Ronald Danielson of Santa Clara University is closely watching Oracle's hostile bid for PeopleSoft.

The school has invested five years installing PeopleSoft software and training people to use it. Now, weeks before students go live on a Web-based application that allows them to do everything from ordering transcripts to paying tuition bills, Danielson, the university's chief information officer, worries about the fallout.

``If Oracle were to succeed in the takeover and phase out PeopleSoft software, we would have to go through another implementation of another administrative software suite,'' Danielson said. ``That makes me really uncomfortable.''

PeopleSoft is relying on its customers to help it ward off Oracle's $5.1 billion takeover offer. The Pleasanton software maker today is running newspaper advertisements highlighting its satisfied customers -- including Toyota Motor and Nextel Communications -- who praise PeopleSoft's ``integrity'' and bluntly call Oracle's $16-a-share bid ``a failed attempt'' at eliminating a competitor.

When Oracle chief Larry Ellison's initially declared his intention to phase out PeopleSoft products if he succeeds in his takeover bid, corporate technology managers suddenly found themselves unsure of what would happen to their investments. To soothe customer concerns, Oracle on Tuesday emphasized that it would continue to support PeopleSoft current software and provide a way to move gradually to Oracle products.

``The deal only works if we can retain a majority of the customers,'' Oracle Executive Vice President Chuck Phillips said in a Webcast with investors and analysts. He said PeopleSoft customers will get a free license upgrade so they can swap to Oracle products. ``We think that will make it tough for competitors to come in.''

The applications the two companies sell automate vital business functions such as accounting, human resources, purchasing and inventory. They cost millions of dollars and can take years to install and implement. Customers say that switching to another provider of enterprise applications would create major upheaval.

At issue for PeopleSoft customers is whether the company will be swallowed by Oracle or succeed in pulling off its own friendly acquisition of smaller rival J.D. Edwards.

The competition

For years Oracle, PeopleSoft and their larger competitor, SAP of Germany, have competed for customers.

SupportSoft, a Redwood City tech company that provides automated technical support systems, chose PeopleSoft over Oracle.

``At the time, it was much easier to swing a deal with PeopleSoft at an affordable price,'' said Mark Vranesh, the company's vice president of finance.

Golden Gate University in San Francisco, however, found Oracle to be a better fit for its 6,000 students and 1,000 faculty members.

``Oracle had the most cost-efficient deployment model,'' Chief Technology Officer Anthony Hill said. ``Now we have money to spend on other things, like the Web site.''

ChartOne, a San Jose company that provides medical chart technology for hospitals and clinics, uses PeopleSoft's products. Chief Financial Officer George Abatjoglou can't recall from one day to the next what Ellison and other Oracle officials have said about supporting the customer.

``I think it's a terrible deal the way Larry Ellison is laying it out there,'' he said. ``When you buy a technology company, you buy it for its customers and technology. If Larry Ellison is going to throw away the technology, then you're down to the customers. And I don't think he'll be able to keep them.''

Bruce Richardson, senior vice president of AMR Research, said Tuesday that Oracle made some early mistakes communicating with customers.

``One mistake that I think Oracle made was treating them as if they were nothing more than a checkbook,'' he said. ``Oracle needs to make sure that PeopleSoft customers are happy. Why would anyone want to go into a hostile customer base?''

Rooting interest

Toyota Motor, which is featured in today's PeopleSoft ads in the New York Times and Wall Street Journal, said it is rooting against the deal. ``We're not being critical of Oracle, although I'm disappointed in the way they are doing this,'' said Jim Bolte, vice president of information services at Toyota's North American manufacturing division. ``It's a huge impact on us if it goes through and, just for my own sake, we don't want to switch.''

``I think the position that Oracle took by not supporting the technology or showing interest in it is an untenable one for PeopleSoft customers,'' said Laurie Orlov, a Forrester research director. ``You're asking customers to destabilize their businesses for no good reason, from the customer's point of view.'' She said the best strategy for PeopleSoft customers is to band together and make a coherent case to PeopleSoft shareholders against Oracle's bid.

Despite the public support, PeopleSoft's second-quarter profit and sales will suffer as clients wait to see whether the company will buy rival J.D. Edwards or be acquired by Oracle, analysts with U.S. Bancorp Piper Jaffray warned Tuesday.

``We believe that near-term uncertainty will cause some freezing in decisions in the market,'' the analysts wrote.

For the quarter ending June 30, the firm cut its estimate of license revenue to $80.3 million from $88 million and total revenue to $453.5 million from $461.4 million, and reduced per-share earnings by a penny to 11 cents.