Oracle Corp says that it has now won all ten of the top US insurance companies as customers for its e-business database infrastructure and applications. Fortune Magazine recently rated the top ten companies by revenue as State Farm, TIAA-CREF, Prudential, American International Group Inc, Metropolitan Life, Allstate, Aetna, New York Life Insurance and Northwestern Mutual. While Oracle admits that those companies are using different levels of Oracle software, it claims that it is now a dominant player in financial services, a market sector where it was very weak three-and-a-half years ago when it began efforts to target that business.
At that time Sybase Inc and Informix Corp had a stronger market share than Oracle, with Sybase holding the major share, especially in capital markets. Now, financial firms appear to be more comfortable turning to the largest companies, such as Oracle and IBM Corp, for their software. Oracle claims that IBM has been concentrating on pure database and technology sales and is suffering from an applications gap. Meanwhile Oracle has pushed into the applications space, completed integration work, and even bought in some industry specific applications, such as those it acquired from Treasury Services Corp back in August 1997 (CI No 3,218).
Oracle says it’s changed the way it markets software to financial companies in those three years, surrounding the core database technology with applications. It concentrates on three areas: enterprise resource planning, strategic enterprise management and customer relationship management. ERP for the insurance, banking and capital market industries has lagged behind other market sectors, says Oracle, and it sees a big opportunity there. Strategic enterprise management includes profitability, activities based costing and balanced scorecard applications. Customer relationship management extends to sales force automation. A fourth and growing application area in financial services is strategic procurement, where Oracle competes with Ariba Inc, CommerceOne and Telesys Corp, but where it claims, despite a certain lack of visibility, to be the revenue leader.
IBM Corp, with its huge installed base in financial services, remains the biggest threat to Oracle, and recently IBM bought back customer relationship management into its geographical sales force with the re-integration of its Corepoint customer relationship management division back into the main company. But Oracle says that IBM can’t compete on the distributed computing side, as DB2 on different platforms is still more of a naming convention than a unified product line.
Meanwhile, Oracle says it now has 12 signed customers for Oracle Business OnLine, its application software hosting business. Early pilot customers Core Technology Group, Robert Mondavi Corp and Triton Network Systems, have now been joined by others including Benchmark Tape Systems, ConvergeNet Technologies Inc, LDMI Telecommunications Inc and TeraLogic Inc.
