Oracle has fleshed out plans to lease its enterprise applications via the Internet to small and medium-sized businesses in a scheme reminiscent of the old mainframe service bureaus.
The first package to be available for rental under the so called Oracle Business Online initiative (see Newswire, 11 June 1998) will be manufacturing, but the entire Oracle Applications family is expected to follow suit. These will include human resources, payroll and general ledger. The service will be based on version 11 of the packages, which include a browser at the front-end.
Larry Ellison, Oracle?s chairman, explained: "This will provide a much easier way for small and medium-sized businesses to access applications. It means they don?t need to buy or install a computer on site, but can log onto our Web site and we?ll do it for them. I actually think we?ll make more money this way. We?ll charge customers for a software licence and for usage, but it will be cheaper for them due to economies of scale and more profitable for us."
However, he added that Oracle had not taken its own medicine and outsourced its own non-core business operations, despite evaluation work undertaken by Ray Lane, Oracle?s president last year in an attempt to make the company lean and mean enough to compete in the emerging Internet-based economy (see Newswire, 10 April 1997).
Lane said at the time he was considering whether to outsource European IT, voice and data networks, purchasing, logistics and product distribution. In the end, Ellison confirmed that only human resources had been transferred to Fidelity because "I think it?s very important for us to eat our own dog food. We need to use our own software so we can get more feedback on it."
As previously reported, the Business Online service is being trialled by several Internet Service Providers such as US West Communications, which plans to offer it to its own nine million strong customer base.
But, according to Ellison, customers will also be able to log onto the Oracle Web site, subscribe or use ID to access the service and then either input the relevant data via a browser or pass it over to Oracle to be scanned in.
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