Oracle plots major Web broadcast network

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Oracle Corp. is preparing to launch an Internet audio-video broadcast network in February that promises to be the most ambitious Internet network project so far by a b-to-b marketer.

The Oracle E-Business Network, set to be announced Feb. 1, will offer unrestricted access to separate business, technology, education, lifestyle and events channels in nine languages, and will be targeted at customers, investors and technology junkies, said Mark Jarvis, Oracle's senior VP-worldwide marketing. Mr. Jarvis is spearheading the project for the Redwood Shores, Calif.-based database giant.

"This is the first ever. There isn't a technology industry Internet broadcast network today," Mr. Jarvis said. He said that while CNET and ZDNet repackage TV content for their Web offerings, Oracle is creating content just for the Internet.

With the network, Oracle is among the front-runners in using broadband to move the Web from a print to a video medium--a change that will also alter companies' marketing strategies. Oracle will now be positioned to become a leader in using the Internet's low-cost content creation and distribution to communicate daily with its audience.

Media competitor

Perhaps most important, Oracle will now compete head-to-head on the Web with the business media that have traditionally captured the company's advertising--and its ad dollars.

"This is a big shot across the bow," said Jeffrey Dearth, managing director, DeSilva & Phillips, New York.

Oracle plans to fill the network with in-house content and syndicated material from, Palo Alto, Calif., and financial network ON24, San Francisco. The company is negotiating additional deals, including one with Reuters.

Oracle and its business partners plan to advertise on the network, and Hewlett-Packard Co. and other tech companies will develop programming in exchange for sponsorship positions, he said.

Oracle will develop its own E-Business Network programming by dipping into the $20 million it has saved over the past two years by reducing direct mail and collateral material, Mr. Jarvis said. Additionally, Oracle has already built in-house broadcast facilities for internal sales training, so capital equipment costs are "zero," he said.

Mr. Jarvis said Oracle has spent $5 million to $10 million to develop the network so far. It plans to spend another $5 million to $10 million on content this year.

Oracle plans to launch the project with a spot radio campaign in the top 10 U.S. markets.

Oracle sees the network as a revolutionary shift in its marketing strategy. "The idea here is that rather than pushing wares to customers, successful companies are going to create a marketing pull by informing, educating and entertaining their audience," Mr. Jarvis said.

Seminars are key to Oracle's E-Business Network strategy. The company gets about 400 attendees for each of its Web seminars, while about 100 people attend an average brick-and-mortar Oracle conference.

"Why would we run a [real-world] seminar, when we can run it on the Internet at a lower cost and draw more people?" Mr. Jarvis asked. "By the time we're done with mailers, hiring the room, making binders and the rest, it costs us $350 per attendee. We calculate our cost on the Internet at $1.92."

Driving e-business

A central goal of the network is to strengthen Oracle's own e-business and e-commerce efforts on its Web site. The E-Business Network will drive traffic to the Oracle Exchange, a service to suppliers that allows them to link supply chains and reach customers on the Internet.

Mr. Jarvis predicts the network will become a marketing template, adding, "We're frankly surprised one hasn't been launched before."

Other companies, such as electronics component distributor Marshall Industries, recently acquired by Avnet, Phoenix, promote and demonstrate products through rich-media Internet broadcasts. A full-scale network, however, is a significant expansion of the idea, said Jim Nail, senior analyst at Forrester Research, Cambridge, Mass.

"This is on a scale of the `Intel Inside' co-op marketing, channel-partner strategy with some key twists for e-business," Mr. Nail said.

Despite producing content and selling advertising, Oracle does not see itself competing with business media companies, Mr. Jarvis said. "We have no intention of competing with media companies, or spinning the network off," he said. "We're in no position to be considered competitive with broadcast companies. We're creating content and syndicating content to add value. This is being done for innovation, not competition."

Robert Krakoff, chairman-CEO of Advanstar, Boston, sees the network as potential competition for business publishers. "I don't think it's a unique threat," he said. "It's just direct marketing, like a custom publication. It's just another way to do it."

Others view a marketer creating its own network as presaging a larger shift in marketing roles. "These days convergence means everybody is sort of getting into everybody else's business," Mr. Dearth said. "All of a sudden you have advertisers essentially creating their own channels of information that will compete with traditional information providers. The issue will become one of how credible is that information?"

Traditionally, tech companies have not fared well in the content business. IBM Corp.'s InfoSage, a subscription news service, failed and closed in 1996. Microsoft Corp. has had mixed results, with its biggest triumph coming from the MSNBC joint venture.

An additional hurdle facing Oracle is that video streaming on the Web is still primitive. Alan Meckler, chairman-CEO of Internet.

com, an online news network for the Internet industry, said his company is planning an Internet broadcast channel, but won't launch it until the technology makes it feasible. "There's not enough bandwidth around yet," he said.

Rob Enderle, VP-mobile and desktop technology at Giga Information Group, Cambridge, Mass. agreed. "It's the wave of the future," he said of an Internet video network, "but it's a little ahead of the wave."

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