Microsoft, donning the mantle of moral watchdog, has launched a stinging attack on Oracle CEO Larry Ellison, accusing him of being "disingenuous" and misleading customers.
The brouhaha comes as Oracle prepares for its big AppsWorld conference in New Orleans this week.
One of the themes of the conference is the company's much-touted US$1 billion savings through the use of its own 11i Web-based business software, which competes with Microsoft's .Net offerings.
And that's what really irks Microsoft.
"This is the third time Ellison has made this US$1 billion savings claim, which was refuted as hollow on both previous occasions," Barry Goffe, group manager of Microsoft's .Net developer and enterprise group, told eWEEK.
"Oracle is up to its same old tricks, trying to encourage people to buy its software using bogus claims. People need to be made aware of this."
While Microsoft is "not terribly threatened" by Oracle's claims, "the story of its deception has to be told," Goffe continued. "It's not as if we're reallocating marketing dollars and taking out full-page ads saying Larry's a liar."
Oracle on Microsoft: 'They're threatened'
But Jennifer Glass, Oracle's vice president of corporate public relations, said it was interesting to see Microsoft taking the moral high ground.
"I guess as they struggle to sell their software they now need to find a new niche," Glass said, adding that Oracle's US$1 billion in savings was a fact, backed up by hard numbers, whether Microsoft liked it or not.
"I am not surprised by the Microsoft broadside, given how threatened they are by our e-Business software," she said. "Throughout our conference this week we will be addressing the US$1 billion saving issue. ... In fact, we are well on the way to our second billion dollars in savings."
Microsoft's Goffe said he had examined Oracle's financial statements posted on its Web site and filed with the SEC. While there was indeed a US$1 billion difference between Oracle's revenue growth and expense growth, the biggest decrease in expenses was in the services arena, he said.
"They saved US$400 million in getting rid of people, not in savings they can directly attribute to their e-Business software," Goffe said.
"The issue to customers was two-fold. Firstly, were they going to buy software based on bogus claims and, secondly, how were they benefiting from the service cutbacks? Oracle's existing customers would be hurt as there would be less service available to them overall and fewer Oracle support staff there to help them," Goffe said.
Oracle's Glass challenged this assertion, saying the company had been pleased to be able to save money by decreasing its headcount. A big part of the savings had come from automating the support process. This was vital, particularly for exceptionally technical users who don't want to explain their issues to a number of people.
"There is always a way for the customer to talk to a person, but the automation has been largely well received," she added.
