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Siebel talks TCO at European user event

Siebel made a string of announcements at its annual European User Week relative to TCO, new functionality, an acquisition and extended services offerings.

While the rest of the CRM industry was eyeing the merger and acquisition shakeup stateside, market leader Siebel Systems Inc. was an ocean away, courting customers with a message of lower total cost of ownership (TCO) at its annual European user event.

Siebel European User Week 2003 drew an estimated 1,500 users and partners to Cannes, France, where Siebel thumped its war cry of reducing TCO, announced an acquisition of its own, unveiled a new version of its applications package and extended new services offerings.

"Lower total cost of ownership is what customers continue to push for. That's nothing new, but we're making some real steps forward here," said Skip Bacon, Siebel's general manager of technology. "What we've announced couldn't be any more different than buying J.D. Edwards, but I think our customers will thank us for that."

The acquisition Siebel announced was aimed at reducing time and money spent by users on communicating with customers. It snapped up the assets of messaging software maker BoldFish Inc., Santa Clara, Calif. Bacon said the BoldFish buyout and integration of its permission-based messaging and e-mail marketing functionality into Siebel's own marketing applications will improve users' ability to manage inbound and outbound campaigns.

Also announced at the European show was the latest iteration of Siebel's enterprise CRM package, version 7.5.3. Bacon equated the release to a "super patch" preceding the full-scale systems overhaul due in Siebel 7.7, which is slated to arrive in spring 2004. Bacon said improvements made in 7.5.3 focus largely on TCO, with the primary emphasis going toward lowered implementation and maintenance costs through more complex implementation templates and business process support than Siebel has supplied in the past.

On a related note, the software maker rolled out new Siebel Global Services offerings to improve the planning, implementation and deployment phase of CRM projects. Among the new services the firm introduced were Rapid Deployment Offerings, MultiChannel Effectiveness Services and Business Process Solution Sets. Tied together with Siebel 7.5.3, the services could greatly help drive down the staggering deployment costs Siebel has been criticized for in the past, Bacon said.

"There's a common thread here, and this is what you should expect to hear more from us going forward," Bacon said. "We're not saying that we can help you go live with a 10,000-seat deployment overnight, but we want to drive deployment costs down across the board and help users see returns more rapidly."

Bacon said Siebel is also putting more effort into carving out fixed-price deployment agreements with new customers.

Industry watchers praised Siebel's attempt to drive down TCO and implementation costs but wondered whether the effort will bring results.

"Siebel definitely seems interested in presenting a consistent message in terms of lowering up-front costs, but it will be interesting to see if there's real impact," said Kelly Ferguson, principal analyst at Sterling, Va.-based Current Analysis.

Ferguson said Siebel is pursuing the "back-to-basics" approach popular among vendors today but pointed out that good marketing doesn't always equate to real-world results.

"The difference is in execution, and only time will tell if Siebel can actually eliminate the time and expense needed to lower TCO," Ferguson said.


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