from briefing.com; This is the first time briefing is actually kind to ORCL, if I'm not mistaken in years.
Oracle (ORCL) 103 1/4 +5 9/16: We wouldn't have guessed as recently as a year ago that we would be calling Oracle (ORCL) the old guard, but in the B2B world, there are the newcomers -- Ariba (ARBA), Commerce One (CMRC), etc -- and the Oracles. The experience thus far in the Internet world is that the new guard beats the old guard -- think of Amazon.com vs Barnes & Noble, or eToys vs Toys R Us, or Yahoo vs NBC/CBS/ABC, even AOL vs Microsoft in the ISP business. The pure Internet plays have beaten the old guard every time. In B2B, the rules are different, and Oracle understands that. The first evidence came with Oracle's deal with Ford (F) to create an online marketplace. Now the Wall Street Journal is reporting that Oracle is working on a similar deal with Boeing (BA) to establish an online marketplace for aircraft parts. Commerce One and Ariba have been seeing success in creating marketplaces as well, but they will not own this business. The lesson here is that B2B is different. If you consider the examples we just noted of Internet pure plays beating old-line tech, media, and retail companies, the target market in each case is the consumer. And in all things consumer, a pure Internet brand name and first-mover advantage have won the day. Not so in B2B. For businesses setting up marketplaces, a trusted name is often more important than an Internet brand. This market is not about searching the Net, or buying books, or making a connection to the Internet. This market is about setting up multi-billion dollar marketplaces that will be an integral part of business operations. Oracle is a trusted name for Global 2000 companies, and Oracle is moving aggressively to translate its strong database brand into a strong B2B marketplace brand. The company has wisely, in our view, focussed on big-name projects such as Ford and Boeing that will quickly establish its credentials as a leading B2B marketplace leader. There are two conclusions to draw -- one is that Oracle's future is bright, as a huge new market potential is now visible. The other is that you cannot value the pure B2B players on the assumption that they will own the B2B market -- they will share it with those in the old guard such as Oracle who aggressively pursue it. - GJ
InSook Prasad |
