Oracle Apes Microsoft Strategy - 15 Jul 2002

Speaking at Oracle's semiannual analyst day, CEO Larry Ellison uttered words many people never thought they'd hear: Oracle will adopt many of the strategies that made arch-enemy Microsoft successful and will focus on inexpensive, integrated software suites. "The suites always win," Ellison said. "The specialty guys can never survive for long." Later this year, Oracle will release a set of products, including the Oracle Collaboration Suite (OCS) that will compete with core Microsoft infrastructure software such as Microsoft Exchange Server.

As usual, the volatile Ellison spent much of his time yesterday good-naturedly poking fun at Microsoft; Ellison's company has long been the number-two software maker behind Microsoft. "Bill [Gates is] a genius," Ellison joked yesterday. "We don't need him working here. We just read what he says: It's cheaper." Ellison said that OCS will integrate with Microsoft Outlook and let users store email, voicemail, documents, and group calendars in an Oracle database. The software will be more secure and less expensive than Microsoft's solutions, he said.

OCS will contain a bit of technology I've been wondering about recently--the Internet File System (IFS) software that Oracle announced more than 2 years ago. As you might recall, IFS was going to enable "no-OS" hardware that would run only on Oracle's database, making Windows unnecessary. And if Microsoft's plans to move SQL Server 2003 (code-named Yukon) into the Windows file system sounds suspiciously similar to IFS, remember that Microsoft has been working on this plan (once called Storage+) for years; indeed, database file systems have been part of the holy grail of computing for decades. In OCS, Oracle customers might finally see the fulfillment of the IFS vision. "It took us a long time to get the pieces together," Ellison said, "so we think we've gone down the road to solve all these problems. It was not easy."

Oracle's desktop play mirrors moves by other server companies such as Sun Microsystems, which recently released a new version of its StarOffice office productivity suite to good reviews. Interestingly, as Oracle and Sun tentatively reach into the desktop market for growth, Microsoft is moving upscale with more scalable server products and services.