B2BWorkforce - Siebel Observer

January 7, 2003

Special Edition

NEWS

Siebel Earnings News Sparks Rally

The World's Finest Resorts Selects CRM OnDemand

What They Were Reading Last Quarter

Concerto to Outsource Help Desk

Israel Misses Chance to Dominate Software

China's State-Owned Software Company Goes Private

Oracle Extends Offer for PeopleSoft

Primus Acquires Amacis

Next Chapter of Contact Center Book Released

Last Week's Gainers and Losers
Dow NASDAQ S&P500 SOI	Close 10,538.66 2,057.37 1,123.67 521.77	Change 260.44 106.35 35.01 39.08	Percent 3% 5% 3% 8%
Company	Close	Change	Percent
Siebel Accenture AMS AnswerThink Avaya Blue Martini Cap Gemini Cisco Concerto Cognizant Group 1 Inforte Jacada Primus SPSS Tietonator WITS Xansa	15.91 26.30 15.68 6.10 12.96 4.90 45.55 euro 25.06 12.00 50.75 17.72 9.45 3.56 7.01 19.41 208.50 Sk 9.37 83 p	1.91 0.70 1.11 0.99 1.56 0.34 0.80 euro 1.27 -0.03 0.00 0.15 1.35 0.38 0.98 1.40 8.50 Sk 0.15 3 p	14% 3% 8% 19% 14% 7% 2% 5% 0% 0% 1% 17% 0% 16% 8% 4% 2% 4%

Quote

I believe to my heart that Bangladesh has the possibility to be the major global player in IT sector.

Amir Khosru Mahmud Chowdhury
Commerce Minister of Bangladesh

What do you think, that if everyone outsources to India and China that no good jobs will be left in the USA other than flipping hamburgers???

Douglas Gollnick

At the heart of the problem is that most IT professionals enjoy troubleshooting PC and network problems. Its predictable work that has nearly immediate payoff because you solve multiple problems per day and people think you're a hero for doing it...... They can't imagine what will fill their days if they're not fixing PCs and networks all day.

Professor Phillip Windley
>From his Enterprise Computing Weblog

Events

The fourth annual Enterprise Software Summit takes place this year in Sundance Utah from February 1st to February 4th. Among the topics covered:

The New Enterprise Software Business Model
Premise vs Hosted and Perpetual vs Subscription

White Spaces in Software
What is Left to Be Developed?

Consolidation
Who is Likely to be Acquired?

Offshore Outsourcing
Are the True Costs Fully Understood?

-more-

-->

Technical Papers

The Future of Employee
Relationship Management

Price: $50.00

Implementing Siebel CTI

Price: $50.00

Working with EIM to Import Data Quickly

Price: $50.00

Basic Actuate Siebel Report Writing

Price: $50.00

Effectively Implementing Siebel VB/COM

Price: $50.00

-->

--> In Association With

Disclaimer

The Siebel Observer is not
affiliated with Siebel Systems, Inc.
Just as the Siebel Observer does not
endorse everything Siebel Systems does,
Siebel Systems does not endorse Great
Divide Research or the Siebel Observer.
This is your guarantee the newsletter
will remain an objective, factual source
of information.

If you received this publication by mistake and do not wish to receive any more issues, please accept our apology for the error and click here. The Siebel Observer uses

to ensure your privacy is respected.

Siebel Earnings News Sparks Rally

Siebel Systems reported early in the quarter that it expects total revenues for the fourth quarter of 2003 to be $365 million and license revenues to be approximately $150 million. This is well above management's expectations for the quarter, which were announced to analysts as being in the $335 million to $355 million, $120 million to $140 range.

The early morning news sparked a rally in the equities market for technology stocks and caused the Nasdaq to reach a two-year high.

This is welcome news to everyone in the Siebel ecology. Company employees deserve all the congratulations they have been receiving from management, analysts and investors. Does this mean that happy times are here again in the enterprise software business?

Unfortunately, no. Despite the encouraging quarter, one early causality is Rich Chiarello, the senior vice president for worldwide sales, who has left the company.

He will not be the last person affected. As the smoke of the worst recession in software clears, software vendors, such as Siebel Systems, can look forward to an increase in IT spending. Yet how customers pay for technological innovation will be an issue. Four trends - offshore outsourcing, consolidation, changes in the revenue license business model, and the question of what is left for vendors to develop - leave the purchasing power in the hands of the customer.

At the moment, no new technology seems particularly compelling to many buyers. Customers are refusing to upgrade to new versions, and forcing suppliers continue to support old software.

A case in point, Fluor Corporation had so many problems installing an SAP upgrade, it went back to an older version, fired its CIO, and took a $13 million write-off. Nothing unusual in that. But when SAP announced plans to drop support for the version Fluor was using, the company suspended its monthly maintenance payments and threatened legal action. Eventually this pressure forced SAP to back down from its plans to drop support.

The lack of compelling software gives customers even more power than they had in the recession, and they are using it to challenge the traditional rules of software licensing. Oddly enough, these changes may not make software less expensive but may require the vendor to assume more risk - both technical and financial. The first sign of this is market demand for old software in new revenue and delivery models like Siebel CRM OnDemand.

The World's Finest Resorts Selects CRM OnDemand

The World's Finest Resorts, a private members club for vacation property owners, has selected Siebel CRM OnDemand to help grow its business. The World's Finest Resorts is participating in an early adopters' program.

"Siebel offers the best CRM solution on the market. The fact that it is rolling its best practices and analytics capabilities into the hosted solution made the choice easy for us," said Chris Abbott, chief operating officer and principal, The World's Finest Resorts.

What They Were Reading Last Quarter

Perhaps the first sign of the good quarter was given by purchasing circles created by Amazon.com. The second most popular title ordered by employees of Siebel Systems was Flipping Properties: Generate Instant Cash Profits in Real Estate. The employees of SAP did not order enough books (at least in English) to qualify for a purchase circle. But what can observers make of PeopleSoft's number two choice: Bringing Down the House: The Inside Story of Six MIT Students Who Took Vegas for Millions?

Concerto to Outsource Help Desk

Concerto Software plans to move its help desk to India in February. CEO James D. Foy is expected to visit the country at that time to announce the set up of the 70 person facility.

Currently Concerto has three help desk centers in Massachusetts, London and Singapore. According to the Economic Times of India, some job losses in Massachusetts are expected as a result of the shift.

Israel Missed Chance to Dominate Software says SAP Executive

In a speech before computer science students at the Israel Institute of Technology (Technion), SAP executive Shai Agassi said the country missed an opportunity by not allowing more Indian software engineers into the country, according to Globes [online].

"Israeli brain-power is an expensive and scarce resource and action must be taken to strengthen the industry. When the high-tech boom peaked three or four years ago, Israel made the mistake by not allowing import of more inexpensive software personnel such as programmers from India," said Agassi.

"Salaries in the industry wouldn't have been so high, and we might now have become a high-tech superpower. Companies stayed here solely for sentimental reasons."

Reacting to these remarks, Amiram Shaw, president of the Israel Software Association said, "I totally disagree with him."

China's State-Owned Software Company Goes Private

The state-owned China National Computer Software and Technology Service Corporation (CS&S) was acquired by its publicly traded subsidiary, CS&S Network Technology Company, Ltd. CS&S was the 62th largest information and electronics company in China last year.

"It is a milestone in the development of CS&S, since we will be no more a wholly State-owned enterprise but a public company," said Tang Min, president of CS&S and CS&S Network chairman.

After the acquisition, the name CS&S Network will be changed to China Soft. The move is another step in China's efforts to challenge Western technology dominance.

In August the State Council, China's governing body, mandated all government bodies buy only Chinese-produced software in the next upgrade cycle. The new policy is meant to support the local software industry and protect state security. Since the largest 100 enterprises in China are also state-controlled, this could close much, if not all, of the potentially largest market for software for the next century.

Primus Acquires Amacis

Primus Knowledge Solutions (Nasdaq: PKSI) has acquired the European-based electronic commerce management software company, Amacis Group Limited. The acquisition extends Primus' depth in the eService marketplace by adding complementary email and wireless technologies to Primus' customer service and support software.

"Marrying strong Web self-service solutions, knowledge management capabilities, and natural language search with core capabilities around email management and mobile messaging creates a strong eService product suite," said Esteban Kolsky, research director with Gartner.

Privately held Amacis recently won the Banker Technology Award 2003 for excellence in applications and services for financial services companies. Amacis was also recently awarded Aberdeen's "What Works" Award for successful CRM implementations.

Primus has purchased all the shares in Amacis in exchange for 1,234,692 shares of Primus common stock, plus an assumption of Amacis vested stock options, equivalent to 265,327 Primus vested stock options.

Oracle Extends Offer for PeopleSoft

Oracle Corporation (NASDAQ: ORCL) has extended its hostile takeover bid for PeopleSoft to February 13, 2004. Oracle has also raised another $1.5 billion to fund its offer.

In an SEC filing, Oracle said it has negotiated a line of credit with ABN Amro Bank and Credit Suisse First Boston, among other lenders.

As of December 19, a total of 12,395,576 shares had been tendered, or about 3% of the 374,938,000 shares outstanding.

Next Chapter of Contact Center Book Released

SAP's Mary Cauwels, the next contributor to Building the On-Demand Contact Center, has noted that contact center implementations often are the first phase in larger projects. If they deliver an immediate return on investment, they greatly expand IT investments in sales, marketing and service over time.

To explore how to build an better return on contact center investments, Citrix Systems is sponsoring Building the On-Demand Contact Center with editorial assistance from The Siebel Observer.

To read this chapter of Building the On-Demand Contact Center please click here. Correction

Does your company already subscribe?
You might be eligible for a free subscription!

Corporate Subscribers List

Subscribe

Copyright © 2003 The Siebel Observer LLC All Rights Reserved.
The information contained herein is believed to be reliable, but not necessarily complete nor can its accuracy be guaranteed. For further information on the material featured in the Siebel Observer, contact 303-399-8399 or editor@siebelobserver.com.
All trademarks are property of their respective holders.