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Oracle slams IBM with 9i release

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Ken Jacobs, on a whistle-stop run through the UK, came to the IT-Analysis offices to explain his take on Oracle - and to give us a sneak preview of the 9i release later today. Price cuts, clustering and complaints about 'IBM's misinformation' was the message.

I've been having a look at your homepage recently and it seems full of more spin than the Labour Party, are you getting desperate for revenues?

No one's ever accused Oracle of being shy that's for certain. And yes we are undoubtedly focussed on increasing revenues but who isn't? The point though is that we support our claims with facts. Recently there has been a lot of misinformation from IBM and Microsoft about database pricing but we are very competitively priced. If you look at the competition, once you've actually bought all of the components you need, Oracle is actually a lot cheaper. Further to that, today's 9i announcement will come with some low-cost pricing options. We are being very competitive. We want Oracle to be the low-cost option that is easy to install and maintain.

Okay so tell me about 9i.

This is obviously a big release for us. The 9i product comes with more than 400 new features and much of the focus for this release is on lowering costs, providing scalability and availability and making it easier to manage.

So what have you done to tackle those issues?

Well, we have included a new management interface, Oracle Data Guard, which provides protection against human errors and natural disasters. It has self-tuning facilities and technologies that take a lot of the drudge work out of administration. Things like rollback, memory management, managing logs and such like has all been automated and we have found that this should reduce the DBA burden by as much as 40%. There is also a raft of Business Intelligence enhancements in there too. The traditional cost of business intelligence was very high so 9i has OLAP ETL tools and other facilities built in. The whole thing can now be done with a single pass, using a single repository and that's a big boon.

And what else can we expect from 9i, I understand that clustering is a big push this year?

The big news is clustering, the Oracle Real Application Clusters, that will take scalability and availability in to new areas. It's going to be a lot more cost effective for the organisations that use our products too. This can be used to deliver new levels of scalability to applications.- and no one can compete with that.

But haven't IBM and Microsoft already tackled that?

To be honest I'm pleased that these two have been talking about their clustering technologies because, with one look at ours, people will see that our developments are far more significant, we are offering transparent scalability. We are reducing the cost of ownership considerably by enabling organisations to cluster just about anything, Intel boxes, Linux boxes, a multitude of configurations, and that saves the customer the expense of running mainframes.

That sounds like an assault on IBM's home-turf?

IBM is in a desperate situation right now. DB2 is not gathering ISV support, its Unix business isn't as robust as ours and mainframe sales are in jeopardy. IBM has support for DB2 from HP, Sun and such like, but it can't make substantial gains in this (Unix) space for account management reasons. If a Sun salesperson sells DB2 it opens the doors to IBM account managers who will come in and try and sell IBM hardware - that's not appealing. As such, IBM might make a few percentage gains in the AIX space, which is fine, but the rest will be a major struggle.

Explain how you see the mainframe business exactly?

You've just got to look at the market applications are not being deployed on mainframes. SAP and Computer Associates are shifting people away from mainframes onto Unix because mainframes are just too expensive. And that leaves the ground open for us to move in with our new clustering technology. It's a simple market forces thing, mainframe sales are slipping and IBM can't do anything to stop that. They will try and fight us in the Unix space but we'll be taking the honours, we've been growing revenues very fast in this space. IBM's technology is years behind us. Just look at the 7.2 DB2 release, its got features we had in 1998.

So it sounds like you are fighting back against the IBM assault quite aggressively?

This isn't our fight. Janet Perna (IBM's General Manager for Data Management Solutions) announced that IBM were gunning for Oracle. And they came out with a whole host of false pricing comparisons and we are fighting back against that misinformation. We've had enough raps from them, they've really ramped up their marketing and PR efforts and they're spouting FUD, we are just putting the facts on the table.

How noble. What about the Informix acquisition, doesn't that get you a bit nervous?

To be honest, the Informix purchase reeks of desperation to me. IBM might see some of the Informix customer base switch over to DB2, but we'll be taking the rest. All IBM has done is confuse and dilute its development teams by fragmenting the environment.

But surely Microsoft is ramping up the pressure in the NT space? Recent figures showed they had a lead over you - admittedly it was only 0.7%?

Those figures showed a very marginal lead as you note and we can take that back. We are finding that users of SQL Server are very quickly hitting a scalability ceiling that they simply can't pass and, for us, that's low-hanging fruit that we are quite happy to pick. Added to that, our new clustering technology enables people to scale applications across Intel boxes way-beyond the competition giving customer access to massively scalable, low cost technology that they can run on low cost hardware that they are familiar with.

So you've got your results coming out next week, the analyst community seems to expect a rough ride - you've been downgraded by quite a number of them - is it fair to say that your applications and lack of management focus has left Oracle damaged?

Absolutely not. Obviously I can't comment on next weeks results but it's worth bearing in mind that Oracle is a very strong company. Some commentators are saying that Oracle is actually a good buy right now, so you've got to balance that view from the financial community. If you look at the previous quarter Oracle announced a shortfall of 5% but still made improvements on margins. The problem we suffered though is that we are typically the first to announce our results and we suffer for that. The last quarter we were the first company to show the effects of the economic slow down. If analysts had looked back however, after everyone else had done their results, they would have said, 'wow, Oracle only lost 5%.'

What about the state of the applications business, my feeling is that it hasn't been growing anywhere near substantially enough to fend off competition from SAP, PeopleSoft etc.

I think the growth of the applications business is pretty good actually. We've been through stages where we have been turning in growth whilst the competition has been growing negatively. We are making substantial inroads into CRM and companies like Ariba, who you compared us with unfavorably in the past, are in a desperate situation as a whole. Some people are even questioning its viability as a company.

What about Siebel, you are still a long way off them now?

Siebel is bigger than us in that space right now but we are investing a lot of money in our CRM applications and this side of the business is growing.

But there has been criticism over the day to day running of operations and such like. Are you missing Ray Lane and Gary Bloom?

No, simply. I don't understand why people are still talking about this, Ray left over a year ago and the company has not gone out of business, we are still executing well and will continue to do so. The management team that is in place right now is one of the strongest Oracle has ever had.

© IT-Analysis.com. All rights reserved.

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