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Siebel a decaying asset?

Peoplesoft didn’t really mark the end of an era for me, nor did Macromedia. I think Siebel - were it to be scarfed up - would do the trick. The Wall St. Journal had a piece yesterday that brought me short with this realization. Oracle Has Discussed Siebel Buyout Not really a big deal, but I was struck by shareholder revolt leader Herbert Denton proclaiming “Siebel can be viewed as a ‘decaying asset,’” in a letter to the board.

The logic is saturation and consolidation and customer reluctance to upgrade, which are inexorable forces at work in the enterprise space. But the phrasing seems particularly jarring in that it states the obvious: software is a decaying asset. Sure Siebel’s business was never what it seemed in 1999, with untold licenses bought but never installed. In fact, last spring I found a Gartner stat that said 42% of all CRM sw went unused, vs the industry norm of 20%. CRM software is particularly suspect because walking around enterprises you can see how few people use it.

Since then Siebel, among the big players of that day, has labored under the weight of needing to prove its usefulness. Fighting to grow sales (we could joke about how much of that 42% was later upgraded) off a bogus number that itself is cause for ill-will from your customers, in the face of competition and code-base and functional maturity that itsefl is a natural impediment to ready upgrading. Oh, and there’s the re-emergence of that pesky ASP model, call it grid, software as a service, BPO, whatever - all that puts an end to professional services around installs and custom work. Gak - what a mess. So Siebel’s got On Demand now, and might even make an acquisition here or there, but we’ll see where it all ends up.

When I started this, I was going to point out the irony that all software is decaying, in that new versions are generally welcomed. But ironically, the problem in this space is that the software is not decaying, it’s the appetite for investment on the part of customers and partners. Software gets to be good enough, and it’s clearly time to go out and find new markets. But that’s the hardest message of all to get through to big successful-feeling companies who have achieved a lot through the years. End of life is a real stage, you either do it yourself, or the market’ll do it for you.

Oh, and a note about how I derived this link. From an idea on a blog (maybe Doc’s??), I emailed myself a link, which will be good for you for a week; if you are a WSJ subscriber the 30-day link is here.