Oracle invests in its vision of social networks

Oracle's unexpected move into the hardware business, with the launch of storage and database products, has intrigued industry observers, writes Karlin Lillington in San Francisco

SOCIAL NETWORKING and a venture into hardware were the newcomers to Oracle's ever-increasing products universe last week at the company's annual OpenWorld conference in San Francisco.

Most surprising was Oracle's unexpected move into the hardware business with the launch of two products, a storage server called Exadata, and a new ultra high speed "database machine".

Both are produced in conjunction with HP, whose chief executive Mark Hurd appeared onstage with Oracle chief executive Larry Ellison by video link to promote the joint venture.

Ellison said during his keynote address that the Exadata storage server would offer better performance speeds than traditional storage servers because it sifts data before transferring it over to a database server.

Ellison also launched the Oracle Database Machine - a grid, or multiple computer package of Exadata and database servers contained in a large rack - which he said was "the world's fastest database machine".

The two products bring the software company directly into the data warehousing market, and places Oracle in competition with hardware makers such as Sun Microsystems, EMC and IBM.

Some analysts felt the products would address a gap in the market for hardware that can more efficiently run database software. But others felt Oracle was coming late to a market full of formidable competition from some of the most powerful hardware companies.

On the application front, the company's major launch was Beehive, a collaboration software suite that utilises and manages many of the trendier social networking ("Web 2.0") technologies, such as wikis, forums, and online messaging.

Beehive, which incorporates some of Oracle's earlier collaboration products, was either new window-dressing for so-so products from Oracle's past, or a total overhaul that will bring Web 2.0 into the corporate world, depending on who one listened to.

"One of the things that we heard back from our customers was that, while all these [Web 2.0 technologies] exist, there's no integration for those products," said Chuck Rozwat, executive vice-president of Oracle server technologies. "Integration is one of the things we thought we could bring to the market to make it a lot easier for end users and whole lot easier for administrators."

Analyst firm Gartner remained unimpressed, however: "After two unsuccessful forays into the collaborative market, Oracle is back . . . Gartner believes Beehive is unlikely to be any more successful than previous efforts."

Mark Brown, senior director of collaboration business strategy at Oracle, countered that "Beehive is a new product, not an e-mail platform that's 10-15 years old . . .It isn't an upgrade to Oracle Collaboration Suite 10." Collaboration and security are the product's hallmarks, he stressed.

Europe and the entire EMEA (Europe, Middle East and Africa) market continues to be very strong for Oracle, said Sergio Giacoletto, Oracle's executive vice-president, EMEA. He said that EMEA experienced 34 per cent revenue growth, to $7.9 billion, in the financial year 2008, with 5.7 per cent growth in its database market and 14.4 per cent growth in middleware, according to figures from Gartner.

While the company had seen a 23 per cent drop in EMEA applications sales in the first quarter of the 2009 financial year, Giacoletto insisted this was just a quarterly variation and "no particular issue".

He noted that the company was seeing growth in EMEA in its two new business units, taxation and insurance, "especially in emerging markets". The company's strongest growth is in Russia, Turkey and the Middle East, he said, but noted that in the first quarter, it had been Germany. Growth "may vary from quarter to quarter, but in general, in the Middle East and Africa growth is faster than in western Europe."

Nonetheless, he said that Oracle's push for open standards in some areas of its product line was "important" in Europe, where the European Commission and many individual national governments support open standards and free and open source software projects.

Giacolletto said Oracle's broad product and services portfolio put it in a good position to weather any downturn, and added the company had little presence in the troubled banking sector.

In one of the event's guest keynotes, Intel chief executive Paul Otellini had his own message for the financial world. He said that, hypothetically, if a trader on the New York Stock Exchange had been running a system with Intel's latest, much faster Dunnington processor, it could have saved the trader $33 million in a critical five-minute window on September 15th, when the Dow Jones industrial average plummeted 218 points.

Too bad the processor was only introduced in the last two weeks.

The buzz on 'Beehive': customers interested

WHILE MANY analysts initially questioned Oracle's large-scale acquisition strategy, customers seem to be generally happy with the breadth of offerings, with some finding they already used the same products when they weren't under Oracle's roof, anyway.

Take Jonathan Ebsworth, a vice president at consultancy CapGemini in Britain, who advises on information technology for large enterprise customers.

"What we've got now from Oracle is a very clear product strategy with a very rich feature selection," he says.

He's "excited about the hybrid Oracle technologies and the applications" now coming from the company.

"I see Oracle as having best-of-breed middleware [software that connects different programs together] and a huge amount of [application] content" that can be used in services-oriented architecture (SOA), ways of connecting applications to address specific business functions and institutional processes.

For his central government clients, Ebsworth feels the service-enabled applications "should allow us to define solutions more quickly".

However, he would like to see "something more compelling in terms of the interconnection between data".

In particular, he'd like "things to talk to things".

As for the new Web 2.0, social networking software emerging from Oracle, such as the new "Beehive" application launched at OpenWorld, Alex de Vergori, database architect with UK online betting site Betfair, is very interested, but also more cautious.

"I think it [Beehive] is a great idea - but it remains to be seen how it works," he says.

He notes that Betfair incorporates instant messaging, forums, wikis and other social networking technologies already, and believes these are a key element in generating customer betting activity.

"We use all those and it would be nice to use it [to tie them together]."

Ebsworth is a little more reserved. While CapGemini is quite interested in using such technologies internally, among clients they "are on the corporate agenda, but a lot of organisations are seeing that as aspirational rather than something you do right now."

He adds: "It's a journey we're all pretty much at the start of, rather than well down the track."

Source: www.irishtimes.com

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