole notion [that] I can start with SaaS and move on-premise -- we don't believe that's a good idea. We think it's very difficult to keep SaaS and on-premise in sync."

Desisto said he does see value in integrating on-demand and on-premise in certain cases, such as a company with a large premise-based system but a far-flung office or new branch running on-demand systems.

The integration between the Siebel on-premise application and Oracle CRM On Demand would seem a long time in coming, considering that On Demand evolved from Siebel CRM OnDemand, Siebel's foray into SaaS. Siebel acquired UpShot, an early pioneer in SaaS CRM, in 2003 and rolled out its own SaaS CRM product shortly thereafter.

There was a pre-existing connector between Siebel CRM and CRM On Demand, but Oracle wanted to build it on AIA, an Oracle spokesman said.

Siebel OnDemand disappeared for a while in the wake of the company's acquisition by Oracle and its migration from an IBM-hosted data center to one run by Oracle.

SAP has also run into some roadblocks on the path to SaaS. It first released SAP Sales On Demand in early 2006, primarily as a way to fend off's encroachment into its own customer base. However, with the release of SAP CRM 2006s and CRM 2007, with a revamped UI, the company shifted its attention to a separate midmarket product. That venture, Business ByDesign, has been scaled back as SAP struggles for a way to make money with the SaaS delivery model.

With today's announcement, Oracle too is hoping to fend off, according to Bill Band, research vice president with Cambridge, Mass.-based Forrester Research.

"This is an announcement that makes a lot of sense form a strategic point of view," Band said. "There are a large number of existing Oracle Siebel customers that could be thinking about adding the capability for new sales organizations and not to have an on-demand option would mean that the Siebel install base would still be vulnerable to encroachment by It does put Oracle CRM in a position to say that they can now offer the full flexibility of both deployment options, which is what Microsoft CRM is also pushing and cannot offer."

The Oracle integration module is available for a one-time license fee of $35,000 per Oracle Fusion Middleware processor. If a customer's data, transaction volume and performance requirements dictate multiple processors, the price is based on the number of processors. A maintenance fee of 22% of the license list price will be applied, as with all licensed products.

The integration is compatible only with Siebel version 7.8 and higher.

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