Oracle’s chairman and chief executive Larry Ellison’s theory works

The new tool promises to redefine what a computer should be: small, inexpensive, and easy to use; offering a cheap alternative to PC’s. An attractive option, Ellison predicts, to companies and the average consumer.

Ellison’s main selling point is the simplicity of the machine. “The PC architecture is much too complicated and expensive for these kinds of devices. We have developed a low- cost architecture for a whole family of low-cost appliances.”

Larry_Elllison_on_stageOracle, founded by Ellison in 1977, is the industry leader of database software and longtime rival of software monopolist Microsoft. The concept of the Network Computer (NC)has been trademarked by Oracle and over 30 companies have endorsed its reference profile, authored by Oracle together with IBM, Sun Microsystems and Netscape. Manufacturing companies like Hitachi, NEC, Toshiba, Olivetti, Wyse, and Fujitsu are set to build various lines of NC-type tools. When they’ll be shipped has not been determined.

What is it?

It’s described as having more raw processing power than today’s PC, and comes with 8M bytes of RAM, 16-bit CD-quality audio, video processing capable of 30 frames per second and a 28.8K-BPS modem. Basically the NC will do everything the PC does: support web browsing, electronic mail, word processing, spreadsheets, graphics and more. The set of appliances (stripped down computers based upon open standards for networked computing and communications) will provide inexpensive Internet access.

Where are the savings?

The NC replaces local disk drives with a network connection, meaning all the data one needs is stored on a server somewhere on the Net. The NC can download most or all necessary software over a network. This will eliminate the costs of software purchases, installation, administration and maintenance. The user won’t have to worry about disk backups or file recoveries. Data encryption technology will ensure privacy and security. No more trips to the store to buy CD-ROM’s or floppy disks, just to buy the NC, which will sell for as little as US$500.

The family of appliances will include:

– Standard desktop NC, designed for use with a keyboard and monitor in the office, or a keyboard and TV in home.
– NC TV, designed for web access, interactive TV, entertainment-on-demand, gaming and electronic commerce.
– NC phone, a screen phone with a key board for accessing electronic mail and services such as on-line yellow pages and travel reservations.

“A corporation can pay $500 to $1,000 for a NC and have no administration cost since if it breaks, you can throw it away and get a new one,” Ellison says. No need for an army of geek doctors; but how many times will it break?

Designed for Everyone

Ellison often refers to statistics in his press conferences. More than 200 million PC’s have been sold to date and research suggests the NC can potentially replace up to 50-70% of the PC market; based on its lower acquisition cost.

Does Ellison believe his concept will sell? Seems like it, but there’s more than dollar signs in his eyes. “The dominance of the PC is temporary; people don’t want to be dependent on Microsoft for alternatives,” Ellison told reporters at a conference in Arizona.

The NC-preacher is targeting all sectors: students, corporations, educational institutions, and families that just want to surf. All in the name of affordability and simplicity. Ellison thinks the NC will also help developing countries with increasing needs for low-cost communications and computing infrastructures.

Nothing but a boob tube?

“Maybe I should fire a few Maverick missiles in his (Gates) living room” That’s all fine and dandy Larry, but what about the cost of a good monitor? TV screens don’t provide quality resolution compared to a good monitor. And what about speed? The Net infrastructure is already clogged; connections are slow. If the NC enjoys popularity, there will be even more traffic in cyberspace. Solutions like ISDN phone lines, cable modems, ADSL, and satellite downlinks won’t be affordable for at least two years. And those using it simply to surf, will need a keyboard if they want to send an e-mail to Aunt Marsha.

If the cash registers ring loudly, the industry’s monopolies will definitely witness some reorganization. Even if the NC isn’t a grand success, Ellison has began a paradigm shift: looking at a computer as an appliance. But failure isn’t in Ellison’s plans. Last month, he announced an aggressive advertising television campaign to be launched in 1997 promoting the NC concept. Good, maybe we can finally see what the thing looks like! One industry expert referred to the product as “vaporware”.

In the meantime, Sony and Phillips Consumer Electronics have put a noncomputer on the shelves selling for US$300. Developed under a covert operation by WebRV Networks, these Web-cruising boxes are the size of a TV cable box. Plug it into a phone line and RV, then use the remote control to dial up to WebTV’s Internet service. A competitor to Oracle? Somewhat, but the NC promises to do more.

Computerless families will certainly be attracted to the cheap surfing appliance, but once they get a taste of it, they’ll want to become part of the digerati, craving more than just an entertainment device. Maybe they’ll want to print out something they read at a site, or blow up a picture. Maybe they’ll want to create their own web site and scan in their family pictures.

That will take a trip or two to the computer store, and to the bank.

As for companies using the NC, who’s going to save their corporate secrets on some server in cyberspace, encrypted or not?

Ellison says the key to the success of the NC is the participation of telephone companies who will host the networks, and is in negotiations with many. As he gears up for the busy marketing year ahead, Ellison, whose company saw revenues of $4.2 billion in the ’96 fiscal year, is enjoying his new T-38 Supersonic jet fighter. “Maybe I should fire a few Maverick missiles in his (Gates) living room.” Nothing personal, right Larry?