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News: Oracle vs SAP: The Battle Begins



November 2nd, 2010. A battle between two leading business-software developers reached the courtroom, where they will battle to determine exactly how badly SAP subsidiary TomorrowNow damaged Oracle when it allegedly stole from Oracle’s password-protected web sites. SAP admits its subsidiary secretly copied instruction manuals and technical specifications for Oracle's software, but the two still strongly disagree over how much should be paid to settle the matter.

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Oracle filed the lawsuit in March of 2007 after allegedly discovering that SAP subsidiary TomorrowNow, which provided third-party support for Oracle applications like JD Edwards and PeopleSoft, had been illegally accessing its support tools.

Oracle said TomorrowNow created fake accounts to get access to secured Oracle Web sites. Once inside TomorrowNow deployed computer programs that powered through page after page of support documents, tapping contents of those pages as they went.

Oracle spotted the fraud when it noticed an extraordinary number of downloads coming from accounts that were registered with clearly bad information, such as bad phone numbers and made-up names seemingly connected with the SAP subsidiary. Oracle technicians were also easily able to tell that the downloads went to TomorrowNow servers.

About eight months later, SAP admitted TomorrowNow was wrong, closed down that subsidiary and offered compensation, but Oracle pressed on with its lawsuit. SAP argues that Oracle's claims of injury are exaggerated. It says it owes Oracle just tens of millions of dollars, a fraction of the $2 billion Oracle is seeking.

These corporate-espionage allegations show how fierce the competition between Oracle and SAP has become. It also emphasizes Oracle's changing role in the industry of business software. Along the way, Oracle has made some big enemies, particularly SAP.

Oracle alleges that SAP has resorted to theft to poach customers and harm Oracle following its shift on SAP's turf, particularly with the acquisition of PeopleSoft in 2005. Shortly after Oracle announced its intention to take over PeopleSoft, SAP acquired TomorrowNow, a company that supported PeopleSoft software. It was an attempt to take support business from Oracle and eventually upgrade PeopleSoft customers to SAP products.

In some cases, SAP, through TomorrowNow, had legitimate access to Oracle's secured sites, as TomorrowNow supported Oracle customers and was allowed to use their databases to look for answers for support questions. But TomorrowNow wasn't allowed to use the data it found there for other purposes or to download the information

Oracle says SAP re-branded some of its documents and passed them off to customers as SAP's own. Oracle also accuses SAP of making illegal copies of Oracle's software and using them as models for SAP's own software suite.

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