Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Guidance and Visibility -- Ignore unavailable to you. Want to Upgrade?

To: ChrisJP who wrote (58844)	6/27/2002 7:41:29 AM
From: Jeff Jordan	Read Replies (1) \| Respond to of 208838

The chief of the world's No. 2 software company said the market had reached the bottom and prospects for Oracle were very good but many, smaller competitors would succumb. The way out of a gloomy market for enterprise software is to grab business from your smaller, troubled rivals, Larry Ellison, CEO of Oracle Corp. "Why Oracle's future is so good is because of a concentration of spending on the few surviving suppliers: Microsoft, Oracle, SAP and IBM,'' Ellison told reporters on the sidelines of an Oracle conference here. "It will be killing fields. We will grow and prosper. Customers will have fewer choices,'' he said. Smaller and larger rivals he sees disappearing are online market places software company Ariba, application server maker BEA Systems and Siebel. Oracle still is feeling the heat of the downturn. Last week it reported a 23 percent drop in fourth-quarter earnings on 12 percent lower revenues, but still better than market forecasts. Key sales of new software licenses, a driver of future growth, fell 29 percent from a year ago. Ellison insisted his company is in better shape than others and can grow just by winning business from rivals. "We don't need a recovery in tech spend to grow,'' he said. "If the spending that was spread across hundreds of small companies [a couple of years ago] concentrates on three or four, the survivors will do extremely well,'' he said. Assuming modest recovery in corporate spending, Ellison projected modest top line growth but much faster profit growth this fiscal 2003. The current fiscal year will compare with a very slow 2002. IBM and Microsoft are turning up the heat in Oracle's key database market, which contributed about 80 percent of revenue in fiscal 2002. But Oracle is striking back with what Ellison said are cheaper, better and more reliable products based on application clustering. The idea of clustering is to take a group of small Linux machines together, that will allow low cost machines to run large enterprise applications, he said. "Oracle [is] the only one with these clusters and the reason why we don't need a recovery in IT spending to grow,'' he said. "This should allow us to take market share from IBM and Microsoft in the database business,'' Ellison added. Ellison dismissed the theory that the database market is mature. "We see tremendous growth in database business, we are just in a recession.''