Oracle Sees Future in OSS

Telephony Online
October 24, 2006

Enterprise Software Company Adding MetaSolv to Product Portfolio

Oracle's $219.2 million cash acquisition of OSS service fulfillment vendor MetaSolv cements the big enterprise software company's commitment to the evolving telecom back-office space by adding what might be a final piece to a list of company acquisitions.

IP is rapidly transforming telco operations and provisioning with the backoffice environment becoming more software- driven. Oracle, by acquiring some of the more noticeable vendors supplying the space, is now moving from a software element to delivering an end-to-end product that includes MetaSolv's provisioning, network inventory and activation products for broadband, mobile and data services.

"I think they're trying to strengthen that telecom vertical," said Shira Levine, senior research analyst for IDC. "They historically have not had a very strong obvious presence in telecom and they want to strengthen that."

Oracle previously purchased Portal Software as well as "a couple smaller application server vendors," said Levine. "They're putting together this whole service delivery platform strategy which they're starting to integrate with some of the OSS assets they're acquiring."

The acquisitions also help Oracle keep pace with the changing backoffice environment where IMS, VoIP, IPTV, IP VPN and broadband services overshadow traditional voice.

The industry is consolidating across the board and MetaSolv probably needed to be acquired to continue to be competitive. Telcordia, like the newly structured Oracle, is an 800-pound gorilla in the space, but other companies have been positioning themselves to succeed in the new software- based business.

"You have Amdocs buying Cramer which could be a threat to MetaSolv, depending on how that's handled. You have a company like NetCracker coming up and nipping at its heels," Levine said. "It's not an easy market to be in."

Even with the acquisitions, it won't be an easy market for Oracle.

"They don't have a lot of awareness in telecom per se. They've been hiring people like crazy with telecom experience," she said.

And they've been buying up the pieces that are missing.

"Basically," she concluded, "that's instant entry into the market."