The NC rollout is the company's first step toward its goal of moving past its database software roots to become a household name in the consumer market through its Network Computer technology. Oracle's intent to pitch the NC to consumers and schools will put it in direct competition with Microsoft for consumer dollars.
Yesterday, Oracle's NCI subsidiary announced NC in a Box, a $4,995 package that consists of an NC server, two NCs, and software and cabling aimed at schools, governments, and small offices. The company is also embarking on a branding program that will place Oracle's name prominently on consumer-targeted NCs.
Oracle makes its money on the NC server software, not the NCs themselves, which are sold though distributors. But Oracle wants to build consumer awareness of NCs, hoping to spark demand from Internet service providers for NC server software.
Oracle president Ray Lane sat down with East Coast Bureau Chief Mike Ricciuti yesterday in New York to detail his plan to remake Oracle as a consumer-friendly company.
NEWS.COM: Why is Oracle intent on breaking into the consumer market?
Lane: About a year ago, we initiated a program to [determine] Oracle's strategic intent. Can we simplify the dozens of products we sell into a single strategic intent? And the answer was the NCA. And [to sell] the NCA, we have to get the word out in the broadcast medium. We have to position it as a device to enable network computing and as a device for everyone.
We've also transformed the company in four areas. We've transformed from a database vendor to a strategic partner; from a niche focus to broader focus on end users, businesses, and consumers; we've moved from client-server to the NCA; and we've moved from a fragmented organization, with mixed messages, to a single team with a single message, the NCA. It's the first thing out of our mouths now.
That's a brand new message from Oracle. You'll be selling the NC, in part, to a entirely new audience. How do you plan to get the message out?
A lot will come from PR, and a lot from advertising, to broadcast the message around the world. Larry [Ellison's] normal PR stuff has been amazingly effective, by the way. We have not spent a dime on advertising for the NC. It's been Larry's word alone. And you saw the crowd here today. It's simply amazing.
Where will you advertise and when will you start?
We'll start slow, on television, through weekend sports broadcasts. We'll also have Larry doing 15-second spots on the NC. Those will start in September. We'll also have print ads. Those have started already, in [yesterday's] Wall Street Journal. The print ads are also quite different from typical trade ads that talk about transactions per second or other database technology. They're targeted to a wider audience.
Will this new marketing and advertising program also change Oracle's strategic plan? How does Oracle see itself?
Oracle is now two companies. One is a marketer of low-cost transactional infrastructure technology, to lower the cost of network computing. By the way, if we hadn't done the NC, Windows NT would be on every corporate desktop. We've given corporations an option to the Microsoft world. The second business we're in is selling high-value business applications, combining our applications with technology from partners for specific industry applications.
What happens if corporations don't adopt the NC? Won't that be a big
problem for Oracle, since so many development and marketing dollars are
being spent there?
No, it won?t be a big problem. We will continue to be a category leader with our products. We will sell our products one at a time vs. competitors. And we'll essentially disaggregate to selling to target customers.
It must be hard to sell the NC concept to IS without any installed base to use as an example. That's right. But I think corporations will adopt the NC when we have hard numbers to document cost savings that right now are just estimates.
Larry Ellison said today that Sybase and Informix are no longer serious competitors to Oracle. Who is Oracle's primary competitor?
Microsoft is our competition in the first business of supplying technology. And I wouldn't be surprised to see Microsoft buy a [client/server] applications software company, which would make them a prime competitor in the applications space as well.