Acquire me! Oracle's and SAP's next targets

Thomas Wailgum looks at who the giants will buy next

Oracle and SAP have not been shy about making strategic and expensive acquisitions during the past several years. The numerous deals have been both big and small-some costing billions, others millions-and have filled out specific vertical-industry product offerings that allowed the enterprise software vendors to present a more all-encompassing, horizontal set of goods and services. The buys have also granted access to vast, new customer bases.

A recent report from technology analyst firm The 451 Group notes that the archrivals don't often butt heads over potential acquisition targets, at least publicly, with the exception of their feud over Retek in 2005 (which Oracle won). But there are similarities in their acquisition strategies, writes analyst China Martens in the September report, "Where Might Old Foes Oracle and SAP Each Look Next to Stave Off Apps Hunger Pangs?"

Who's Acquisition-Worthy

So which growing vendors are likely in the crosshairs of Oracle and SAP right now? In the report, Martens contends that "there is a wealth of possibilities" for the vendors in the apps market, "whether to expand their enterprise presence or to make a splash in the SMB arena."

For SAP, industry partners may be up first as likely acquisitions, Martens writes, "specifically, we'd point to talent management software vendor Nakisa and life sciences vendor ArisGlobal."

It may be high time that SAP makes a splashy purchase in the enterprise content management arena and buys what Martens calls the last independent vendor in that space — SAP partner Open Text.

For Oracle, Martens sees a buy among the SaaS players in the human capital management (HCM) market. "Would [Oracle] make a move there to both eliminate some competition and add more on-demand offerings alongside its own burgeoning SaaS HCM plans, perhaps acquiring SuccessFactors or Taleo?" she speculates. Acquiring a partner might also be in the plans: Oracle may want to pick up one of its SaaS partners to bolster its CRM On Demand software in an effort to keep up the fight against burgeoning rival Salesforce.com. "In that scenario," Martens writes, "we'd anticipate marketing automation player Eloqua and sales configuration, quoting and proposal management specialist BigMachines being of particular interest in expanding the boundaries of CRM On Demand."

As for any bold "Making a Statement" acquisitions, Martens offers up some intriguing scenarios such as SAP snatching Salesforce.com. Though unlikely, Martens notes that it would be a "very bold way for SAP to gain sizable SaaS credibility".

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