Oracle, while announcing a 5,000 workforce reduction as part of its acquisition of PeopleSoft, also outlined broad development strategy.“The PeopleSoft development team will finish the development and deployment of PeopleSoft version 8.9, and then begin development of the next upgrade to PeopleSoft products, version 9.0,” the company said in a statement. “The PeopleSoft support teams, with the assistance of the Oracle support organization, will continue to support PeopleSoft customers around the world. “By retaining the vast majority of PeopleSoft technical staff, Oracle will have the resources to deliver on the development and support commitments we have made to PeopleSoft customers over the last 18 months,” said Oracle CEO Larry Ellison. The company said that detailed information about Oracle’s applications organization, product plans, and go-to-market strategies will be presented to customers and partners next week at the launch of the combined applications business. Oracle completed its acquisition of PeopleSoft on Jan. 7, following the completion of a tender offer in which more than 97 percent of PeopleSoft’s shareholders tendered their stock. InfoWorld’s Ephraim Schwartz looked at implications for Oracle in a blog Friday as follows: If there is any bright spot in the news that Oracle is laying off 5,000 former PeopleSoft employees, it is that the layoffs will be distributed world wide. “When you look at where the redundancies are coming from they come from field offices where there is overlap with non-strategic, back office functions,” said Josh Greenbaum, principal analyst with Enterprise Applications Consulting. Greenbaum noted that yesterday at the former PeopleSoft office in New Zealand, Oracle laid off about 30 of the 40 employees. In addition, over the last year, PeopleSoft picked up a great many international employees when it acquired J. D. Edwards. Once the dust settles, Greenbaum sees a number of challenges ahead for Oracle as they absorb PeopleSoft. “The number one challenge is customer retention,” according to Greenbaum. Oracle needs to keep PeopleSoft customers happy and signing up for maintenance licenses in order to pay for new product development. Oracle also has a new market and the real value will come from up sell and cross sell to all of those PeopleSoft enterprise users. From a cost structure, Oracle also needs to get all of its users onto a single platform as soon as possible. The alternative is to support three platforms, its own, J.D. Edwards and PeopleSoft.(by Jack Mccarthy) Technology Industry