Ellison To Let Up On NCs
(01/09/98; 9:42 a.m. EST)
By Shawn Willett, Computer Reseller News
Oracle chairman Larry Ellison has been a tireless crusader for the
network computer, using every public event he appears at to
hawk the new devices.
Now, however, according to sources close to the company, the
mercurial CEO plans to de-emphasize the NC and focus his
efforts on selling Oracle's bread and butter databases and
applications.
Oracle's recent earnings "disappointment" are the main reason
for Ellison's change in tactics.
But industry observers say the slowdown in database sales may
be too deep-rooted for even Ellison to turn around.
Oracle reported an anemic 3 percent increase in database sales
for the quarter ending in November, and the quarter before that,
the company's database sales grew by just 6 percent.
Oracle is not alone. Sybase, the second-largest open systems
database vendor said it would be reporting a decline in its
revenues for the quarter ending in December, and analysts said
they do not expect much growth from financially troubled Informix
Software in the near future.
through a slow period," said Mitchell Kertzman, chairman of
Emeryville, Calif.-based Sybase. He blamed year 2000 issues
and new technology.
"I think customers are taking a pause, and it's hard to predict
when that lifts," Kertzman said.
But others said overselling of site licenses and "maintenance
contracts" from Oracle is also to blame for that database
slowdown, especially in the Oracle market.
Under Oracle's maintenance contracts, customers buy a
subscription for two or more years, and all upgrades are free. This
limits the revenue generating capability of a new database
version such as Oracle8.
According to VARs, overaggressive Oracle salespeople have
sold so many site licenses that some companies are, in effect,
stocked up for years on Oracle seats.
"The good news is nobody will displace Oracle in those accounts,
they've already bought their database," said Karl Wilhelm, vice
president at SRA, a Vienna, Va.-based integrator. "Nobody
makes much on selling database licenses anyway." |
