Oracle slashes business-management software price

REDWOOD SHORES: Oracle Corp. on Tuesday outlined a plan to slash the price of

its business-management software by up to 75 per cent as it battles a tough

competitive environment.

Key to the new global pricing policy is an option that enables customers of

the world's No. 2 software maker to buy -- for a flat fee of $4,000 per user --

Oracle's so-called 11i e-business suite of software that automates such things

as marketing, sales, procurement, financials and human resources.

Under Oracle's current pricing program, which also remains in place,

different software components are sold separately. For example, Oracle

financials are now quoted at $3,995 per user.

Customers that choose to buy Oracle's e-business suite under the new per-user

plan could save 25 per cent to 75 per cent, Jacqueline Woods, Oracle's vice

president of global practices pricing, said during a conference call on Tuesday.

However, the new pricing is subject to a minimum applications license fee of

$250,000. Customers who have already bought different Oracle components

separately may be credited the price of their original net software license fee,

provided their new license fee is at least $250,000.

The new pricing is effective Feb. 1 and comes about a month before Oracle is

set to wrap up its fiscal third quarter in a harsh economic environment that is

forcing many companies to cut prices in an effort to build or maintain market

share.

Oracle, which once pitched its 11i software as a key driver of future growth,

grappled with bugs in early versions of the software that competes with

offerings from rivals such as SAP AG, PeopleSoft Inc. and Siebel Systems Inc.

During the Redwood Shores, California-based company's recently reported

fiscal second quarter, revenue from Oracle's e-business software licenses and

updates declined 26 per cent from the year-ago quarter. License and services

revenue related to Oracle's applications business accounted for less than

one-third of the company's total revenue.

Oracle shares ended Tuesday's regular Nasdaq session down 40 cents, or about

2.4 per cent, at $16.50.

(C) Reuters Limited.