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August 25, 1998


By CBR Staff Writer

The long-anticipated launch of Oracle Corp’s Application Server 4.0 finally went ahead on Tuesday. AS4 boasts support for Enterprise Java Beans, CORBA, Object and Java Transaction Services, HTTP and IIOP but, weirdly enough, not for COM, CORBA components, XML or public key infrastructure – or at least, not yet. AS4 enters a converging market, and one that is becoming increasingly crowded with players from the client/server tools community (Inprise, Wall Data), the middleware business (BEA, Iona) and the web world (Bluestone, Gemstone, WebLogic, Silverstream and Allaire). More recently, both Sun Microsystems Inc and Netscape Communications Corp have bought into the web application server space, with Sun’s acquisition of NetDynamics and Netscape’s Kiva buy. Against this host of competitors, Oracle’s big selling point is that its Application Server is the most complete offering so far. The company goes so far as to claim that AS4 is the first integrated enterprise application server, which is a little unfair to IBM’s high-end middleware solutions or, indeed, its venerable CICS. But the point is not especially to threaten IBM, which seems to be selling its enterprise software into existing all-IBM shops. Rather, Oracle has chosen a far more predictable target. With CEO Larry Ellison publicly backing away from the network computing architecture (NCA) – a mistake, he now says, we should have just called it internet computing – AS4 is being primed to continue the battle against Microsoft under another name. How? By making it possible to rent applications and outsource business logic. The reasoning goes something like this: These days Ellison also disowns client/server computing, another model his own company helped promote. I think it was Steve Ballmer who said that watching mainframes die is like watching glaciers melt, he joked, the interesting question is: Why aren’t the mainframes going away? And the answer is that people haven’t been able to deal with the complexity of client/server. As the press gasped audibly, Ellison explained that the problem of managing, upgrading and backing up two- and three-tier distributed applications had proved intractable. We long for the days of mainframes, he said, in a sense this whole movement to the internet is a little bit back to the future. The key to his argument is that the internet can deliver the reliability, scalability and uptime that mainframes once ensured, and that client/server never quite managed. At the same time, it can centralize administration and slash labor costs and bandwidth traffic. Instead of having local servers at every site where there are clients, as in the Microsoft NT model, Ellison wants to see one or two very large-capacity application servers and databases serving thousands of remote sites. In this model, only the user interface – what you actually see inside the browser – goes over the WAN link, improving network performance many times over. Naturally those large-capacity servers would have to be running Oracle servers, since the equivalent products from Microsoft (IIS, SQL Server) don’t scale up that far. When it comes to the heavy lifting, Ellison avers, even Microsoft has to admit that Oracle does it better. He pointed out that both MSN and Web TV use Oracle databases, rather than Microsoft’s equivalents. Ellison also wants those big servers to be running Oracle applications. He’ll happily sell you your accounts receivable and HR software and what’s more, he’ll host those applications for you on his own computers. After all, he reasons, big corporations now routinely outsource finance and HR. Why not small businesses? Why not doctors’ surgeries and law practices? He envisions a host of internet sites supporting vertical industry applications for every imaginable market segment. The application servers can be professionally run, the independent software vendors mop up the lease payments and the doctors go back to what they do best – old-fashioned

doctoring. It’s just whacko to put all those mini-mainframes into a doctor’s surgery, he concludes. Better to lock them safely away in a server farm. Whacko for the doctor maybe; but for Microsoft itself, crazy like a fox. While Oracle is shifting a couple of servers and a few thousand software leases per site, expect NT unit shipments to keep growing. Could this be why Microsoft is still the world’s biggest software company, with Oracle in second place?

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