"We thought the only way we could survive and prosper was through an acquisition strategy," Ellison testified before the crowded courtroom in San Francisco. "Oracle had to consider a strategy we had never considered before. If we wanted to survive and grow," the company decided, "we will have to start an acquisition strategy. PeopleSoft was on top of the list." Oracle had considered takeover of other companies, including BEA, Siebel Systems, and Business Objects, but focused on PeopleSoft because it had the largest number of customers.

Ellison denied that Oracle's intent was to harm its rival PeopleSoft by creating confusion with a hostile bid. If the merger does not go through, said Ellison, "We would have wasted a tremendous amount of money and time. It would have been a big mistake."

Ellison affirmed that Oracle was trying to acquire PeopleSoft's customer base, not its technology, as an enlarged customer base would encourage Oracle's development of improved and lower-priced products. "This is not about PeopleSoft or its technology. It's about buying customers. He (Ellison) was very blunt about that," commented Justice Department lawyer Renata Hesse. The U.S. Department of Justice has tried to block the takeover, which it claims is anti-competitive, would result in higher prices, and would stifle innovation.

Ellison testified that Oracle's earlier merger attempts with PeopleSoft failed because PeopleSoft CEO Craig Conway wanted to head up the new company. PeopleSoft claims that the deal collapsed because Oracle wanted its business applications to run only on Oracle database products, which was unsatisfactory to PeopleSoft. Final arguments in the trial are scheduled for July 20.

• Ellison Triumph: Oracle Can Proceed with PeopleSoft Takeover Bid, Court Decides
• Oracle's PeopleSoft Takeover Bid Can Go Ahead, Judge Rules
• Will Oracle Bid for HP?
• Oracle Unveils Its Exalogic Elastic Cloud