Net Results: In San Francisco this week, Oracle was partying like it was 1999. Prime dotcom-excess partying, that is, writes Karlin Lillington
The giant software applications and database company, now number two in the world and determined to lead the consolidation charge within the industry, gathered together nearly 45,000 people for its ninth annual Oracle OpenWorld user conference.
Of course, the company then had to come up with something to entertain them all for what is usually called the "customer appreciation event".
Even on the dotcom scale of major party blow-outs back in the years leading to crash time in 2000, Oracle's party was pretty spectacular. Once you have 45,000 people, you can book a big show arena just for your own shindig. And once you can book an arena, it's just a short leap to thinking, "we'll book Elton John for a private show". As you do.
And that's what Oracle did - took over the Cow Palace in San Francisco (named in this whimsical way because it was once a location for rodeos), set up five main stages and filled them with Sir Elton and support acts such as Joan Jett and Berlin (yes, really) plus chill-out places, techno dance floors, and more.
Oracle chief executive Larry Ellison wasn't leaving the arena obsession alone. Across the Bay, there's a huge arena where the Golden State Warriors professional basketball team plays.
Larry, having failed to buy the team a couple of years ago, instead decided to rebrand the arena itself. For the next decade, thanks to a $30 million (€23.8 million) deal, the Oakland Arena will henceforth be known as the Oracle Arena.
And you thought Michael O'Leary was good at garnering publicity? Larry and Oracle haven't been out of the news for two weeks thanks to all of this, none of it even directly related to anything the company does. And this is all "news" that has filled the non-business pages of papers, putting Oracle in the spotlight for those not remotely interested in computers, databases or hostile corporate takeovers.
Whatever about the databases - and Oracle has been getting good notices recently from the analysts who feel the company is successfully integrating all those company purchases such as PeopleSoft and Siebel, after all - Ellison has always been excellent at bread and circuses. Indeed, many years ago I was at Oracle's Christmas party (at the Moscone Centre, the same place OpenWorld was on this week) and Ellison literally produced circuses - performing all around us as we ate not just bread but an amazing array of food and drink.
Oracle tended to treat employees to lavish events on a regular basis, particularly its sales team and programmers. I was a tag-along with programmer friends and a bit gobsmacked by it all.
Back to 2006 and the company has enough muscle and cashflow not just to take over the Moscone but to get the city of San Francisco to let it close off an entire section of Howard Street, running between the north and south Moscone buildings, and set up a catering tent. Too many people to get them all fed inside, is what the spokesman says.
San Francisco is chuffed to have such a large crowd filling its hotels, restaurants and nightclubs. The weather has been obliging all week, remaining in the toasty 20s. That should help bring many of the visitors back as tourists, as few cities are as dazzling and endearing as San Francisco on a beautiful day. Further down the Bay, Silicon Valley generally is feeling pretty good about itself too, with the strongest consistent quarters of jobs growth since the dotcom crash. The stock markets are also doing very well as is the tech sector generally.
Google's news last week that revenue had risen 70 per cent in the past quarter brings back those 1999 memories. Its performance is extraordinary - unlike so many of the initial dotcoms, it has revenues to match or at least semi-support the hype.
Consider this sequence of numbers over the past year, soberingly provided by the San José Mercury News in a headline story: in the fourth quarter of 2005, Google revenue was up 86 per cent, profits up 82 per cent; first quarter 2006, revenues up 79 per cent, profits up 60 per cent; second quarter 2006, revenues up 77 per cent, profits up 110 per cent; third quarter 2006, revenues up 70 per cent, profits up 92 per cent.
Sheesh, imagine that you consider it a slump when profits are "only" up 60 per cent on the preceding quarter!
Biotechnical companies are also making news here this week - well, not the individual companies so much as the entire sector.
Many in the Valley seem to have been taken by surprise by a new report by PricewaterhouseCoopers and the California Healthcare Institute that shows that the biotech industry is now the second-largest employer in the tech sector, giving 260,000 people jobs and generating $62 billion in revenue last year.
The largest sector, computer programming, employed 304,200, while 188,400 work in aerospace and 168,700 in other computer-sector jobs.
In yet another of those breathtaking statistics that make you realise how California takes the notion of industry "clusters" and turns it upside down, the report notes that California's 2,700-plus biotech firms make up two-thirds of the stock market value of all the biotech companies quoted on the Nasdaq.
