The Future of Information Technology at Vortext 2004

Interview with Charles Phillips:
The Future of Information Technology at Vortext 2004
Charles Phillips was interviewed about the future of IT by author Geoffrey Moore at Vortext 2004, a summit of top executives that was held October 5, 2004. Charles answered a number of questions about the future and Oracle’s vision.

Q: What about MySQL? Is it a threat to Oracle’s database business?
Charles Phillips: It’s a commercial version of open-source database software. If we’re all in the transportation industry, then Oracle is the 747 and MySQL is the car that gets you to the airport. There are 125 open source databases in the market. That’s good. Oracle customers move from MySQL to Oracle when they are ready for more robust software.


Q: What about Microsoft?
CP: They are a real competitor but our task is to focus on providing the Oracle databases on Windows at the right price point.

Q: Turning to SOAs (service-oriented architectures). What of the concept of modularizing layers? Is the database going to be different?
CP: We have been evolving the Oracle database, and certain discrete functions have become modules. But developing an SOA architecture has not been the purpose. We view SOA differently. We’ve done focus groups and spent time with customers to see how they look at it. They see it as an extension to their current infrastructure. We’re not going to extremes like our competitors.

Q: So what is your view of the stack?
CP: Well, first of all, we called it a “stack” way before anyone else did, and we have the advantage of engineering our software to work together as a stack. The advantage is engineering common services that work together across the layers, e.g., security, systems management, etc. To oversee our “stack” development, we have a CTO function. He and his team meet each Monday to review the common services needs and to ensure everything is leveraged and working seamlessly. It results in more predictable, higher quality software. We have 12 different features that have been optimized for the stack.

Q: What about the Application Server layer? This is where BEA, websphere, Sun and SAP are playing. Does Oracle’s Application Server not have market share or is that a misperception?
CP: We are No. 1 on UNIX and the fastest growing application server in the market for several years running. According to industry analysts, we have 19% share; BEA is not that far ahead. We have 13,000 applications customer using our application server. (Note: As of Oracle’s first quarter in fiscal year 2005, Oracle had 22,620 customers, a large majority of whom are running Oracle Applications as well as Oracle Application Server, as Charles emphasizes in his answer.)

Q: What about independent companies using your application server?
CP: Our application server can be used by anyone, but the advantages of the shared services I spoke about won’t be there. So for example, pooling and automatic failover to our database isn’t available because those are common services that have been engineered between our database and application server.


Q: What about when SAP works with you?
CP: Yes, customers use SAP, Netweaver and the Oracle database. But SAP doesn’t optimize for our database. They use it as a file server. Because we have the full stack, we can make smart decisions about where functions exist.

Q: Is there no longer room for third party ISVs?
CP: ISVs will have to make different decisions. They will need to pick a stack and focus on areas that they do well.

Q: What about the collaboration market?
CP: ISVs can embed our functionality within their applications. Some ISVs already do that ? they leverage what we call the Oracle information architecture. Our collaboration suite is excellent for helping companies with compliance issues by the way. Customers have traded out 200 exchange servers for one Oracle instance to help with compliance.

Q: Mike Volpe (SVP & General Manager, Cisco Systems) earlier said that more and more communications is based on non-structured data. Is that still considered a transaction? How does Oracle view this area?
CP: We are seeing more and more data that is non-relational. We haven’t met a data type that we couldn’t handle. Our vision is that the database becomes a file system. Microsoft shares that vision. One of the key advantages of putting this information in a database is the search capability. For example, if CIOs need find files, they will be able to conduct a search. All information in all kinds of forms is searchable and comes up. The format doesn’t matter. And, you can easily migrate content to a database ? files are easily saved into the database using an easy-to-use interface.

Q: When you talk to CIOs, what are the common conversations on architecture?
CP: We hear, “Don’t rush me onto an SOA architecture. We need a standard architecture and integration on standards.” We also are asked “Does Grid work?” We get a lot of questions about the benefits of grid on Intel vs. continuing to buy big SMPs.

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