Ellison: Give me control of your budgets

Oracle CEO Larry Ellison promised to slash customers IT bills by five per cent a year over the next five years - if they give him complete control of their IT budgets.

Unveiling details of Oracle's latest ASP strategy, at the AppsWorld conference in Amsterdam, Ellison promised customers an annual five per cent reduction in IT costs if they committed to a five-year hosting contract and allowed Oracle to hold the purse strings.

In return Oracle customers will receive a complete network revamp, with Oracle providing new software, hardware, technical support, maintenance and consulting. The deal also includes free upgrade to Oracle's 11i application suite

Oracle said earlier this week that it aimed to migrate 50 per cent of its customers to the new style ASP service over the next five years.

The new strategy is firmly grounded in Oracles long time opposition to best-of-breed software, with Ellison promising to rescue customers from the "hodge podge" best-of-breed approach.

Despite ASPs' fall from grace, and the obvious reluctance of IT directors to relinquish control of IT budgets, he remained confident the hosted service would be successful.

"We think we can make a lot of money at this. The degree of inefficiency we see in large IT departments is staggering ... We wish the whole Fortune 500 companies would take us up," he said.

Although Oracle's hosted service has been on offer for two years now, just 150 customers worldwide have signed up.

Ellison also said he was intent on taking Microsoft's pole position in the email server market, as the ASP deal will replace customers Microsoft exchange servers with Oracle's email server.

"It's the only server market Microsoft is in and we're going to take it," he predicted.