CeePrompt! Computer Connection

Originally published June 10, 2002

Let's talk Oracle

Since early May, hardly a day goes by without some mention of the contentious $95 million Oracle deal that has cast a pall on the governor's office. Whether in the newspaper, over the radio or on television, the debate rages on about the no-bid contract awarded by the state of California to Oracle that seems suspiciously timed with a $25,000 contribution to Gov. Gray Davis' campaign coffers by Oracle. Some observers have gone so far as to liken the controversy to the Enron meltdown.

During this time, I've been asked to translate, "What's Oracle? What's an enterprise agreement?" and "What's really the beef?" aside from the possible political fallout. Oracle is not a product that the average home or home-office user would be readily familiar with, like Word, Excel or Quicken.

It's a premier database product that has earned the distinction of being the second largest-selling software package in the world. As you might expect, Oracle founder Larry Ellison is routinely among the top five richest men in the world, according to Forbes magazine. In the year 2000, he was second only to Bill Gates of Microsoft.

Oracle outsells all other similar programs throughout the world and holds the largest market share for both Windows and Unix based databases. Oracle provides additional business software applications, dubbed "enterprise solutions" that are Internet compatible. This isn't your everyday home-office application used to balance your checkbook or surf the Web.

A database is any organized collection of information. In its most rudimentary form, it's a table, with columns defining the fields such as First Name, Last Name, Company and rows designating individual records.A Christmas card mailing list or your e-mail address book are both examples of a database.

A relational database such as Oracle consists of many tables -- thousands perhaps -- that have logical relationships to each other, enabling the production of new tables with unique information. Databases of this stature are designed to manage millions of records for organizations such as the Army, Xerox or Wells Fargo Bank. How do you suppose you're targeted for the Publisher's Clearing House Sweepstakes? A huge database tracks how many times you've been suckered into sending back the forms and pasting those stamps into the appropriate locations and then promptly sends you another solicitation.

With a population of 34 million people, it makes sense that the state of California would look to a company such as Oracle to manage the business of the state. California has a poor track record when it comes to making sound technology decisions dating back to the 1990s when tens of millions of dollars were wasted in attempts to computerize departments, such as the DMV and state lottery.

The Oracle "beef" comes over the potential 270,000 database licenses involved. Licensing agreements follow the computer or end-user. If you have five computers running Office, for example, legally you should have five licenses. Volume licensing agreements, also called enterprise licensing, allow large organizations to buy licenses and maintenance agreements in bulk.

In the case at hand, Oracle would grant a license to every California state employee, and long-term savings to the state through this arrangement was ensured. State auditors disputed the need for 270,000 licenses, however, since not all employees required database software for their position, hence the ultimate cost to taxpayers of $41 million instead of the projected savings. Furthermore, the audit revealed that only five of the 127 state agencies were truly interested in the new database licenses.

Oracle stands by its projections of long-term savings, but the specter of conflict of interest combined with the no-bid contract and the untimely campaign contribution makes this deal a little more than fishy.

Cathi Schuler owns a computer literacy training/consulting company, Cee Prompt! She is a co-author of computer textbooks and can be reached by e-mail at cschuler@uop.edu or cschuler@ceeprompt.com or by mail c/o The Record, P.O. Box 900, Stockton, CA 95201. She is on the Internet at: http://www.ceeprompt.com. Click here for past archived columns.

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