SAN FRANCISCO - Some habits die hard. For Larry Ellison, starting companies that build network computers is one of them.
The colorful chairman and CEO of Oracle (ORCL) helped to launch a new, independent venture today called New Internet Computer. Funded by Ellison, the firm will sell a $199 "non-PC" device called the "new Internet computer" that has no hard drive, doesn't run Windows and provides access to e-mail and the Internet.
The first NIC will be targeted at educators and will provide students with a more affordable alternative to the PC for accessing the Internet and e-mail, said Gina Smith, a former technology journalist who was enlisted by Ellison late last year to be the company's CEO.
"We're not positioning this as a replacement for the PC," Smith said in an interview this morning. "Schools will still use PCs, but they don't have enough of them, and the cost of maintaining them is very high."
At the end of the year, "The NIC," as Smith likes to call her company, will offer a version of its Internet computer targeted at consumers. The consumer version also will be priced below $200 and will serve primarily as a way to access e-mail and the Internet.
If Ellison's plan to launch a network-computer company sounds familiar, it should. Back in 1995, the Oracle chief was one of the original advocates of the "network computer," a device he predicted would displace PCs by offering a more affordable and efficient way for accessing the Internet.
Ellison created Network Computer Inc., an Oracle subsidiary with a mission to evangelize its concept and provide software for its devices, but the network computer never took off as Ellison and other advocates had predicted. In 1999, NCI changed its name to Liberate Technologies (LBRT) and switched its focus to software for interactive television, launching a successful IPO.
The new company launched today won't be a rerun of NCI, Smith said.
"Everything's different," she said.
The original NCs used a proprietary-operating system and had to be used in conjunction with a server that hosted its software applications, she said. NICs, by contrast, run on the Linux operating system and come installed with a 56Kbps modem and Web browser from Netscape Communications, which is all they need for accessing the Web, Smith said.
"In many ways, they're more akin to the Internet appliances that you see being introduced" from companies like Compaq and Gateway (GTW) 2000, she said.
The NIC's software programs are stored on a CD housed inside the computer, along with several browser plug-ins for running Macromedia (dossier)'s Shockwave, RealNetworks (RNWK)'s RealAudio and other Internet downloads. The CD can be taken out and replaced by a network administrator, allowing NICC to upgrade the software in the machines as it sees fit.
For educators who want more than basic Web browsing and e-mail, the CD also contains client software from Citrix Systems (CTXS) that will allow the NIC to run server-based versions of some Windows applications, such as Microsoft (MSFT) Word, if they want to, Smith said.
The first 1,000 NICs are in the process of being installed at a school in Dallas for no charge as part of a philanthropic program at Oracle. Other educators in the United States, Latin America and Europe can order the machines for purchase immediately, she said. The NICs are being manufactured by a Taiwanese firm that Smith declined to identify.
Apart from starting a computer magazine many years ago, Smith said she's had no prior experience running a company. She said her work as a computer journalist has taught her what users want from a computer and what they find most difficult to deal with.
She became acquainted with Ellison by conducting interviews with him over the course of several years. When Ellison introduced the first network-computer concept in the mid-1990s, "I told him I thought
