Oracle will unveil its Media Server and other related software at a glitzy event hosted by Walter Cronkite and simulcast in Tokyo, New York and Washington.
The showcase, scheduled for Jan. 18 but postponed by the Los Angeles earthquake the day before, is designed to plant the Oracle name firmly in the mind of anyone who's anyone in interactive media-movie moguls, media companies, home shopping networks, telephone carriers and cable TV companies.
"We decided Los Angeles was a good place to host it because certainly the Hollywood audience was a big audience for us," said Kate Mitchell, Oracle VP-corporate marketing. "They are the people who own the content."
In recent months, Oracle has executed an integrated marketing program involving public relations, a few ads, high-level schmoozing at political and charity events and presentations to key executives in the companies most likely to buy the Oracle Media Server, a software package for huge computers that can store thousands of hours of video, sound and text.
The efforts have worked well, so far. Bell Atlantic Corp., U S West, Capital Cities/ABC and Washington Post Co. have all agreed to use Oracle software in tests of interactive TV. In Bell Atlantic's case, the Baby Bell will buy four Media Servers, each capable of delivering 25,000 different video streams, for its Stargazer test.
Oracle is likely to announce several more partnerships at tomorrow's event.
The costly marketing campaign-the Hollywood launch alone will cost several million dollars-has been designed, ultimately, to reach key decisionmakers at no more than 200 companies, Oracle estimates, and perhaps as few as 15.
"We're not selling $99 software; we're selling $20 million systems," said Terry Garnett, senior VP of Oracle's new-media division, citing the combined cost of software, hardware and consulting services. "It's like the difference between selling bicycles and Ferraris."
Oracle's journey from corporate databases to interactive media followed no obvious path.
Oracle, co-founded by Mr. Ellison in 1977, found a profitable niche for itself in developing database software for large computers. Oracle is the top corporate supplier in that area, generating $1.5 billion in revenues last year.
In truth, Oracle stumbled onto the information highway. Last year British Telecommunications, a longtime Oracle customer, asked Oracle for software to run a video server. Looking into the query, Oracle engineers discovered they had already done work that could help them handle video.
Realizing that his database software was directly applicable to interactive TV, Mr. Ellison set out to make his company over.
Even Chairman James Abrahamson, a retired Air Force lieutenant general and former head of the NASA space shuttle program, jumped in to develop relationships with key telecommunications companies and cable TV operators.
"We are seeing them slowly get into a new market," said analyst Paul Cubbage of market research company Dataquest. Added Chris Mortenson, managing director of Alex. Brown & Sons, "I believe it is clearly Larry Ellison's vision at work."
But not everyone buys Oracle's oratory on the data superhighway.
"They are not really refocusing, re-orienting and transforming the direction of the whole company for this market," said Stephen McClellan, securities analyst with Merrill Lynch & Co. "They are maneuvering early to be a leader in it, or at least to be a major role player, but the revenue flow will be pretty minimal for the next 12 months."
Oracle believes its system will work for interactive TV because it's been writing software to manage information for years.
Some data on the information highway is "structured"-lists of movies, catalogs of materials, prices of clothing-but more of it is unstructured: movies, audio, images. Oracle says it can handle both easily.
Oracle has bet much of its future on massively parallel computers. Such computers, instead of having a handful of high-price chips, have hundreds, even thousands of off-the-shelf chips and can process huge amounts of information much faster.
"Things like video on demand or news on demand-these are gigantic databases," an Oracle spokesman said. "To sort through all that information, you need incredibly powerful machines."
Massively parallel computers are very tricky to program, but Oracle, at the insistence of Mr. Ellison, has adapted its software for them. (So convinced is Mr. Ellison that massively parallel processing is the wave of the future that he has invested a considerable piece of his $2 billion fortune in nCube, which makes the computers.)
With the technology under its belt, Oracle set out to market its software.
The Media Server was previewed in September at the annual Oracle User Conference in Orlando.
But the Bell Atlantic-Tele-Communications Inc. deal, which set tongues wagging everywhere about the information superhighway, helped open doors for Oracle, as did a Nov. 29 Fortune article about the company.
Oracle is not the only computer company to stake its future on the information highway. Another software giant, Microsoft Corp., sees its fortunes tied to the digital highway, and hardware manufacturers from IBM Corp. to Silicon Graphics see themselves as key suppliers. That's why tomorrow's event is so important for Oracle.
"For the most part, we are not inviting existing Oracle customers," said Oracle marketing chief Ms. Mitchell. "We are inviting people who are going to be players with the National Information Infrastructure."
And it's inviting them to Hollywood.
"You can't go in and do an overhead presentation to these guys. You've got to have it in an environment that they're comfortable with to make it believable," Ms. Mitchell said. "It's got to look good; it can't be second rate."