Oracle takes lid off grid plan

Grids are the big theme at the OpenWorld customer conference in San Francisco, which got under way Monday. Oracle executives have called grid computing the most significant new business technology to come along since the Internet, and they say Oracle is making its most innovative technology leap in a decade with a host of new database and related software products it's readying around the grid concept.

"This OpenWorld is a milestone event for us and the industry, as we usher in an era of grid computing for the enterprise," Chuck Phillips, executive vice president of Oracle, said Monday before an audience of thousands at the conference. He added that his boss, Chief Executive Larry Ellison, will officially launch the company's grid computing initiative Tuesday in a keynote address at the confab.

Oracle will release its new grid computing product line, called 10G, around the end of the year, Phillips said. Hundreds of customers are already testing the beta version of the products.

The appeal of grid computing, according to Oracle, IBM and others, is that it could save companies money by making their data centers less expensive to run. Today, computers spend much of their time sitting idle, as processors wait for data to crunch from a particular business application such as a credit card processing system.

In a grid world, the idle time of hundreds of servers and databases could be pooled and allocated at different times for separate applications, dynamically adjusting to whichever system demanded the most processing power at the time. So a retailer's payment processing system would absorb more grid power the day after Thanksgiving, for instance, than at other times of the year. The end result is that companies could meet their computing needs with fewer machines and fewer people dedicated to running them.

Some people are less enthusiastic about the new technology and claim it's yet another example of the computer industry succumbing to hype.

"Grid computing reminds me of hydrogen-powered cars--a neat thought, but still years away from practical reality," Jon Oltsik, a founder and principal at Hype-Free Consulting, wrote in an April 29 column for CNET News.com.

Oltsik argued that even the most advanced systems from Oracle and others today, such as server "clusters," consist of only a couple machines and are designed more for emergency computing than for collective computing. It will take "a boatload of cash and a roomful of technology Ph.D.s," to deliver on the promises of grid computing, he wrote.

Oracle's Phillips acknowledged the hype around grid computing, which so far has been used mostly in science and academia. He underscored Oracle's belief that the time is "ripe" for the concept to take hold among businesses because of the advent of low-cost computers such as the so-called blade servers from Dell, Hewlett-Packard, IBM and Sun Microsystems that generally cost less than $2,000 a box. These smaller, cheaper computers and the Linux operating system have laid the foundation for grid computing, Phillips said.

One advantage of grid computing, Phillips added, is that companies can adopt the technology at their own pace by gradually replacing big, expensive servers that act as "islands of computation" with cheaper computers that share processing power over the grid. He also said software developers and business applications companies like SAP "don't have to make any changes to that application to take advantage of the grid."

Yet some technology experts argue that it'll be some time before business transaction-intensive software packages such as those from SAP can be made to run over a grid architecture. "It won't work for enterprise resource planning or payroll," Jonathan Schwartz, executive vice president of software at Sun Microsystems, said in a recent interview. "Oracle is trying to evolve a new marketplace, and it will happen. But it won't replace everything else."

The company doesn't plan to discuss the price or a more specific general release date for its new line of 10G database, application server and systems management software this week, Phillips said.

Although Oracle paints itself as a grid computing pioneer, others say the company is reacting to the moves of competitors. "They are positioning themselves on the technology side as a legitimate competitor to IBM and, to a lesser extent, Microsoft," said Joshua Greenbaum, an information technology analyst at Enterprise Applications Consulting. "The focus of this Oracle event is to further the contention that Oracle can take on IBM and its 'on demand' message in face-to-face competition."

IBM, Microsoft and Oracle, the world's three biggest suppliers of database software, have been duking it out for the top spot in the $12 billion database market. Grid computing appears to have become the latest front in that fight, as database buyers demand technology that's cheaper, more reliable and easier to manage. Performance--the ability to manage large loads of data without crashing--is becoming less of a differentiator, analysts say. Yet Oracle has always touted performance as the most distinguishing feature of its products.

Phillips called Oracle's grid push, "a key milestone in the battle with IBM."

Another topic that's sure to pop up at OpenWorld is Oracle's ongoing bid to acquire business applications competitor PeopleSoft. With PeopleSoft Chief Craig Conway recently calling the Oracle buyout saga "over," Oracle's Ellison is unlikely to remain silent on the issue. The CEO is scheduled to deliver a keynote speech Tuesday.

Last week, Oracle extended its tender offer period for PeopleSoft shareholders to Oct. 17, the fourth time it's pushed the date forward since launching the unfriendly bid in June. But with PeopleSoft's shares closing Friday just nickels below Oracle's $19.50-per-share offer, Oracle may again need to sweeten the deal.

"Cleary, the market is saying $19.50 isn't going to do it," Greenbaum said. "But Ellison is fully capable of pulling that rabbit out of his hat."