Ellison Answers Financial, Technical Questions

By Jim Louderback  |  Posted 2004-01-29 Print this article Print

Q&A: In a wide-ranging discussion at Oracle's Financial Analyst day, CEO Larry Ellison discusses the future of Linux and the strengths of 10g, while getting in a few digs on IBM, Veritas and others.

SAN DIEGO—Wednesday at Oracle AppsWorld here, Larry Ellison was one busy CEO. In between meeting with customers, he managed to fit in an hour-long keynote, a briefing with various groups of the press—including a trade press briefing attended by eWEEK reporter Renee Ferguson—and another long Q&A session with two dozen financial analysts—along with eWEEK.com and a few other general reporters. The session with analysts covered a wide range of topics, from Oracle Corp.s worst mistakes during the go-go 90s to the future of computing, Oracles view on Linux, and how the company plans to compete with Microsoft Corp. and other enterprise software vendors. Ellison, along with Oracles other executives, made a point during the gathering of financial analysts to promote the companys adoption of "Lintel" (Linux and Intel) servers as a low-cost way to deploy large databases. Heres what he had to say about the true "entrance into the information age," brought about by low-cost clusters of servers, organized into a grid.
"Theres been a 40-year quest to build the biggest computer in the world. At Amdahl [where Ellison started his career] we built a faster mainframe than IBM.
"Most applications are designed to run on only one machine. How many IBM DB2 database machines can run SAP? One. Whats the maximum number of SQL Server machines? One. Whats the maximum number of Oracle machines? 128." Ellison went on to describe the performance and cost differences between the current model of enterprise database computing—where you load a database on an expensive SMP box—and Oracles vision of grid computing, an array of cheap Intel servers running Linux and Oracle 10g in parallel. "We found that the sweet spot [for these grid systems] is dual-processor machines, not four. Six-thousand-dollar dual-processor Lintel machines. The $2,500 processor [3.2GHz Pentium] is twice as fast as the $50,000 processor [in large SMP servers]. "Its 40 times the cost/performance of big iron, and the grid of small machines is much faster than the big system. Its real on-demand computing. Sam Palmisano at IBM is having trouble explaining on-demand computing to IBM employees. Id say thats because they dont have on-demand. The technology for them to deliver on-demand computing is a purchase contract. The technology we use for on-demand—plug in another machine—is software. You need more capacity, you add another cheap machine. Its a fundamental change in the computing business. "We support companies that make very fast, low-cost, small machines. We think Lintel is very attractive. I talk with [Sun Microsystems Inc. CEO] Scott McNealy all the time, hes a good friend, and Sun is on board with this. I think they will be the first to deliver very fast AMD [Advanced Micro Devices Inc.] machines running Linux. They will miss the 32-bit Linux show, but they want to be first with 64 bits. I think they will be the first to deliver 64-bit Linux. "We think this has implications not just for the database business, but for the entire industry." As for Linux, Ellison doesnt see Red Hat Inc. turning into the next Microsoft and taking over the industry, but he does see the open-source operating system beating Windows in the data center. "I think its impossible for there to be another Microsoft. Lets say Red Hat decided to increase the cost of Linux by a factor of 10. IBM and Oracle would have their own distributions of Linux the next day. Wed cut them off. They just cant do that. "Or wed quickly switch customers to SuSE. The Linux intellectual property doesnt belong to Red Hat. Further, Red Hat doesnt service many customers. Red Hat relies on us to service Linux for them. Why do our [enterprise] customers buy Linux? Well, they arent willing to rely on Red Hat to fix the system if it goes down. They are willing to rely on us. We take full responsibility for those systems. I dont think anyones going to trust Red Hat for that. So how many Linux distributions do we need? "I think one Linux version controlled by one company wouldnt be good. One hundred wouldnt be good either. Whats the optimal number? Twos the absolute minimum, but three or four isnt bad. We fully support that. "We think a lot of people misunderstand Linux. Everyone focuses on open source and free. Well, theres some open-source and free stuff thats not very good. When the topic turned to Linux versus Windows, Ellison was outspoken in defense of Linux in the enterprise. "Linux is a much better data center operating system than Windows. The Windows design point is for having one Windows machine in every hamburger store and every bank branch. Its a distributed model. Linux works better when you have 500 machines in one data center. Its a better product than Windows, like Apache is a better product than IIS. We saw Apache wipe Microsoft out of that market entirely, and I think Linux is going to win the server wars. There are even people at Microsoft who think that it is inevitable." Next page: Making the transition to 10g

With more than 20 years experience in consulting, technology, computers and media, Jim Louderback has pioneered many significant new innovations.

While building computer systems for Fortune 100 companies in the '80s, Jim developed innovative client-server computing models, implementing some of the first successful LAN-based client-server systems. He also created a highly successful iterative development methodology uniquely suited to this new systems architecture.

As Lab Director at PC Week, Jim developed and refined the product review as an essential news story. He expanded the lab to California, and created significant competitive advantage for the leading IT weekly.

When he became editor-in-chief of Windows Sources in 1995, he inherited a magazine teetering on the brink of failure. In six short months, he turned the publication into a money-maker, by refocusing it entirely on the new Windows 95. Newsstand sales tripled, and his magazine won industry awards for excellence of design and content.

In 1997, Jim launched TechTV's content, creating and nurturing a highly successful mix of help, product information, news and entertainment. He appeared in numerous segments on the network, and hosted the enormously popular Fresh Gear show for three years.

In 1999, he developed the 'Best of CES' awards program in partnership with CEA, the parent company of the CES trade show. This innovative program, where new products were judged directly on the trade show floor, was a resounding success, and continues today.

In 2000, Jim began developing, a daily, live, 8 hour TechTV news program called TechLive. Called 'the CNBC of Technology,' TechLive delivered a daily day-long dose of market news, product information, technology reporting and CEO interviews. After its highly successful launch in April of 2001, Jim managed the entire organization, along with setting editorial direction for the balance of TechTV.

In the summer or 2002, Jim joined Ziff Davis Media to be Editor-In-Chief and Vice President of Media Properties, including ExtremeTech.com, Microsoft Watch, and the websites for PC Magazine, eWeek and ZDM's gaming publications.


Submit a Comment

Loading Comments...
Manage your Newsletters: Login   Register My Newsletters

Rocket Fuel