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Oracle predicts the future
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October 9, 1998: 6:01 p.m. ET
… and Windows will be obsolete, if the company's new strategy pays off
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NEW YORK (CNNfn) - Just about everyone has an idea of what the future of computing will bring, but only a few of those ideas actually take hold.
Remember the Network Computer? That was Oracle Corp. Chairman Larry Ellison's idea of the future of computing.
Instead of machines stuffed with memory and disk space that people didn't need to run software programs bloated with features people didn't want, the Network Computer (NC) would come without a hard drive, with limited memory and would run applications centrally stored on a server.
The goal was to simplify computing, lower costs and increase efficiency. Oh, and to make a little company called Microsoft Corp. obsolete, since NCs would run applications written in Sun Microsystems Inc.'s Java programming language.
But the NC's life was over before it started, in part because PCs have become nearly as cheap as the $500 NC.
Meanwhile, Microsoft's Windows operating system continues to dominate the computing world. But the Redmond, Wash. software behemoth is also one of Oracle's biggest competitors in a market Oracle has dominated: creating database-management software for large corporate enterprises.
Oracle is still the king of this market. Indeed, just last month the company handily beat Wall Street's fourth-quarter estimates.
But Microsoft (MSFT) is gaining on Oracle's heels. Also, though the corporate-database business is lucrative, the products are not the type that companies tend to upgrade often. So when Microsoft cuts into its business, it's potentially taken a customer away for several years.
That, and the effect of the Asian economic crisis, has contributed to Oracle's (ORCL) bumpy stock ride this year.
(Click here to see a chart of Oracle's year-to-date stock activity)
Ellison, one of the more savvy -- if iconoclastic -- technology leaders, realized Oracle's future could not be just making corporate-database products.
"Our vision is this: In the future, companies won't buy computers. They'll buy connectivity to the Internet the way you go to the electric company to get electricity," said Mark Jarvis, Oracle senior vice president, worldwide marketing.
So how does the company plan to cash in on this vision? Enter Oracle 8i.
The "I" word
The "i" in Oracle 8i, of course, stands for Internet. The Java-based product is designed to manage Internet applications across corporate and public networks.
But it's also Oracle's latest attempt to knock Microsoft off its Windows pedestal. Indeed, Oracle has dubbed 8i the "Internet computing platform."
That's because Oracle 8i comes with what's called an Internet file system (IFS). Basically, IFS allows users to store any file in any format in the database.
Authorized users can then search and view files from any computer with any Web browser. Oracle calls this approach "store once, use anywhere," invoking Sun's "write once, run anywhere" slogan for Java.
What's really important from Oracle's standpoint is that with IFS, Oracle 8i is as much an operating system as it is a database.
Ellison himself has been quoted as saying Oracle 8i is designed to compete against Windows NT rather than Microsoft's SQL Server 7, a database upgrade due to ship later this year.
"Oracle 8i is designed to be an Internet operating system," Jarvis said.
Oracle believes the Web will control the computing world within the two years. Ellison pointed out at this week's Internet World conference in New York, all the major Web sites use Oracle databases.
Now, with an Internet-ready database in Oracle 8i, the company believes it is primed to offer the operating system for the next age of computing.
"As the Web becomes the most important way of computing, going forward, Windows will fall by the wayside," Jarvis said. "By the year 2002, there will be 2 billion devices connected to the Internet and only 10 percent of them will be running Windows."
That may be the case, but how this will turn into profits for Oracle is another issue.
All about the Internet
Oracle wants everyone to know that the days of client-server computing are numbered. Forget about buying Windows-based software and loading it on to a PC or a network server.
At Internet World, Ellison said businesses will soon run their applications directly from the Web -- applications that will run on any device that runs a Web browser.
"Every corporate network will become a corporate Internet," Ellison declared.
And if every corporation makes the Internet their corporate network -- accessing all the software they need through the Web -- then Windows will be obsolete and Oracle 8i will be running those networks.
Of course, Oracle already has a running start. Ellison pointed out that "every large Web site that uses a database uses Oracle -- even Microsoft's Web TV."
"As the paradigm shifts from Windows to the Web, we will have the dominant server technology," Jarvis said. "(Microsoft) SQL Server is not Internet enabled. Oracle 8i is." 
-- by staff writer John Frederick Moore
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