The Oracle Speaks

Larry Ellison has never been shy of publicity. The richest man in Silicon Valley and the relentlessly aggressive founder of the relentlessly aggressive Oracle software company has cultivated an image as a computer-industry leader more like a James Bond villain (building a $100 million 16th-century Japanese-style estate, sailing world-class vessels, flying jet-fighter planes and squiring beautiful women) than a numbers-obsessed geek. Still, it raised a few eyebrows when the unpredictable Ellison agreed to put himself under a microscope for "Softwar," an ambitious book by Matthew Symonds that comes out this week, with a running commentary in footnotes from Ellison himself. Before taking his America's Cup-contending boat Oracle BMW for a Moet Cup rematch against the champion, Alinghi, Ellison recently found time to talk to NEWSWEEK's Steven Levy about Oracle's future, the ongoing competition with Microsoft, his attempt to buy competitor PeopleSoft, his evolving management style and what he so likes about the Japanese esthetic.

LEVY: You say in "Softwar" that your goal is to make Oracle not only the most important software company, but the most influential company in the world.

ELLISON: The most important soft-ware company is almost always the most influential company in the world. IBM was the most influential company in the world because during the era of mainframes, it dominated mainframe --computing--because of their software. Microsoft now is certainly the most powerful, and probably the most important, company on earth.

Can you surpass it from your perch as a database and enterprise-application company?

If the world continues to be dominated by desktop personal computers, the answer is no. But I think we're seeing a gradual shift away from the desktop and toward Internet computing. There's been three eras of computing. The first era, dominated by IBM--mainframe computing--the second era, personal computing, dominated by Microsoft. I think someone will emerge in enterprise or Internet computing as the dominant supplier of software technology. Microsoft has this unique position of being a monopoly provider in personal computing, which they're trying to leverage into a strong position on the Internet. Look what they did to Netscape. But that's our challenge, and I think we have a chance.

Let's talk about your effort to buy your competitor PeopleSoft. Oracle has made an offer that some say is insufficient, but you are now saying you're not going to increase it.

I don't think we have to. I think it's a very generous offer and we're just waiting for the government to give its OK, and we're optimistic that's going to happen, and then we'll complete the acquisition.

Your opponents have personalized this.

Yeah. I know [CEO] Craig Conway has tried to make it personal; it's not personal at all. I don't think about him. We'd like to buy PeopleSoft, and we've made a very generous offer to the shareholders. Conway's not an owner. He's a tenant. And you know, when you're the tenant and the owner sells the building, sometimes you have to move. We think the owners, the shareholders, will accept the offer, and the tenants--Mr. Conway and his board--will have to move.

What value do you think this will bring to Oracle?

I think it will make us a stronger No. 2 in the applications business to SAP. We've heard from lots and lots of PeopleSoft customers who want to have the strongest possible company behind the applications that they're using. Who would you want to build your applications? A strong company or a weak company?

You're very critical of Microsoft's behavior, but Oracle shows no mercy to its competitors. Is Oracle more moral than Microsoft?

We haven't been found guilty of breaking the law. They have. We believe in competing to the best of our ability, doing everything we can to beat our competitors--within the boundaries of the law.

In the book "Softwar," you imply Bill Gates is flawed as an individual--for not being as well rounded as you.

I don't think that those are criticisms. Those are observations. Bill is absolutely single-minded. A lot of people at Oracle probably wish I was more single-minded, wish I didn't sail, wish I didn't fly airplanes. So that was not meant as a criticism at all.

The book deals extensively with internal struggles at Oracle. Do you think your company has an unusual amount of behind-the-scenes drama?

It happens in every organization. People in presidential administrations are replaced, people on football teams are replaced. As companies change you always try to put the best team on the field, and that's what I've always done because I've always wanted Oracle to win.

How would you describe your management style now, compared with when you were just starting the business, or earlier?

I used to treat other people the same way I treated myself. I was very brutal with myself about my own mistakes, and I just passed on that brutality to others. I've learned over the years to temper that. People aren't perfect. And I have a little more empathy with human fallibility.

Are you still just as tough on yourself?

I'm probably still pretty brutal with myself. I'm very, very competitive, and that's deep in my nature.

What do you think it is about the Japanese style that appeals to you?

The Japanese esthetic always has had ingredients from nature. It's really a collaboration between God and man. I feel more at home in a Japanese garden than any other spot on earth. I think it's hard-wired into our nature. The sound of running water or the smell of moist pine needles in the air, the sound of wind in the bamboo--all of those make us feel comfortable and tranquil and at home and safe. That's why my new house is basically not a house at all, but really a garden.

You almost died in a 1998 Sydney-to-Hobart sailboat race. When things looked grim, did you ask yourself how you would be remembered?

No, I just thought, I just spent a lot of money to sail this race and I'm gonna end up on the bottom of the Bass Strait. What a stupid way to die.

Well, now that you're a little drier, do you ever think how folks might remember you?

Not a lot. I really don't spend a lot of time thinking about legacy. I think the Japanese garden that I built in Woodside [California] is going to be around a very, very long time, and I think I'll be remembered for that. But I'm still in the game. I'm not ready to think about legacies. I'm really still trying to beat Microsoft.