September 8, 2003

Oracle putting different spin on an old strategy

- by Chris Preimesberger -
SAN FRANCISCO -- The date was June 14, 2001. I remember it well; it was a hot, sunny day on the banks of the San Francisco Bay. Larry Ellison was explaining to a packed house of journalists, analysts, and assorted hangers-on at Oracle headquarters that the Oracle 9i he had just introduced was -- and I am quoting verbatim -- "the last database you'll ever need."

I couldn't resist calling him on this a few minutes later at a Q&A session. "If Oracle 9i is the database to end all databases, are you then saying that Oracle is forgoing any future versioning of the product?" I asked.

Ellison looked surprised before backtracking. "Well, what I meant was, 9i is the best there is right now," he said. "Of course there will be a 10i, and 11i, and a 12i, but we think this is a important-enough release. The idea that we could deliver fault-tolerance on personal computers -- the idea Oracle could make Windows more reliable than IBM mainframes -- is weird. It's a very strange way to look at it, but statistically it's true."

Well, okay. Oracle database version 10 has been introduced (it is set to be released at the end of the year), and it's not even 10i. It's called 10g, for grid computing, which is the new market spin Oracle is putting on an old topic for the business market: buy lots of cheap computers, use their "unbreakable" database, application server, and management software, and you'll have a network that will never go offline.

That contention, of course, is ripe for debate.

Oracle to explain grid computing strategy

In any case, OracleWorld opened today at the Moscone Center with a horde of developers, analysts, customers, journalists, and various others jamming the underground conference center. Chief Executive Ellison will explain his company's new message in a keynote tomorrow afternoon. Meanwhile, people were wearing T-shirts with the large word "GRID" emblazoned on them while walking to and from some of the various seminars and workshops held on Day One.

In short, grid computing is something that other companies -- namely Microsoft and IBM -- have been talking about for a few years. The idea is that companies can save money immediately by using existing computers together with inexpensive newer computers in a fail-safe network powered by a high-end central database and application servers. This opposes the conventional thinking that companies have to purchase more -- and more powerful -- computers and software every few months, laying to waste the previous versions of expensive software and hardware from last year.

Grid computing theoretically allows better control of the ebb and flow of business demand by allocating more available servers and throughput for peak times in business cycles. For example, companies whose payment processing demand will be highest during the four weeks before Christmas can pool resources at slower times of the year to allow for maximum grid power during the Christmas rush.

Oracle vice president Charles Phillips said the time is "ripe" for grid computing concept to succeed in mid-size to large businesses because of the glut of low-cost computers on the market, namely those from Dell, IBM, Hewlett-Packard, and others that cost $2,000 or less. "These smaller, cheaper computers and the Linux operating system have laid the foundation for grid computing," Phillips said.

Another advantage of grid computing, Phillips added, is that companies can "pay as they go" in adopting the technology at their own pace. "Gradually they can replace big, expensive servers that act as 'islands of computation' with cheaper computers that share processing power over the grid," he said. Software developers and business applications companies "don't have to make any changes to that application to take advantage of the grid," Phillips said.

Michael Dell meets the press

Michael Dell, founder and CEO of Dell Computer Inc., who delivered Monday's keynote address on crutches (he broke an ankle when he fell off a horse, and the horse stepped on him), met journalists in a brief session following the speech. "Contrary to what I may look like today, we've never been on more solid footing as a company," he quipped at the podium.

Dell's main news in the keynote was that Dell is now ensconced in talks with other hardware manufacturers in an attempt to come up with architectural standards for so-called "blade server" computers. "There should be a common blade architecture," Dell said. "If we are successful, and I am reasonably optimistic we will be, I think you will see a high-volume market for these blades."

At the news conference, Dell didn't reveal much that was newsworthy, but he did say that his company has seen a 71% growth in sales in China this quarter over last year. "They've bought 15 million computers over there in the last year; that's a huge change from four or five years ago," Dell said.

Dell said he's very optimistic about the overall economic recovery in the United States and around the world. "We've seen a 27% increase this year over last in units sold, and we've had increases for 11 quarters in a row," he said. "And we're not the only ones reporting well; I think IT in general has turned the corner and is heading back up."

Unlike many high executives, Dell apparently knows what's going on at the customer level. When I asked him if he knew that some of the new Dell computers won't let users read and sign off on their end user licenses very easily (the welcome screen asks users to touch any key to approve the end-user license -- but doesn't show the license language), Dell nodded and said he knew about it.

"If any of our customers has a problem with this, and I've heard of a few instances of this, we'll take care of it," Dell said. "We certainly don't want people signing anything they haven't read."

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