TOA Deal Will Speed Oracle's Move to the Cloud in Field Service Management

G00269489

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Summary

TOA Technologies will provide Oracle customers with a modern, cloud-based field service management solution. Directors of field operations and CIOs considering a cloud model should evaluate the TOA product.

News Analysis

Event

On 31 July 2014, Oracle announced that it has signed an agreement to purchase TOA Technologies, which provides cloud-based field service management technologies and business applications. Oracle did not disclose the financial terms of the acquisition.

Analysis

The acquisition gives Oracle a leading native-cloud application that will complement Oracle software for field service and customer service and support. TOA is one of only two leaders on the Gartner "Field Service Management Magic Quadrant." Gartner estimates that TOA had revenue of $50 million during the most recent four quarters. The TOA application focuses closely on the "mobile first" needs of field service technicians, and also offers highly rated field force optimization software for dispatch and debrief. These functions have appealed primarily to cable providers and telecommunications firms. The company has a strong customer base in the U.S., western Europe, Latin America and South America. Gartner estimates that 50% of TOA's 75 customers are also Oracle E-Business Suite (EBS) or Siebel customers.

Like many acquisitions, this one raises questions regarding product positioning. Oracle Real-Time Scheduler competes with TOA, and is managed by the same team that maintains the Siebel software. The Advanced Scheduler application within Oracle EBS also competes with TOA. We expect Oracle to continue to maintain its own products and offer customers a transition to a cloud alternative during an upgrade cycle. TOA will be a part of the Oracle Customer Experience (CX) Cloud, specifically within the Oracle Service Cloud development team. We will monitor whether Oracle retains TOA developers and professional services. Central to the success of the acquisition will be Oracle's near-term retention of the TOA executive management and development organization, as well as the sales organization. The sales organization has knowledge of many significant customers, as well as proven, competent partner connections that have led TOA into global deals.

Since Oracle announced its planned acquisition of RightNow Technologies in October 2011, it has continued to purchase CRM applications that are native to the cloud. These include BigMachines in October 2013, Responsys in December 2013, BlueKai in February 2014 and LiveLook in June 2014. These and other cloud acquisitions for sales, marketing, customer service, social and field service functions have refreshed Oracle Business Applications, and will help Oracle transition to a new generation of products and a subscription-based business model.

Recommendations

Directors of field operations and CIOs:

  • If you are rolling out TOA, lock in current pricing to mitigate upward pricing risk; do not expect Oracle to make immediate changes to pricing or support.

  • If you have invested in Oracle applications and wish to move to the cloud for field service, assign heavier weighting to TOA over other products in your decision-making process. If you are invested in on-premises solutions for field service, consider alternatives to TOA products.

  • If you use Oracle field service applications, prefer a cloud model and require advanced scheduling for complex field forces, migrate to this product at the next upgrade cycle unless it is missing key functions (such as rostering and long-term planning). If you prefer on-premisse applications, consider alternatives.

  • If you are seeking advanced scheduling for complex field forces and prefer a cloud model, shortlist this product while also evaluating alternatives.

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