Applications vendors are trying to lure away each other’s customers by offering those users on older software versions cheap deals on support. Given the complexity of the software, users tend to move slowly from one business application release to the next, with the upgrade cycle as long as five years….
SAP applications run on a number of different databases, with Oracle’s one of the most popular. Oracle is keen to encourage those SAP users, some of whom are already also using Oracle’s Fusion middleware, to switch over to Oracle applications, offering a 100 percent license credit as a sweetener.
Oracle plans to set up a Solution Support Center for providers of R/3 support to help them run the SAP applications on Oracle databases. The company claims the support services its partner Systime will offer could cost 55 percent less than what SAP charges customers.
Great. SAP starts the war by offering name-brand third-party support, which eats into the maintenance revenue stream. Now Oracle one-ups them with a license credit, shrinking the main driver of revenues to zero (at least temporarily.)
SAP 1-yr chart:
ORCL 1-yr chart: