Oracle buys ATG for $1 billion

Oracle has announced that it plans to buy e-commerce vendor Art Technology Group for about US$1 billion. The deal is expected to be completed early next year.

Share

Oracle has announced that it plans to buy e-commerce vendor Art Technology Group for about US$1 billion. The deal is expected to be completed early next year.

ATG's technology will be "highly complementary" to Oracle's existing lineup of CRM (customer relationship management) ERP (enterprise resource planning) and other software, according to a statement.

The growing convergence between traditional and Internet commerce calls for a unified technology platform that ties together all channels, Oracle said.

Moreover, e-commerce is increasingly about creating a personalized experience for customers. ATG's platform features the Adaptive Scenario Engine, described on its website as "segmentation and content targeting software that provides the personalization technology and core functionality needed to deliver a personalized customer experience at every stage of the buying process."

ATG competes with companies like GSI Commerce and Digital River. Oracle's move to buy the Cambridge, Massachusetts, company follows rival IBM's purchase of another prominent e-commerce vendor, Sterling Commerce, earlier this year.

However, Sterling Commerce is focused more on business-to-business sales. A large part of ATG's customer base is focused on business-to-consumer transactions, according to a recent Gartner report.

Oracle selected ATG for the quality of its products, as well as the fact that the companies share many large enterprise customers, according to a FAQ presentation on the deal.

ATG employees "have significant domain expertise" and are expected to become Oracle employees once the deal closes, according to a letter from ATG CEO Bob Burke to customers.

Commenting on the move, Forrester retail technology analyst Brian Walker said the deal was important for Oracle because it lacked a convincing B2C ecommerce platform.

“The trend of ‘dropping the e from eCommerce’ is something we have been talking about for some time, as eCommerce solutions are leveraged not only on the web but also in the call center, to drive mobile commerce, and increasingly in the store or branch. This is now becoming something our clients at Forrester are looking for in their next generation of commerce solutions,” Walker noted.

“For Oracle this trend was beginning to present a threat as they lacked a capable B2C oriented eCommerce platform. For ATG this represents a response to the moves IBM and GSI have made to develop cross-channel enterprise commerce solutions.”

It was not immediately clear Tuesday how ATG's technologies will coexist with Oracle's own e-commerce products, such as Siebel E-Commerce 8.1.1.

Oracle is currently evaluating ATG's product road map and will update customers at a later time, according to a statement.