PeopleSoft called off its legal dogs last week, but the company is still not happy about Oracle's takeover bid.

PeopleSoft, which planned to take on Oracle with its intended buyout of J.D. Edwards, plotted court action against the database giant, but soon backed down. PeopleSoft CEO Craig Conway is seriously concerned about the effects Oracle CEO Larry Ellison's announcement of the hostile takeover offer will have on his company.

Conway had spent most of the previous week explaining to shareholders how the union with J.D. Edwards would expand the company's customer base and allow it to compete with Oracle and SAP. Conway was looking forward to gaining a secure foothold in other market such as manufacturing, where J.D. Edwards holds firm.

But then, at the end of the week, Ellison turned the tables on Conway. He wanted to add PeopleSoft's people and products to the Oracle empire for $5.1 billion. This announcement stopped the J.D. Edwards deal cold and left customers and shareholders alike in the lurch.

Conway went to the press immediately and expressed his disdain for the offer. Then he visited the lawyers and began to push them to get PeopleSoft free from this mess.

But in the end, Ellison, who says he's doing this all for the future of Oracle, is hoping for a visit with the PeopleSoft board.

Ask IT managers in casual conversation what they think of this debacle and they visibly wince. They don't like the tactics Ellison took to thwart the J.D. Edwards deal and they're not convinced it's not ego.

But then again, they say that PeopleSoft would add great value to Oracle, helping the company to really focus on customers and boost its portfolio of customer relationship management and business process management tools.

They also mark it as the start of another round of industry consolidation. Whether this consolidation is good depends on whether the companies that will likely be left standing will listen to customers and decrease the complexity of their products.