Flying with the penguin

Oracle is making substantial inroads in the Linux market with its innovative support policy, says Srikanth R P

It is a market that has just begun to soar with database major Oracle providing the rocket fuel for the Tux to fly. Oracle is playing the total cost of ownership (TCO) card by using Linux as a platform for making inroads in Indian enterprises running peripheral but important applications such as Internet banking, branch automation, HR and payroll. Traditionally dominated by Novell’s NetWare, this market is of strategic importance. Oracle was among the first players to identify this trend by developing Oracle 8i for Linux almost six years ago. Today it is reaping the benefits of placing an early bet on Linux.

Companies that run Oracle products on top of Linux include the Indian Railway Catering and Tourism Corporation, Bharti Telesoft, Eveready Industries, South Asian Petrochem, Kotak Mahindra Bank, IDBI Bank, Central Bank of India, Department of Treasury (Government of West Bengal) and Bharat Sanchar Nigam. Additionally, Oracle’s partner, Zenith Infotech, has around 35 clients in the banking vertical who have deployed Zenith’s branch automation product using the Oracle database on Linux.

Although the market for solutions running atop the Oracle-Linux combination remains a small one, it exhibits considerable long-term potential. Oracle is playing for the long haul as it believes that once the platform becomes stable, its support and the availability of third-party software applications will give it an edge over other players. Moreover, Linux helps Oracle push for a low TCO proposition as it runs on relatively modest hardware.

Says L Gopalakrishnan, director, Platform Technologies Group, Oracle India, “We were one of the first vendors to notice the shift towards Linux. Our support for the operating system has paid off in India as we are gaining a huge list of customers using the Oracle-Linux combination.” Recent years have been especially good, with Oracle citing “tremendous growth.” As of date, all Oracle products are certified on Linux. A slow shift towards Linux is taking place; the company shipped 13 percent of its product licences on Linux in India in 2003 compared to almost zero in 2001.

Oracle recently announced that Linux had emerged as the second-most popular platform for the 1,80,000 Indian developers registered on the Oracle Technology Network. Oracle’s India Development Centre (IDC) is a linchpin in Oracle’s Linux initiative as the group has done extensive work on customising Oracle’s products on Linux from the very first release of Oracle 8i on Linux. The IDC works in tandem with the company’s sales team and the developer community. This has helped Oracle customise its products on Linux to the Indian context. It has also suggested improvements in I/O throughput, memory utilisation and SMP scalability that have gone back as improvements to the Linux kernel.

While Linux will certainly not become the dominant platform overnight, it is increasingly becoming important for vendors. As Gartner India’s research director, Pranav Kumar observes, “Linux will be one of the drivers of application software growth, but not the only one. However, due to market development efforts by vendors, Linux will increasingly enter the consideration set of users.”

Making Tux credible

While Linux has been hailed as an excellent OS all along, the lack of support from big vendors has proved to be harmful to its growth. Oracle’s weight behind the penguin has given Linux a big boost.

Says Akash Saraf, joint managing director, Zenith Infotech, “Oracle has clearly given greater credibility to Linux.” Saraf should know. His company’s branch automation product is now running in a host of Indian rural banks using Oracle on Linux as the back-end database. Although small, adding up the numbers gives a customer base that is one of the biggest in terms of adoption. Seven of the larger implementations alone add up to 544 branches.

Oracle’s growth in Linux has not been restricted to its flagship database. Almost every product of the company has a reference client. IDBI Bank runs Oracle Financials and HRMS on Linux, Kotak Mahindra Bank uses the Oracle Application Server on Linux for its Internet banking initiative, while Eveready is running Oracle E-Business Suite, Oracle E-Collaboration Suite and Oracle 9i on Linux.

Clustering is popular with India Inc. Says Javed Tapia, director, Red Hat India, “The clustering capabilities of Linux along with Oracle Cluster technology let enterprises deploy low-cost failover or load balancing on their Oracle infrastructure.”

TCO as bait

In the price-sensitive Indian market, a promised lower TCO is an attractive selling proposition. Oracle is using this argument to persuade CIOs. Companies such as Central Bank and Eveready see potential savings of at least 30-40 percent on their IT investments by deploying Oracle on Linux.

Says Arup Chaudhury, GM, IT, Eveready, “We chose the Oracle-Linux combination since it gives us the same performance as a RISC platform with around 50 percent savings.”

IDBI Bank is also touting the tremendous cost savings of the Oracle-Linux combination. Says Sanjay Sharma, the bank’s CTO, “While we have scaled up from around 400 users to 2,000, using the Oracle HRMS system on Linux we have hardly made any new investments in hardware.” Companies that have gone in for this combination have found that there are fewer problems with regard to viruses and vulnerabilities.

Sorting out issues with Linux

While many vendors have ported their applications on to Linux, Oracle has gone a step further. It offers to fix issues related to the Linux kernel. This has acted as a huge confidence-booster to customers as they do not have to run to separate vendors (the Linux vendor and the product vendor) for ironing out their problems. As Kumar of Gartner says, “Support from Tier-I vendors is important for the growth of Linux. It is one of the biggest issues with Linux, and direct support from Tier-I vendors will do much to increase adoption.” By understanding this problem, Oracle has boosted its market share and user base on Linux.

Comments Nitin Gupta, analyst, GTM Services, IDC India, “Oracle’s initiative has had a positive impact. Once support is strengthened, we will see more traction.”

In 1998-99, Oracle’s support policy was similar to that of other enterprise application vendors. The policy stated that the company could be contacted for problems with an Oracle application. In case of underlying problems with the Linux OS, users had to go to Red Hat. Then Oracle realised that it had to address Linux-related issues if it wanted the Oracle-Linux combo to succeed in a big way. Today, Oracle provides first-level support for Linux, including taking ownership in fixing kernel-related issues, something the company does not do for any other OS. This initiative has put a stamp of authenticity on Linux as far as CIOs are concerned.

Agrees Chaudhury of Eveready, “As Oracle takes responsibility for patches and updates, we have to deal with only one vendor for problems concerning the OS and the application. The same support is not available for other platforms.” IDBI Bank was initially hesitant as a project using Oracle HRMS and Financials on Linux was a new concept. Once Oracle certified the Intel Linux platform—backed by a promise to solve any Linux-related issue—the bank decided to go ahead.

Oracle’s successes on Linux show that porting applications on to Linux is not enough. Other enterprise application vendors have also ported their applications on to Linux, but they have not taken ownership of the penguin. This, in turn, has created doubts in the mind of the Indian CIO. Oracle has thus started gaining in a market where none of its competitors have a significant presence.

Riding with the penguin
Customer	Oracle product on Linux
IRCTC	Oracle E-Business Suite
IDBI Bank	Oracle Financials and HRMS
Kotak Mahindra Bank	Oracle Application Server
South Asia Petrochem	Oracle E-Business Suite
Eveready	Oracle E-Business Suite, Oracle Collaboration Suite and Oracle 9i

srikanth@expresscomputeronline.com