Gates, Ellison, spar over future of online world, Internet competition. (Bill Gates, Microsoft Corp.; Larry Ellison, Oracle Corp.)

Gates Pledges Wallet PC For $500

The chairmen of Microsoft and Oracle Corp. jousted over the future of PCs and the online world at the European IT Forum 1995 in Paris. Microsoft's Bill Gates and Oracle Corp.'s Larry Ellison offered competing visions of how today's computer companies will compete in tomorrow's consumer market.

The Internet is moving the industry away from a desktop-based to a network-based view of computing, Ellison told the meeting sponsored by market-research company International Data Corp.

Ellison demonstrated Oracle's upcoming Web server and browser software, and said his company has the upper hand in delivering multimedia on the Internet because Oracle is already focused on database technology. "Oracle does one thing, and one thing only, very well -- we deliver vast amounts of data to users," he said.

Oracle's browser, which is Netscape-compatible and slated for release in November, has the Java language built-in and allows users to download video and executable programs from the Internet and other networks.

"The MicrosoftNetwork is probably the last of the online services to be built on the Club Med model: come on in and you're safe," said Ellison. "The Internet model is a little riskier but richer culturally."

In the future, software, applications and content will reside on networks, and users will have simple $400-$500 terminals in their homes Ellison dubbed "Internet appliances."

But Gates disagreed, arguing that PCs will not turn into dumb terminals, but will need intelligence and storage capacity. "You'll find that the PC will take on new forms: wallet PCs will be carried around end you'll see kiosk PCs and portable PCs that will all be hooked up into a unified network that provides a rich set of applications," he said.

Over the next year, Microsoft will work with a major vendor to develop a wallet-sized wireless-capable PC to retail at a price of about $500, Gates said. Microsoft is also working with telecommunications companies to develop telecom infrastructure so the cost of communications, apart from data and content, will be "almost free," Gates said.