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Oracle lawsuit doesn't slow Rimini Street's momentum

Chris Kanaracus | Jan. 11, 2011
Oracle's lawsuit against Rimini Street is not slowing the smaller company's momentum, as it logged its best-ever performance in the fourth quarter, according to an announcement Tuesday.

Plans remain for the company to deliver previously announced new services, including support for Oracle's E-Business Suite, it adds. Rimini Street is also mulling a potential IPO (initial public offering) in 2012.

Rimini Street pledges that customers will save at least 50% on their support bills. However, its customers do not receive all the benefits of vendor-provided support, such as product upgrades. It caters to customers with older, stable systems and little desire for new features.

Each Rimini Street client, in authorizing the company to act on its behalf, "warrants to Rimini Street that it has the rights to access Oracle's support web sites and take possession of the requested Oracle Software and Support Materials," a Rimini Street court filing states.

The materials are kept in separate data "silos" for each customer, with no commingling of downloads, it adds. "Rimini Street then maintains downloaded material only on behalf of the client for whom the download was performed."

These downloads are only done for a customer that "represents they are presently an Oracle Annual Support customer whose Oracle Annual Support period has not expired," the filing states.

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But Oracle contends that Rimini Street "typically logs on to Oracle's password protected Technical Support websites using a customer credential, then downloads Software and Support Materials in excess of the customer's authorization under its license agreement," according to its complaint. "Sometimes Rimini Street will download hundreds or even thousands of Software and Support Materials at a time, relating to entire families of software (e.g., PeopleSoft, JDE, or Siebel) that the customer does not license and for which it has no use."

The Oracle suit's outcome is likely to have a significant effect on Rimini Street's business, one way or the other. The company's future would be uncertain if its current business model is found to be illegal. But if Rimini Street is exonerated, it could spur a much larger ecosystem of third-party support providers.

Software vendors undoubtedly would not want that to happen, given their heavy dependence on highly profitable support fees.

 

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