PeopleSoft, IBM strike middleware alliance

PeopleSoft is deepening its ties with IBM, announcing on Tuesday a sales and development partnership it called the most significant enterprise applications alliance in the companies' history.

PeopleSoft will work with IBM to optimize its applications for use with IBM's WebSphere middleware and development tools, and will begin selling WebSphere products directly through its own sales force. The two companies will also jointly develop software packages aimed at customers in three industries: financial services, telecommunication, and insurance. PeopleSoft and IBM, already close partners, have worked together before on a number of development initiatives, but PeopleSoft executives said this agreement is their most far-reaching.

In his opening keynote at PeopleSoft's Connect user conference, PeopleSoft Chief Executive Officer Craig Conway lavished praise on IBM, calling it the company with "the most proven, trusted, tungsten-strength middleware." He also took the opportunity to blast SAP, whose applications compete with PeopleSoft's and whose new middleware platform vies with IBM's. SAP's NetWeaver middleware software is "young, largely acquired, and incomplete," Conway charged.

PeopleSoft and IBM will together invest US$1 billion over the next five years in their joint activities, Conway said. Both will still remain flexible enough to serve customers using other applications or middleware foundations, he said: "Neither company has an ulterior motive. Both companies have been devoted to open architecture from the beginning."

PeopleSoft's move toward embracing IBM's middleware echoes one made by J.D. Edwards & Co. in 2002, before its acquisition by PeopleSoft. J.D. Edwards decided to standardize around IBM and integrate its middleware into its own applications.

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