Aiming to lead the development of a new type of low-cost, network-oriented computer that could partially displace the traditional PC, database software vendor Oracle Corp. said it has it has designed three inexpensive Internet-access terminals that it will license to consumer electronics vendors.
"What we're saying is that there's a need for a whole new class of computer for people who don't want to do much more than a little word processing, sending and receiving electronic mail and accessing the Internet," said Farzad Dibachi, Oracle senior vice president of new media. "That kind of machine doesn't need to be expensive."
Dibachi said the devices--one of which resembles a compact personal computer, another that looks more like a fancy telephone, and a third that sits atop a TV set--would cost about $500. Oracle is in negotiations with major consumer electronics firms to produce the devices, Dibachi said, and hopes to see them on the market by the middle of next year.
Oracle's co-founder and chief executive Lawrence J. Ellison has been a vocal critic of personal computer manufacturers, who he contends make machines that are "too expensive and too difficult to use." He is among a growing legion of industry executives who believe that the growth of the Internet will fundamentally change the PC landscape and pave the way for a new breed of inexpensive "network computers."
Computer workstation manufacturer Sun Microsystems Inc. disclosed a few weeks ago that it is working on a similar kind of machine. PC manufacturers such as Compaq Computer are looking at the possibilities too, although no products have yet been announced. Such machines would, in theory, appeal to a vast new market of people who are computer illiterate or unwilling to spend $2,000 for a PC. Their strength would be not in computational power, but in their ability to send and receive information efficiently.
Oracle will charge a minimal licensing fee for its network computer designs, because its main aim is to spur demand for its database software products. "What we make or don't make on this device doesn't really matter," Dibachi said.
Oracle's software is now used mainly by large corporations to store critical information such as payroll records. But the company hopes to build a big new business selling software for the "media servers" that will supply video, audio and other information over the Internet and interactive TV systems.
One of the new Oracle computers, called the Internet terminal, resembles today's PC, except that it is more compact, and the keyboard and monitor are tightly coupled. Unlike the PC--which sports a complex array of wiring--the Internet terminal has only two cords, one for power and another for telephone access.
A second device looks like a telephone with the addition of a 5.25-inch, color liquid crystal display. A third is a "set-top box," a computer that enables a TV to access the Internet and manipulate the information that has been downloaded.
Dibachi said these machines will be a fraction of the price of a PC because they will use cheaper microprocessors and will not have expensive peripherals such as large monitors and CD-ROM drives. Intel Corp.'s Pentium microprocessor, the engine of most PCs being sold today, costs about $450, but the powerful microprocessors used in many of the video game players cost a fraction of that.
Although Oracle has not decided what software will run on the computer, it has ruled out arch-rival Microsoft Corp.'s Windows 95. "It's too difficult to use," Dibachi said.
Apple Computer Inc. is a possible software supplier, but "we want to license this design broadly and Apple hasn't been interested in that kind of strategy to date," Dibachi said. "And there's a problem in that they're losing mind share and market share."
Oracle and Apple have co-developed a set-top computer that is being used in three video-on-demand trials. Currently, Oracle's database software is being used by 20 telephone companies experimenting with television services such as movies-on-demand and home shopping.
And Ellison has been rumored to be interested in acquiring the venerable personal computer manufacturer. However, Ellison has maintained that he would not do a hostile takeover of Apple, and the company's chief executive, Michael Spindler, is insistent that the company is not for sale.