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Oracle Tests Web Hosting Waters

Oracle is betting part of the farm on Web hosting services for other businesses.

The No. 2 software maker Tuesday said it would begin offering its Oracle9i software as an online service and manage the software for customers. The idea is to use its Outsourcing technology to help cut costs and simplify processes.

Similar to its E-Business Suite Outsourcing, the company's Technology Outsourcing uses what it calls a flexible "Any Place" deployment model. Customers will have the option of having the hardware and software hosted and managed in Oracle's secure data center or a secure data center of their choice.

Redwood Shores, Calif.-based Oracle is working with Authorized Network Providers such as Broadwing to provide a secure Virtual Private Network (VPN) between the software giant and the customer's designated data center. In addition, customers can choose to have their systems hosted by third-parties such as BT Ignite, Broadwing, Intel Online Services and Qwest Cyber Solutions, with Oracle software management performed remotely by Oracle.

"Servicing Oracle9i software for our customers is the next step in the evolution of Oracle Support Services from a reactive to proactive organization," said Oracle Product Services and Platform Technologies senior vice president Mike Rocha. "By using our own CRM software and maintaining a continuous network connection with our customers, we are able to proactively monitor, manage and upgrade our products, which dramatically increases system up-time and consequently, customer satisfaction."

Oracle also says it new solution also helps companies focus on IT priorities and install new systems faster. By offloading routine database and application server administration tasks to Oracle, IT departments can focus on more strategic IT priorities such as custom application development or security. Companies can also make use of pre-tuned software and hardware configurations offered through Oracle's certified hardware partners such as Compaq , Sun and Dell .

"Much of the attention in outsourcing has been focused on applications, but the biggest hidden IT cost is the people it takes to manage, maintain and service the technology stack," said Barbara Gomolski, research director at Gartner Group. "By helping companies spend their IT resources on strategic projects instead of routine administration, delivering software as a service can save companies money and help them redeploy existing resources for more strategic tasks."