Oracle acquires RightNow Technologies: expert reaction

Oracle has stepped up its battle with Salesforce.com by acquiring cloud CRM firm RightNow Technologies. The company described the deal as an "aggressive" move to offer customers a "full range of Cloud Solutions including sales force automation, human resources, talent management, social networking, databases and Java as part of the Oracle Public Cloud."

Here’s what some other tech thought leaders have said:

Diane Clarkson, Forrester
This deal is particularly interesting because it marks the first time Oracle has bought a company that sells application programs accessed primarily over the Internet as software as a service. This is being widely interpreted as a shot across Salesforce’s bow.

RightNow has a lot to offer Oracle. We rate RightNow as a leader in our WAVE for CRM customer service suites. Along with salesforce.com, we called out RightNow as a SaaS solution that was faster to deploy and easier to change than traditional on-premise offerings. RightNow is well positioned to give Oracle a customer service offering for the mid market.

Success will very much rely upon how effectively Oracle can differentiate between their many customer service products to ensure their portfolio targeting is optimized. With this acquisition and previous ones – such as ATG and InQuira – there is overlapping customer service technology. It will be critical to differentiate between products such as knowledge management and chat. This will not be an easy task in this complex and ever-changing customer service technology landscape.

Fahim Siddiqui, chief product officer at IntraLinks
There are major drivers within the marketplace for cloud based computing and Oracle’s acquisition of cloud player RightNow truly validates this. Organisations are expanding their business models into the value chain and as a result are looking for new ways to communicate with the extended enterprise. So, more than ever, cloud is seen as the most natural place to do this and conduct successful collaborations between businesses.

As organisations more widely exchange critical information with other enterprises, they experience multiple business processes that need intelligent control to securely connect with partners outside the firewall.

The IT department now needs to fully understand that they don’t have to build it themselves but can adopt the cloud quickly for a fraction of the cost. However, they must ensure that they turn to a trusted provider, such as IntraLinks, to retain control to protect intellectual property and confidential information, whilst maintaining compliance to manage risk.

Nicole Engelbert, Ovum
We anticipate that clients of the Bozeman-based firm will experience a significant uptick in the level of industry-specific support with Oracle’s acquisition of RightNow Technologies.

This will particularly be the case for colleges and universities – where RightNow has been successful – as they will now have membership access to the Higher Education User Group (HEUG), a third-party organisation associated with Oracle, which is well-established, large, covers a broad set of products and services and has global reach.

However, as Oracle will now have three CRM solutions targeting higher education, Oracle CRM On-Demand, PeopleSoft CRM for Higher Education and RightNow, there may be some short- to medium-term anxiety around Oracle’s product development & support strategy.

Mary Wardley and Robert Mahowald, IDC
Key to Oracle’s strategy of maintaining market leadership is to keep Salesforce.com at bay, and to control the pace of industry change toward service-delivered IT functionality. Salesforce.com has been rapidly climbing the leaderboard and finished the market year 2010 in the third-place position with a market share of 8.3% and revenues of $1.3 billion in purely on-demand CRM applications. It has also created a far more heterogeneous portfolio than it had five years ago.

As Salesforce.com increases its investment in its customer service offering, Service Cloud 2, the pressure has been on Oracle to achieve a strong foothold as Salesforce.com builds out its offering. The acquisition of RightNow brings both an installed base of high profile brands (Nikon, Canon, Hertz, Toshiba) and deep customer service expertise.

In the short term, RightNow’s customer reaction to this news will be interesting to note. Culturally these two companies are very different. RightNow has prided itself in being a modern software company located in an unconventional location, with its headquarters in Bozeman, Montana, but still able to compete with Silicon Valley and attract talent.

Oracle has become a veritable smorgasbord of technical capabilities acquired through a wide variety of acquisitions. It is the ultimate demonstration in selection and variety versus monolithic solutions in the enterprise application space. Who is to say which will win in the long term? Customers will have the final say.

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