With Microsoft's SQL Server 7 firmly in its sights, Oracle Corporation on Wednesday slashed the price of its Oracle 8i database server 30-40% so that it can compete more effectively at the low end of the market. In Oracle's case, the low end refers to Windows NT 4.0 and the upcoming Windows 2000, where Microsoft SQL Server 7 is gaining ground. Oracle CEO Larry Ellison says the price cut is designed specifically to expand the company's database market share.
"We're going after NT file server market," said Ellison. "The timing couldn't be better for us to pursue this."
Oracle, which has historically catered to the high end of the market, will also be standardizing its pricing and discounts across the board, rather than continue its practice of rewarding high volume customers. And by the end of 2000, Oracle plans to book all of its sales over the Web. The company is opening its online store on Monday.
"Our customers say they would buy a lot more of Oracle and put more into our database if we lower the cost," Ellison said. "Every time we lower prices we sell more software."
Oracle reported record earnings earlier this week with net income of $384 million for the quarter ending November 30th. This compares to earnings of $274 million for the same quarter a year earlier