Ellison Speaks On Oracle Partner Challenges, Security

The only audience question at Oracle OpenWorld that seemed to rattle the facade was whether the database--and now applications--giant would commit to fixing known security flaws within a quarter of their discovery.

His answer: "No."

The questioner, an attendee, thanked Ellison for his frankness. The Oracle CEO then expanded, briefly.

"What he asked for is impossible. We cannot commit to fix whatever happens within a certain time period."

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Ellison also said in his keynote that the last time Oracle's database was broken into was 15 years ago. "When Microsoft put up a database to track customer credit-card numbers, it took 45 minutes to be broken into. I'm not here to make fun of Microsoft. Well, not a lot," he noted.

Asked later by a reporter about that 15-year claim, Ellison clarified. Databases must be set up and used properly to be truly secure, he said. If someone were to post his user name and password on the Internet, which is then used to enter a database, that is not the same thing as someone hacking into the database, he noted.

"You can build apps that are not secure on Oracle. You could make everyone's password 'welcome'. But if you build a secure application, you cannot break in. Nobody," Ellison said. "I shouldn't say nobody. But I could tell you who could break in, and they're all on our side."

Ellison also said Oracle is becoming more channel-friendly. The Redwood Shores, Calif., company announced plans to work with Ingram Micro, Tech Data, and Avnet to recruit channel partners this week.

"Our biggest problem with the channel before was not that we couldn't get channel parners--Dell is one of the biggest resellers in the channel--it was getting pricing that makes sense on Dell machines for the SMB marketplace. Now we have low-cost versions of Oracle," he said.

The fact that Ellison referenced Dell as a channel partner illustrates to many Oracle's basic problem. The army of solution providers and VARs that Microsoft has used to entrench SQL Server in small and midsize businesses, and even in the enterprise, tends to view Dell as something like Darth Vader.

"I don't think Dell or CDW have any business selling Oracle software," said one longtime Oracle VAR partner at OpenWorld.

Another reseller partner was less adamant. "They have to make their software available however people want to buy it. It's 'Wal-Martization' of the business," he said.

Ellison told reporters that Oracle is doing much better with partners. "We have a much better channel program in Europe and Asia than in North America, where we have been more channel-challenged," he said.

And with its well-publicized acquisitions, Oracle is gaining more partners all the time. "We have a channel we inherited from J.D. Edwards, and we're learning to be a better channel company," Ellison said. "Microsoft is a pure channel company, and we were pretty heavily biased toward direct sales. But it's a learning process."

Ellison also brushed back any suggestion that Microsoft solution providers--soon to be armed with SQL Server 2005--will create pricing pressure for his company.

"Our list price for some versions of Oracle is lower than SQL Server. ... Some are higher and some lower," he said.

Ellison also made a Microsoft-like argument in favor of Oracle's consulting business, which many large integrators see as a competitor.

"We're in that business because it gives us an intimate perspective on our products and how well they work. We're not handing a disk over to IBM Global Services and saying, 'I dare you to use it,' " he said.

But like IBM and even Microsoft, Oracle counts its consulting division as a profit-and-loss statement, which partners say inevitably leads to conflict.

Just last week, Microsoft Chairman Bill Gates said that although Microsoft tasks its own consultants to get in and out of accounts as fast as possible, it's in the best interest of IBM and Oracle consultants to prolong their engagements. Many integrators argue that all three of the software giants present competitive challenges to partners.

Ellison conceded that some conflict is inevitable. "Sometimes we're in the awkward situation of competing with our partners like Accenture, [but] we've cut back a bit," he said. "Consulting is a boom and bust, crazy business. Sometimes you can't hire people fast enough, and then you have to fire them all."

Oracle does a lot of subcontracting with partners such as IBM Global Services and Accenture but will act as prime contractor at a customer's request, Ellison said.