Oracle-SAP Showdown: Will Larry Ellison Rip Huge ERP Customer from SAP as Promised?

It’s now mid-March and therefore the time when Oracle founder Larry Ellison promised to disclose full details about the big German corporation abandoning its SAP on-premises ERP system and migrating to Ellison’s Oracle ERP Cloud.

Oracle announces its fiscal-Q3 earnings tomorrow afternoon. That would be the ideal time for it to disclose this cutover customer whose defection from SAP will trigger, according to Ellison, a mass move of other big SAP ERP customers to Oracle.

Adding to the drama is SAP’s complete dismissal of these claims, which I wrote about several weeks ago in Oracle-SAP Showdown: SAP Calls BS on Larry Ellison Claim of Snatching Huge SAP Customer.

While the public wrangling between these two head-on competitors still run by founders with very healthy egos and little love for the other has been going on for years, it’s never taken a twist quite like this one about an imminent Pied-Piper wave of defections.

Ellison’s predictions about trouble brewing for SAP came in Oracle’s mid-December earnings call, during which Ellison claimed that “SAP’s customer base is up for grabs.” And before a quick recap of Ellison’s promise about a showcase customer defection, bear in mind that SAP co-CEO Christian Klein totally dismissed such a possibility, saying “And actually we double-checked and honestly, I couldn’t find any customer who moved away from SAP ERP.”

Ellison’s comments during that December earnings call:

• “Right at the very apex of SAP’s customer base, in their top 50 customers around the world, is this big opportunity and we’re looking at this one particular implementation where we expect to go live in March of next year [that’s 6 weeks from now in March 2020]. And I would describe them as rooting for us. They want to have an alternative to a $1 billion SAP upgrade.” 
• “We’ve just got to demonstrate that we can safely take these enormous companies to the cloud in a way that they’re not putting their business in any risk. And that’s why they’re watching this one particular giant implementation so closely.”
• “By the way, they’re not just watching and waiting. A number of their biggest customers in the heart of Germany—these are German customers, the core of SAP—are working with us. And moving some of their divisions to Oracle Fusion to persuade themselves that we can do this safely. They’ve gone that far.”

So: if Ellison is right, and this big German customer does indeed do a rip-and-replace with SAP going out and Oracle ERP Cloud coming in, then Oracle will gain huge momentum in this huge and viciously competitive marketplace.

Conversely, if SAP is right and none of its big core German customers are about to defect to Oracle, then the momentum will swing to SAP. Meanwhile, Oracle’s credibility will take a severe hit.

My guess: during Oracle’s earnings call on Thursday, March 12, Ellison will disclose that a big German corporation has agreed to install Oracle ERP Cloud in a few of its departments or divisions, but is also keeping SAP as its primary ERP provider.

Disclosure: at the time of this writing, Oracle was among the many clients of Cloud Wars Media LLC and/or Evans Strategic Communications LLC.

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