Ellison Launches (Another) NC Firm

SAN FRANCISCO (05/08/2000) - Some habits die hard. For Larry Ellison, starting companies that build network computers is one of them.

The colorful chairman and chief executive officer of Oracle Corp. helped to launch a new, independent venture today called The New Internet Computer Co.

(NICC). Funded by Ellison, the firm will sell a US$199 "non-PC" device called the NIC (for New Internet Computer) that has no hard drive, doesn't run Windows, and provides access to e-mail and the Internet.

The first NIC will be targeted at educators and will provide students with a more affordable alternative to the PC for accessing the Internet and e-mail, said Gina Smith, a former technology journalist who was enlisted by Ellison late last year to be the new company's chief executive officer.

"We're not positioning this as a replacement for the PC," Smith said in an interview this morning. "Schools will still use PCs, but they don't have enough of them and the cost of maintaining them is very high."

At the end of the year, "The NIC," as Smith likes to call her company, will offer a version of its Internet computer targeted at consumers. The consumer version will also be priced below $200 and serve primarily as a way to access e-mail and the Internet.

If Ellison's plan to launch a network computer company sounds familiar, it should. Back in 1995, the Oracle chief was one of the original advocates of the NC, a device he predicted would displace PCs by offering a more affordable and efficient way for accessing the Internet.

Ellison created Network Computer Inc. (NCI), an Oracle subsidiary with a mission to evangelize the concept and provide software for the devices. The network computer never took off as Ellison and other advocates had predicted, and in 1999 NCI changed its name to Liberate Technologies Inc., switched its focus to software for interactive television, and launched a successful IPO (initial public offering). [See "Oracle's NCI Reinvents Itself," May 19, 1999.]The new company launched today won't be a rerun of NCI, Smith said.

"Everything's different," she said.

The original NCs used a proprietary operating system and had to be used in conjunction with a server that hosted its software applications, she said.

NICs, by contrast, run on the Linux operating system and come installed with a 56K-bps modem and Web browser from Netscape Communications Corp., which is all they need for accessing the Web, Smith said.

"In many ways, they're more akin to the Internet appliances that you see being introduced" from companies like Compaq Computer Corp. and Gateway 2000 Inc., she said.

The NIC's software programs are stored on a CD housed inside the computer, along with several browser plug-ins for running Macromedia Inc.'s Shockwave, RealNetworks Inc.'s RealAudio and other Internet downloads. The CD can be taken out and replaced by a network administrator, allowing NICC to upgrade the software in the machines as it sees fit.

For educators who want more than basic Web browsing and e-mail, the CD also contains client software from Citrix Systems Inc., which will allow the NIC to run server-based versions of some Windows applications, such as Microsoft Word, if they want to, Smith said.

The first 1,000 NICs are in the process of being installed at a school in Dallas at no charge as part of a philanthropic program at Oracle. Other educators in the U.S., Latin America and Europe can order the machines for purchase immediately, she said. The NICs are being manufactured by a Taiwanese firm which Smith declined to identify.

Apart from starting a computer magazine many years ago, Smith said she's had no prior experience running a company. She said her work as a computer journalist has taught her what users want from a computer and what they find most difficult to deal with.

She became acquainted with Ellison through conducting interviews with him over the course of several years. When Ellison introduced the first network computer concept in the mid 1990s, "I told him I thought it would make a hell of a consumer item," she remembered.

Ellison called Smith late last year and, telling her he had "an offer you can't refuse," offered her the job running The New Internet Computer Co., Smith said today.

She accepted because "it's one of those opportunities that comes along once in a lifetime," she said. She added: "But then you think -- I've been a journalist all my life -- what will the press think, what will my mother think?"

Ellison and Smith talked up their new company this afternoon at a press conference at Booker T. Washington High School for the Performing and Visual Arts in Dallas. The event will be archived on the Web at Oracle's eBusiness Network Web site at http://www.oracle.com/ebusinessnetwork/.

NICC, in San Francisco, can be contacted at +1-415-786-8604. The company's Web site at http://www.thinknic.com/ is due to go live today. Oracle, in Redwood Shores, California, can be reached at +1-650-506-7000 or via the Internet at http://www.oracle.com/.

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