April 24, 2012, 7:02 PM — Most of the 250 customers that have licensed Oracle's recently launched Fusion Applications so far have chosen a SaaS deployment model instead of running it on-premises, a senior executive said this week during the Collaborate user group conference in Las Vegas.
And they are doing so "in a coexistence fashion," running Fusion alongside their existing Oracle business software, such as E-Business Suite, and looking to add more Fusion modules over time, said Chris Leone, senior vice president of applications development, during a keynote address.
Fusion Applications were Oracle's first to be designed specifically for cloud-based delivery, not only to give customers the option but to help Oracle itself run a SaaS (software-as-a-service) business profitably and more easily, Leone said.
For one, Fusion Applications have an extensibility layer that allows "upgrade-safe" tweaks to the user interface and process flows, a crucial component for any SaaS vendor, since major updates are applied to many customers at once, allowing for substantial cost savings.
Oracle is giving customers on its older ERP (enterprise resource planning) product lines software license credits for "like-to-like" functionality when they switch to Fusion Applications, Leone said after the keynote. Customers can also work with Oracle to factor and credit money they're now spending on annual maintenance payments into the cost of SaaS subscriptions for Fusion Applications, he said.
An IT professional who has worked with Fusion Applications said SaaS is the way to go, at least for now, given the headaches of running it on-premises.
"If you wanted to run Fusion Applications in your company, for the next two years, the only way I would do it is with Oracle hosting," said Michael Brown, technical manager at consulting firm Colibri Limited, during a presentation this week.
Brown's talk covered the complex task of installing Fusion Applications on-premises, which requires a multilayered identity management framework along with a sheaf of other Oracle middleware, as well as servers with large amounts of main memory.
"These are not cheap servers when they are configured this big, and most of us don't have them lying around" for testing and configuration purposes, Brown said. "If you are running a small E-Business Suite system, which a lot of customers are, you don't have enough headroom for Fusion [Applications]."
Global systems integrator and E-Business Suite customer IT Convergence is one early Fusion Applications adopter. It began its implementation of Fusion HCM (human capital management) software in March, while simultaneously participating in a beta program for E-Business Suite 12.2, said CTO Gustavo Gonzalez during a presentation at Collaborate.