Global Economics

Oracle Sees Slower Growth in Asia


The software vendor's third quarter Asia-Pacific revenue grew by about 34%, a result the company says will be difficult to maintain

During a regional teleconference with reporters Friday, Brian Mitchell, senior vice president at Oracle Asia-Pacific, said the next few quarters will be "a little bit challenging" in terms of achieving similar rates of growth.

Oracle recorded revenues of US$615 million in the Asia-Pacific region during its third quarter ended Feb. 28, up from US$458 million the same period last year.

Mitchell said: "I think as you get larger, continuing to grow at that sort of percentage rate is somewhat difficult. We might see [future growth] a little lower than that."

In the last two years, Oracle has made a slew of acquisitions to beef up its business applications portfolio. More recently, it announced plans to acquire business performance management vendor Hyperion for US$3.3 billion.

Mitchell declined to comment on Oracle's business intelligence platform road map with the impending acquisition of Hyperion, since the deal has not been finalized.

He said: "Although we're looking to communicate what [the road map] might be, it's not possible [now], because Hyperion is still a public company and its stockholders have not voted on our offer."

The top Oracle executive for the region, however, noted that the software giant will continue to see "high quality growth" consistent with the Asian market. "We've generally grown in double digits in each quarter…and we're fairly confident that the Asia-Pacific economy will be growing."

"Asia-Pacific is the growth engine of the world, and we're taking our share of that market and growing with it," Mitchell said.

Oracle's new applications license revenues for the third quarter in Asia-Pacific grew 89 percent over the same period last year. Mitchell said this was largely driven by Oracle's lifetime application support program.

The software giant has been expanding its footprint in smaller cities in China, India and the Asean region, Mitchell noted. Particularly in China, Mitchell said, Oracle has been seeing "solid growth" in the country.

He noted that Oracle's technology approach was different compared to Chinese business applications companies like Kingdee. "We're very much a provider of technology platform architectures and applications in a packaged, modular way," he said.

The Chinese domestic vendors, however, have adopted a framework-based approach, where specific components are built and reused for different implementations, Mitchell said.

"The choice that Chinese companies need to make is whether they want a scaleable platform, or reusable code," he said. "The second difference is, we bring world best practices because we're a global company, which is probably a little bit of a challenge for some of the Chinese domestic vendors."

Provided by ZDNet Asia—Where Technology Means Business

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