Oracle's Application Server: Captive Audience

By Baselinemag  |  Posted 2004-05-14 Email Print this article Print

Oracle customers say they've been won over by the company's lowball pricing, though some balk at its hard-sell tactics.

In the late 1990s, Oracle executives realized the company was leaving millions of dollars on the table as customers hooked up BEA or IBM application servers to Oracle databases. Since then, Oracle has bulldozed its way to the No. 3 spot in the application server market.

How does Oracle's me-too offering stack up? It's a bit hard to say, since most buyers are existing Oracle shops that don't weigh alternatives. Case in point: Burlington Coat Factory, which has been a "committed Oracle shop" since the late 1980s, implemented the vendor's Application Server as part of keeping current with its offerings, says CIO Mike Prince. "It may be the tail wagging the dog with us, as far as the reason we use their application server," he says.

In fact, Oracle doesn't see head-to-head comparison in the majority of its deals for Application Server, says Vijay Tella, chief strategy officer in Oracle's Application Server group. "These customers have an Oracle database, and they see the advantage of the application server's integration with it."

However, customers do evaluate the product on its merits—and they say it has greatly improved after a rocky debut, particularly after the company junked its own Web server and adopted the open-source Apache code with version 9i of the product in 2000. "It's been very, very stable since they moved to Apache," says Rizwan Ahmed, CIO of Louisiana's Department of Natural Resources. The agency installed Oracle's previous Application Server in 1998, at which point the product "was not mature; it had quirks in it," Ahmed says.

Others are won over by Oracle's lowball pricing, which can be well under its rivals'. "BEA's starting price was $250,000," says Mary Fonder, CIO of metal-enclosure manufacturer Maysteel. "We couldn't afford that." She selected Oracle, whose offer was less than one-tenth what BEA bid.

But some have balked at Oracle's hard-sell tactics. "Oracle was really aggressive, to the point where we considered that there was something wrong with the product," says Brian Chau, director of e-business at USF. While the shipping company has several Oracle databases, it picked BEA's application server to power its customer-facing Web site.

500 Oracle Parkway
Redwood Shores, CA 94065
(650) 506-7000

Employees: 40,650

Charles Rozwat
Executive VP, Server Technologies
Oversees product development and delivery of database products, including Oracle Application Server. Previously spent 17 years with Digital Equipment Corp.

Thomas Kurian
Senior VP of Development, Oracle Application Server
Before joining Oracle in 1996, he was a consultant with management consulting firm McKinsey & Co.

Oracle Application Server 10g is available in three bundles. The most basic, the Java edition, provides an integrated Web server, Web services support and JDeveloper, a Java development environment. To the baseline package, the Standard edition adds portal, single-sign-on and content-management components. The Enterprise edition includes Web caching, reporting tools and connectors to third-party applications.

Reference Checks

Master Lock
Marti Gahlman
Dir., E-Commerce Solutions
Project: Lock maker uses Oracle Application Server to run its online order-tracking application, which pulls information from its Oracle Order Management system.

Louisiana Dept. of Natural Resources
Rizwan Ahmed
Project: Agency runs, which provides public information on oil and gas resources in the state, on Oracle Application Server.

Lansing Community College
Glenn Cerny
(517) 483-1802
Project: Michigan community college deployed Oracle Application Server as the basis for its online information system for students and faculty.

Office of Naval Research
Jim Campbell
Senior Database Administrator
Project: The U.S. Navy's research arm deployed Oracle Application Server two years ago to accept research proposals over the Web.

Mary Fonder
CIO, VP of I.T.
Project: Metal-enclosure maker installed Oracle Application Server to let employees more easily retrieve product-quality information from its AS/400-based resource-planning system.

Burlington Coat Factory
Mike Prince
Project: The 315-store retailer lets employees generate reports from Oracle databases with Application Server.

Executives listed here are all users of Oracle's products. Their willingness to talk has been confirmed by Baseline.


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