Sidebar: Siebel Buy May End IBM Alliance

Oracle's agreement to buy Siebel Systems last week immediately raised questions about the future of Siebel's CRM OnDemand service -- a venture in which Oracle rival IBM is deeply involved.

Executives from both Siebel and Oracle said that the hosted customer relationship management service will continue to go forward.

However, a close look suggests that IBM is likely to be left out of Siebel's OnDemand future.

Siebel is the highest-profile partner in IBM's Software as Services program, a network of independent software vendors that sell applications as hosted services managed by IBM.

When Siebel CRM OnDemand launched two years ago, Siebel and IBM characterized it as a joint venture that would be developed and marketed jointly by the two companies.

Now, Siebel is casting IBM as a partner of convenience that can be abandoned without any customer disruption. "There is no technical linkage. We can make a different decision going forward," said Bruce Cleveland, Siebel's senior vice president of products.

An IBM spokesman said the company plans to continue supporting its joint customers with Siebel.

Analysts said they expect Oracle to maintain some ties with IBM if that's what's needed to keep customers' deployments running smoothly.

"Oracle can't afford to [anger] IBM too much, and vice versa," said Ovum Ltd. analyst David Bradshaw, who noted that the two companies have a number of joint customers.

Copyright © 2005 IDG Communications, Inc.

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