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Oracle ready for e-commerce

The database software giant will ship its long-awaited e-commerce server next week.

Oracle (ORCL) will ship its long-awaited Internet commerce software for selling consumer goods online next week.

Originally called Project Apollo, Oracle Internet Commerce Server 1.0 is designed for companies setting up their own Web storefronts. Oracle said the next version will let ISPs and Internet malls host multiple stores.

Analysts suggest that it's a good first try for companies already running Oracle databases and applications. The system does not run other companies' database software.

"Being Oracle makes it a strong offering, but it's not completely mature," said Chris Stevens, an analyst at Aberdeen Group. "It's especially for Oracle-centric shops that don't mind if it's just based on Oracle databases. It's not designed to run on databases of multiple vendors."

Others see the e-commerce server as a strong competitor to established players, despite its Oracle-only limitations. "It's going to be a great competitor to commerce servers from Netscape Communications, Microsoft, Connect, and maybe Open Market," said Erica Rugullies, an industry analyst at Giga Information Group.

"I suspect it will be very strong technology. Microsoft has had kind of a bad rap for its technology. Oracle will come to market with something good," she added.

Although Oracle insists that Internet Commerce Server isn't just for current Oracle customers, analysts think it will find the most success with them.

"For shops that have Oracle financial applications or applications that rely on Oracle databases, it's worthy of evaluation," Stevens said. "But with Oracle's size and its professional services group with the ability to integrate commerce software with other applications, they do have an enterprise story, not just an installed-base story."

Oracle is targeting online commerce as part of an effort to provide added value to its database customers in what's increasingly becoming a commodity business. Oracle, and other database makers, are branching out into specialty technology, such as Web servers, middleware, and e-commerce software, to counterbalance what analysts expect will be a gradual slowing of database server sales over the next few years.

Oracle is also counting on its services business to contribute a larger share of revenue to the company's bottom line.

However, Oracle is introducing the server in a turbulent market for e-commerce software. Actra Business Systems, the joint venture of Netscape and GE Information Systems, unveils its long-awaited e-commerce offerings Monday.

Early this month, Microsoft said a new, cheaper version of its merchant software will ship this fall with new business-to-business features, tacitly giving up on the version it's now shipping. This week, BroadVision shipped its One-to-One Commerce application for personalizing Web storefronts, bundled with consulting services for $125,000 and up. BroadVision promises an electronic storefront will be up and running in 30 days.

Oracle is clearly focused on IBM as its chief rival.

"Microsoft and IBM are the only two that can be platform players, and only IBM can throw in the expertise and consulting that Oracle offers," said Randy Hodge, Oracle principal product manager. Aberdeen's Stevens mentioned start-up InterWorld Technology as "a play that's database-agnostic."

"Oracle is kind of late to market, and that could hinder sales," said Nicole Vanderbilt, e-commerce analyst with Jupiter Communications, noting that Microsoft and IBM have announced second-generation products.

In beta testing since January, Internet Commerce Server 1.0 will be priced at $20,000 per processor and includes the enterprise edition of the Oracle 7 database software and the advanced edition of Web Application Server 3.0. In the fall, Oracle will offer a $5,000 version of the commerce software for existing Oracle customers.

Initially, Oracle will offer separate e-commerce software for marketing to consumers and to businesses, where it has both Web Customers and Web Suppliers software. But the two products will be melded into a single commerce platform once the business-to-business offerings are rewritten in Java, as is the Internet Commerce Server.

ICS includes customizable templates for creating catalog pages, order processing, and open interfaces for handing transactions off to back-end systems. It's available on the Solaris Unix operating system this month, with versions for Windows NT and other versions of Unix due next month.

Unlike competing e-commerce software firms, Oracle has relatively few independent partners supporting its offering, something that Aberdeen's Stevens concedes is a shortcoming.

"Part of the challenge here is to develop those partners," the analyst said. Plug-in cartridges for Oracle's software include VeriFone and CyberCash for payments, TaxWare for tax calculation, TanData for shipping and handling, and Portland Software's secure packaging for delivering software online.