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Rimini Street transforms to innovation enabler

Den Howlett Profile picture for user gonzodaddy April 16, 2014
Summary:
Rimini Street is no longer just a cost saver. It is a full stack innovation enabler. Here's why.

The last time I met with Seth Ravin, CEO Rimini Street, the company was in early stage and being hammered by a lawsuit from Oracle claiming 'illegal' use of Oracle software. For those who don't know, Rimini Street is the high profile third party maintenance (3PM) provider that is disrupting Oracle and SAP's business models with a price target of 50% of vendor maintenance costs.

Things have changed a lot in the last three years. The lawsuit trundles on but Rimini Street is now a much larger company with more than 700 contracts in place, 85 of the Fortune 500 as customers and is expanding into Asia Pacific, specifically Japan where it is already claiming success. Oh yes - and then there's the small matter of filing for an IPO.

There's more. At last week's Collaborate, the largest Oracle user group conference on the circuit, Rimini Street took the opportunity to firebomb the media with a slew of announcements. For me, the most interesting talked about cloud services and support for customers choosing to integrate both Workday and Salesforce.com customers into their existing SAP and Oracle landscapes.

While this may sound shocking to some, it is a natural extension of what Rimini Street already offers that now also includes technology support - i.e. Oracle database - something that was never on Ravin's mind when we last talked.

Transformer
It is clear that Rimini Street is now attacking the support cost issue in every area of the enterprise software stack. This is to be welcomed since it applies pressure to the vendors at a time when cost reduction is no longer a 'must do' in the context of economic constraint, but more a way to leverage cost for driving innovation. In that context, third party maintenance joins storage (EMC v Nutanix) and data center (IBM v Amazon)  commoditization that are rapidly eroding incumbent business models while delivering value back to customers.

In the above video recording - part one of a two parter - Ravin explains the company's trajectory, reinforcing the message that while 3PM might once have been viewed as the place for cash strapped companies to gain relief, it is now very much on the agenda for companies looking to innovate while deploying hybrid application software.

Ravin also talks about what he terms the 'stratification' of IT purchasing where he sees fundamental shifts in the way IT is acquired and where core systems of record (the area Rimini Street is most interested in) are commoditizing rapidly with companies not just thinking steady state but also how they can add on to existing landscapes.

It is a compelling argument the company played on successfully at the event by having a 'Transformer' at their booth that attracted plenty of photo shoot opportunists.

 Verdict

  1. There was a time when you'd have to say that companies like Rimini Street were bucketed into that pure, cost saving spot that while important was a minor part of overall tech spend. In that context, 3PM remained a discretionary item except to the extent that cash was hard to find in IT budgets. Rimini Street's current positioning changes that perception to one where it can be regarded as an innovation enabler through IT spend management. The difference may seem subtle but important.
  2. This changes the conversation to one of necessity because even now, there are very few places where IT can radically change its 'keeping the lights on' cost profile without hindering a business's ability to provide innovation services back to its end user and line of business customers.
  3. What's more, while savings may be modest in the scheme of things, they are often enough for business to take advantage of the new breed of lower cost enterprise solutions which, paradoxically, are contributing to far higher ROI than has been the case in the past. If for example I can release $100,000 for a data visualization project then heck yes - that's going to happen.
  4. Despite its legal entanglements, Rimini Street remains the 3PM bell weather company to watch. Its footprint is broadening, its customers like what they see and their forward billing book looks attractive.

Coming up: we recorded a customer conversation which will be published shortly.

Disclosure: SAP, Oracle, Workday, Salesforce and Rimini Street are diginomica partners.

Featured image credit: © Warakorn - Fotolia.com

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