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SugarCRM CEO: Thank you, Larry Ellison

SugarCRM CEO: Thank you, Larry Ellison

By  Mark Brunelli

03 Nov 2005 | SearchEnterpriseLinux.com

NEWTON, Mass. -- Oracle Corp.'s effort to shrink the number of proprietary customer relationship management (CRM) software vendors through acquisition has been a very good thing for open source software maker SugarCRM, said CEO John Roberts.

Speaking to SearchOpenSource.com in between sessions at the Open Source Business Conference, Roberts said downloads of his company's open source CRM suite have "skyrocketed" as a result of customer apprehension over Oracle's recent string of high-profile CRM acquisitions. That's why Roberts has a message for Oracle CEO Larry Ellison.

"I can't thank Larry enough," Roberts said. "It's been really good for us as a company."

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Roberts said he believes that consolidation among proprietary CRM vendors limits their drive to innovate and adapt to changing business needs. This is also good for firms like SugarCRM, he added, because adaptability is a key strength of the open source development model.

"I think the belief is that if you eliminate choice, then you can jack up prices over time," Roberts said. "It minimizes innovation because if you're only competing with one or two other people, the innovation game really slows down. So I think it's a great thing for us."

Oracle has been on a high-profile acquisition spree in recent years. It began with the purchase of J.D. Edwards & Co., was followed by a year-long fight to takeover CRM software maker PeopleSoft Inc. and culminated recently with the planned $5.85 billion purchase of CRM giant Siebel Systems Inc.

Along the way, Oracle also picked up several smaller, non-CRM software firms, including retail industry vendor Retek Inc., security firm Oblix and embedded database vendor Innobase OY.

Industry analysts agree with Roberts that consolidation among proprietary vendors tends to open up opportunities for open source vendors.

In a recent interview, Michael Goulde, a software industry analyst with Cambridge, Mass.-based Forrester Research Inc., said open source firms have historically excelled at attacking markets with few proprietary suppliers.

"[Consolidation] narrows down the scope of things that [open source firms] need to address," Goulde said. "It opens up an opportunity, because they can then address the gaps that those few remaining suppliers have left in their offering."

Roberts said he thinks that consolidation in all areas of the proprietary software market will continue to drive interest in open source.

"I think that people are seeing that open source is a very real thing," Roberts said. "There is this suspicion that it's part-time hippies [developing code] in the woods and it's not. It's a superior development model, and I think more and more organizations are pleasantly surprised with what they're finding."