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Oracle Plants a Stake in the World of Green Software

  • Posted: Friday, October 03, 2008
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  • Author: pradhana
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  • Filed under: Business Analysis

By Warren Wilson, Research Director at Ovum

The ESS/Oracle alliance addresses a growing market for environmental management solutions

The alliance was announced last week at Oracle’s annual OpenWorld conference in San Francisco. It will pair ESS’s environmental data-gathering software with two Oracle solutions – Governance, Risk and Compliance (GRC) Manager, and Business Intelligence Suite Enterprise Edition Plus. The joint solution aims to help customers collect environmental data more quickly, consistently and accurately; to set and enforce environmental policies; to use operational BI to reduce environmental impacts; and to simplify and reduce the cost of generating reports for regulators, customers, and the like.

The companies say they will go to market together but aren’t yet providing details of how they’ll do that. What would make sense would be for them to first target Oracle customers that haven’t yet bought the GRC Manager solution or BI Suite, and use those early engagements to integrate the ESS and Oracle offerings in ways that can be repeated in future engagements. Oracle doesn’t plan to offer environmental monitoring on a standalone basis but over time will build it into a wide range of products, making them more capable and ‘stickier’.

This market is being driven partly by environmental regulations, which are increasing in scope and stringency. Growing public concern about the environment, especially but not limited to climate change, is another key driver. That concern expresses itself in a growing preference for products and services from companies that can demonstrate their environmental credentials. Management depends on measurement, and measurement depends on the collection of accurate data; together, ESS and Oracle provide that capability. (For an in-depth analysis of this topic, see Ovum’s recent report, Green IT: the software opportunity.)

Oracle painted itself green at Open World, and why not? Green is so much nicer than the gray of indifference.

‘Green’ was everywhere at OpenWorld: in the show catalog, shrunk from phone-book size to a svelte half-inch thick; in a green marketplace, which showcased environmentally friendly products from software to chocolate and olive oil; in ‘green awards’, e.g. to the Pacific Gas & Electric utility for beginning to deploy ‘smart’ meters that help customers reduce power consumption and/or shift consumption to lower-cost times of day; in a series of presentations in which Oracle executives and partners described the market shift they see gathering steam in which energy consumption and carbon output become central to business planning, rather than afterthoughts.

It’s easy to scoff at such talk and dismiss it as mere self-promotion and bandwagon-jumping. Frankly, we think it’s more akin to a stake in the ground. And the more stakes in the ground – the more claims vendors make about their solutions – the sooner customers will start critically evaluating the claims and holding vendors to account, and the sooner the vendors will have to compete in earnest on the business value of their ‘green’ products and services. This will not only winnow valuable solutions from chaff, but will also help to identify stumbling blocks, such as the lack of a widely accepted standard for carbon reporting.

Out of the confusion and conflicting claims will come pressure for such a standard – either de jure, set by regulators, or de facto, set by vendors. Altruism is a fine thing, but by itself it won’t slow the pace of climate change. Self-interest and competition will. /PR

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