During the same week that Siebel reports a loss of over $59M it also announces that it is buying two other software companies: Upshot, a hosted CRM provider, and Motiva, an incentive compensation software vendor.
The loss of over 18% of revenue is especially troubling as business is definitely picking up among other major software vendors, such as SAP, which just announced increased positive earnings in the most recent quarter and a jump of 35% in revenue in the U.S. market.
Siebel evidently sees the hosted CRM market as a threat to its CRM franchise, especially at the low end of the market, where most of the real opportunities are today. CRM, and especially the sales force automation (SFA) part of CRM, is one of those applications that is natural for the Application Service Provider (ASP), or hosted, model. Users are mostly sales people in the field and the Internet based architecture works well for them. Siebel was already moving in this direction with its CRM OnDemand offering. Siebel's grab for Upshot just moves things along quicker.
Siebel's acquisition of Motiva is a smaller deal ($3M) that just fills out functionality for Siebel's offerings.
has an article on Siebel's weak financial performance. eWeek
has details on Siebel's latest acquisitions. Information Week
has a report on SAP's continued strong performance.