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Oracle to Cut Staff

Oracle plans to layoff 2,000 staffers, or 3.5 percent of its workforce, as a result of the acquisition of customer relationship management software maker Siebel Systems.

Oracle, which closed the Siebel buy last week, said it will retain more than 90 percent of Siebel's product development, product support and sales teams.

Once the integration is complete, Oracle will have a global workforce of about 55,000 employees, said company spokesman Bob Wynne in a statement.

Wynne, who also said Oracle's integration of Siebel is proceeding on schedule, said Oracle has begun notifying employees of the terminations and expects to complete the layoffs over the next few weeks.

In a briefing with financial analysts, Oracle President and CFO Safra Catz said the Redwood Shores, Calif., vendor expects software licensing for the current quarter will grow by 15 percent to 20 percent from the previous year.

Third-quarter profit is expected to be between $706 million to $734 million, Catz said.

Some analysts had been expecting more layoffs upon the closing of Oracle's $5.8 billion purchase of the company. Many still question whether or not the company can cleanly tuck Siebel's CRM applications into Oracle's E-business Suite.

But the company has a bit of experience integrating disparate applications. Last year, Oracle made a solid showing by integrating PeopleSoft and J.D. Edwards's products into its portfolio.

The Redwood Shores, Calif., company has been making buys at a rapid clip and plans to bundle its existing middleware, such as Application Server and Database Server 10g, with its wealth of applications in an effort it calls Fusion Middleware.

The idea behind this strategy is to help corporations build service-oriented architectures (SOA) to more efficiently manage their computing tasks.

Oracle isn't done acquiring, according to comments CEO Larry Ellison made at various events in the last few weeks. Buzz is building that the software giant has set its sights on open source vendors.

BusinessWeek reported that Oracle could land on application server maker JBoss, Web site language provider PHP, or even database maker SleepyCat Software.