IOUC POSITION STATEMENT

EOUG Conference&Exhibition MADRID 2000

Version 2, 9th June 2000

INDEX

Executive Summary

  1. Review of the objective.What Oracle Wants
  2. How Oracle UGs have developed to date
  3. Activities undertaken by Continental UGs since April
  4. Continental UG assistance with OOW events
  5. Continental UG view of continuing own events
  6. Impact on Continental UG events of withdrawal of Oracle input
  7. Possible structures for an ‚Official’ Global User Group

This Position Statement provides the considered response of the IOUC
Board to the proposals made to it by Oracle Corporation on 16th-18th April 2000.

EXECUTIVE SUMMARY

  1. The IOUC Board has carefully considered the proposals made by Oracle and assessed the
    objectives against the potential benefits to the existing User Group community.

  2. Knowing the varying structures of the current User Groups, both ‚Grass Root’ and
    Continental, it considers it unlikely that a unified approach could be achieved in the
    short term.

  3. Work has commenced on specifying a Global Portal to provide links and potential access
    to data held by any Oracle user group which wished to be included.

  4. The Continental UGs are willing to offer ‚Web Only’ membership in order to build up the
    membership of Oracle User Groups globally. They will also encourage Grass Root Oracle user
    groups to offer such an option.

  5. In order to attempt to achieve the growth desired by Oracle, the User Community globally
    now needs access to the contact lists held by Oracle which have been built up via OTN,
    AppsNet, Club Oracle etc

  6. Information has been collected on how much support Grass Root user groups currently
    receive from Oracle.

  7. The Continental UGs are prepared to assist Oracle in any way to develop and strengthen
    the support provided by Oracle to Grass Root user groups in order to stimulate their
    growth.

  8. Each Continental UGs has also expressed its willingness to assist in staging OOW events
    as long as there is firm contractual commitment from Oracle. No proposals have been
    forthcoming from Oracle since the April meeting.

  9. The Continental UGs believe they should continue to stage their own conferences. There
    are significant differences between OOWs, which are seen as being essentially about Oracle
    futures and marketing, compared with events staged by UGs which are about exchange of
    information Best Practice in the use of existing Oracle products.

  10. The Continental UGs recognise that the withdrawal of Oracle’s input to their events
    could have a severe impact their financial viability.

  11. Having considered the pros and cons, the Continental UGs see no particular benefits for
    either the Grass Root user groups or the Continental UGs in moving away from the present
    structures at this point in time.

This Position Statement provides the considered response of the IOUC
Board to the proposals made to it by Oracle Corporation on 16th-18th April 2000.

Since then, there have been a number of conference calls, and time for
each member group of the IOUC, to reflect on the proposals and how they would impact their
current operation. But first, it is useful to remind ourselves of the main points of
Oracle’s proposals.

1. Review of What Oracle Wants

  1. Oracle wish to see the formation of an ‚Official’ Oracle User Group to which all other
    Oracle user groups are affiliated. They see this as being essentially a Web Based User
    Group with the members paying minimal membership fees. Oracle believe that the membership
    of an ‚Official’ user group would be significantly larger than it is under the present
    arrangements.

  2. Oracle recognises that for this to happen, the current Continental User Groups,

    i.e. the IOUG-A, EOUG, and APOUG and some of the larger ‚Grass Root groups would need to
    adopt different business models from the ones through which they are presently funded.
    Oracle is willing to commit support from its business analysts to help construct such a
    model.

  3. If the User community adopt this new model, Oracle would give it access to the large
    number of contact addresses it collects via OTN, Oracle Club, Oracle Apps Network, etc.
    This they estimate to be in excess of 700,000 contacts.

  4. Oracle considers that access to all User Group information should be provided through a
    single Global Portal.

  5. Oracle intends to reduce the support it provides to the current ‚Continental’ User
    Groups. This means providing fewer, if any, Oracle speakers for events and having reduced,
    if any, presence on the Exhibition floor. Ideally, Oracle wishes that the Continental
    UGs would cease to run conferences so that without that competition, more Oracle customers
    would attend OOWs

  6. Oracle intends to concentrate its resources on running Oracle Open World events and
    wishes the current Continental Groups to play a role in selecting the User Papers that
    would be presented at OOWs. Oracle is prepared to sign contracts with the Continental User
    Groups to confirm this.

  7. Oracle wishes to promote the growth of the ‚Grass Root’ user groups. ‚Grass Root’ user
    groups are taken to mean;

    i) State Oracle User Groups in the USA, e.g. the Ohio Oracle User Group
    ii) Company or Organisation Oracle UGs, e.g. Boeing or NASA UGs
    iii) National Oracle User Groups world wide, e.g. UK Oracle User Group,

  8. Oracle wishes to strengthen the support it gives to Grass Root groups, via a mixture of
    financial help and Oracle speaker support. This may be funded by Oracle Marketing. (This
    area of Oracle’s proposals are unclear)

2. How Oracle User Groups have developed to date

Before considering alternative structures, it is worth briefly
reviewing how Oracle User Groups have developed to date.

Historically the so-called Grass Root Oracle User Groups have been
formed in a largely ad hoc manner, as and when the local community of Oracle customers saw
the need and benefits of meeting together to exchange experience. The criteria for
sustainability and long term success have been;

  1. The number of Oracle customers existing within a geographical area which made occasional
    meetings worthwhile and economically viable.

  2. Volunteer enthusiasm and their willingness to commit a substantial amount of personal
    and company time to the venture.

  3. Willingness of the local Oracle office to support local development of such a group as a
    method of promoting longer-term customer satisfaction and growth

  4. A national culture which made the development of such a group acceptable.

The form of Oracle User Groups which evolved having met such criteria
vary significantly.

It ranges from those with 20 or so members, paying no fees but meeting
occasionally and benefiting from an exchange of knowledge, to large groups with thousands
of members paying anything up to $600 per annum to belong, but meeting regularly for
precisely the same reason.

Some of these Oracle User Groups have become independent trading
organisations with their own staff, legally registered with the appropriate authorities in
their country and paying appropriate taxes.

In addition to these ‚Grass Root’ groups, the current Continental User
Groups were formed, (i.e. IOUG-A, EOUG, APOUG & OAUG). It is estimated that between
30%-40% of members of these organisations do not belong to ‚Grass Root’ UGs.

These too vary in their structure. Most of the Grass Root groups are
either members of a Continental User Group or affiliated to them.

In 1994 in Maastricht, Oracle saw the advantage of formalising regular
meetings of these Continental Groups by forming the IOUC. Since then, Oracle has
recognised the IOUC as being the voice of the Oracle User Community world-wide.

With all the support we have had from Oracle over the years, none of
these groups have ever regarded themselves as ‚Unofficial’.

Without doubt, the current Oracle User community has been one of
Oracle’s strongest advocates and ardent supporters. Arguably it has been one of the
factors in bringing about Oracle’s phenomenal success over many years. The Oracle User
community has simply been proud to be associated with a winning side!

3. Activities undertaken by the Continental Groups since April 2000

  1. Jointly
    Drafting the specification for a Global User Group Portal
  2. IOUG-A
    The matter was discussed by the IOUG-A Board following an appearance at their Board
    Meeting in Anaheim by Mark Jarvis. There has also been a subsequent meeting between
    representatives of the IOUG-A, Ray Lane and Mark Jarvis where the matter was discussed.

  3. EOUG
    Briefing paper sent to EOUG Directors and NAC members.
    Questionnaire sent to NAC members requesting a statement of the current support their UG
    receives from Oracle.
    Scheduled as a main topic for discussion at the NAC Meeting at the EOUG Conference in
    Madrid in June.

  4. APOUG
    Questionnaire sent to NAC members requesting a statement of the current support their UG
    receives from Oracle.

4. Continental UG assistance with OOW events

Each of the Continental UGs have expressed their willingness to assist
in these events in any way they can. But there needs to be on a firm contractual
commitment from Oracle and no proposals have been forthcoming from Oracle since the April
meeting.

5. Continental UG view of continuing with their own events

The IOUG-A and the EOUG believe they should continue to stage their own
conferences. APOUG also wish to continue to develop regional conferences. So does nearly
90% of the membership of the OAUG!

We believe that there is a significant different between an OOW and an
IOUG-A Live or an EOUG Conference or an OAUG Conference. OOWs are undoubtedly regarded as
essentially Oracle Marketing events with the focus on future products and directions.

The major User Group events focus on Best Practice in the use of Oracle
products that customers have already purchased. This group increases year by year as
Oracle’s customer base grows. The two events provide different foci and are in fact
complimentary

In a recent press report regarding Oracle’s intention to run an Oracle
Applications World event, as competition for OAUG Conferences, Larry Ellison was quoted as
saying that it was..’About offering customers choice’. Precisely so, and if the IOUG-A,
EOUG, APOUG & OAUG did not stage their events, Oracle customers would be denied such a
choice. Which reminds one of where Microsoft started to go wrong.

6. Impact on Continental UG events of withdrawal of Oracle input

Obviously Oracle has the total right to decide what resources it will
commit to supporting Continental UG events. It is a straightforward business decision. But
it seems to us less than good business sense that a major company in the fiercely
competitive IT world could afford to completely ignore a gathering of some thousands of
its customers and potential customers.

However the Continental UGs have to assess the impact of this real
threat. The most likely impact would be whether some Oracle Partners would exhibit if
Oracle are not present. The Continental UGs will thus undertake some ‚What If’ analysis of
possible scenarios.

7. Possible structures of an ‚Official’ Global User Group

The structure of an ‚Official’ Global Oracle User Group is still
unclear and various options are possible, each with its pros and cons. The IOUC’s
response must be to consider which option best fits the needs and wishes of its member
and/or affiliated user communities.

The following seem to be the main options;

Option 1) That an entirely new ‚Official’ Web-Based Oracle UG be
formed, and that during a period to be determined, all existing Oracle User Groups change
their business models and affiliate to it.
Option 2) That the existing Continental and Grass Root UGs remain as currently
constituted but offer Web Only as one of the options for membership. The Continental UGs
could also take on an additional role of administering and distributing whatever support
Oracle wishes to fund centrally.
Option 3) Status Quo, which Oracle state is not an option

Let us now consider the points For & Against of each of the
Options above.

Option 1) New ‚Official’ Web-Based Oracle UG

For 1; Proposed as being low cost of membership therefore likely
to attract significantly higher membership.
Probable but unproven. Oracle products are aimed at businesses of all sizes, not the PC
user market. The fact that OTN etc receives thousands of hits does not mean that a high
percentage of these contacts would pay anything to become members of a Web Based Oracle
User Group. Membership of a user group tends to be a corporate decision based on the
perceived value of belonging.
For 2; Would result in a unified, easily branded body.
Unification would not be easy, too many turf issues to be resolved.globally!

Against 1; All Oracle User Groups would have to change their
membership and fee structure.
Neither Oracle or the IOUC has the power to force the UGs to become Web Only organisations
and the advantages of changing are not yet perceived to be sufficient to justify the
upheaval.
Against 2; Highly likely that such an organisation would be perceived as being
controlled by Oracle, therefor losing its independent voice to raise issues of concern
with Oracle
Of real concern. A collective independent voice which is respected by the supplier is
regarded as one of the major reasons for belonging to any UG.

Option 2) That the existing Continental UGs and Grass Root
Groups remain as currently constituted and offer Web Only as one of the opportunities for
membership

For 1; Less upheaval overall
All existing Oracle UGs could continue with their present mode of operation, and
additionally offer Web Membership to achieve the higher membership we all seek.
For 2; Continental UGs could take on a role of administering and distributing
Oracle support determined by defined criteria. This would offer some consistency in the
support received by Grass Root groups locally
Would be seen as a very positive step for Grass Root Groups many of which receive little
or no from support from their local Oracle office, but it would add an administrative
workload for the Continental Groups.
For 3; Allows opportunity for the UGs to be provided with Oracle contacts collected
via OTN, Club Oracle, etc

Against 1; Only goes some way to deliver one of Oracle’s main
objectives, an easily identifiable but unified organisation.
True, but some of this could be achieved by some re-branding. For instance, if a major
objective is to have an identifiable ‚Official’ UG image, the following re-badgeing would
go some way to achieving it;
The EOUG could be re-badged, The Oracle User Group – EMEA
The IOUG-A could be re-badged, The Oracle User Group – Americas
The Ohio Oracle User Group could be re-badged, The Oracle User Group – Ohio
The Swiss Oracle User Group could be re-badged, the Oracle User Group – Switzerland
The ODTUG could be re-badged, the Oracle User Group – Development Tools etc, etc.
Against 2; Does not embrace the opportunities for growth offered by the Web fast
enough
But does offer a valuable compromise solution that would allow us to easily test the
growth of Web Only Membership.

Option 3) Status Quo
Not worth discussing further since Oracle have stated that they do not regard it as an
option.

Rich Niemic, IOUG-A
Merrilee Nohr, IOUG-A
Anthony Speed, APOUG
Erich Wessner, EOUG
Bert Spencer, EOUG