Ellison Touts Oracle's New Hardware-Software Integration Model

Oracle Corp. (ORCL) Chief Executive Larry Ellison touted on Wednesday his company's strategy for delivering integrated products, rather than selling only the software that customers must then load onto computers made by other companies.

"Our strategy is to take a lot of separate pieces our customers used to buy as components and to deliver complete working systems," Ellison said in a keynote address at the company's first annual customer meeting since Oracle bought hardware maker Sun Microsystems Inc. in January. "That will make our customers' lives simpler. It is fast and cost effective."

Ellison's comments come as many companies in the technology industry have jealously watched Apple Inc.'s (AAPL) success with its iPhone and iPad products. Those products feature hardware and software designed to work together.

"Steve Jobs is my best friend," Ellison said, referring to Apple's cofounder and chief executive officer. "I watch very closely what he does over at Apple. If you engineer the hardware and software, the overall product is better."

Others appear to agree. Last week, PC-maker Hewlett-Packard Co. (HPQ) offered roughly $1.5 billion for security-software maker ArcSight Inc. (ARST), which followed its earlier acquisitions of privately-held Fortify Software Inc. and Palm. In August, semiconductor maker Intel Corp. (INTC) said it would buy McAfee Inc. (MFE), a leading software security firm, for $7.7 billion.

Ellison provided two new examples of the Redwood Shores, Calif.-based company's strategy. Both the Exadata X2-8 database and the Exalogic Elastic Cloud, announced here this week, contain Oracle software integrated into Sun hardware.

The first is a database loaded onto a server and the other is a "cloud in a box" server that companies use to set up a private cloud.

Cloud computing uses the Internet to access data and applications based in remote datacenters. A private cloud is a datacenter set up and run by a company for its own use.

On Wednesday, Oracle shares rose 1.4% to $27.20.

-By Jeanette Borzo, Dow Jones Newswires; 415 765 8230; [e-mail]