NEW YORK -- At a gathering here Tuesday of current and potential Oracle ISV (independent software vendor) partners, Oracle Chairman and Chief Executive Officer Larry Ellison extolled the virtues of Linux and predicted that the open-source operating system will soon decimate Microsoft in the battle for the data center market.

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"(Microsoft has) already been killed by one open-source product. Slaughtered, wiped out, taken from market dominance to irrelevance," Ellison said, speaking of the Apache Web server's displacement of Microsoft's IIS (Internet Information Services) technology. "They had a virtual monopoly on Web servers, and then they were wiped off the face of the earth. And it's going to happen to them again on Linux."

Ellison's version of Web server history is a bit shaky, though, according to research and services company Netcraft. The company's survey of Web server market share shows Apache already heading toward a leading market position by the time IIS appeared on the field in 1996. Although IIS is currently the No. 2 Web server technology, behind Apache, it never gained more than a 35 percent market share, according to Netcraft, which tracks IIS's current market share at about 30 percent.

Ellison's characteristically dramatic predictions came during a showcase event following Oracle's announcement last week of new efforts to spur ISV adoption of Linux. Tuesday's gathering featured several customers discussing their experiences with projects involving Oracle technology deployed on Linux, and a panel discussion among Oracle partner ISVs working on Linux support.

Ellison concluded the session with a few brief remarks about the speed, cost and flexibility advantages Linux offers over proprietary systems, then invited questions. A query about his view on Linux's future, especially on the desktop, prompted his dire predictions about what the open-source movement will do to key rival Microsoft.

While Windows gets all the attention, the Office suite is Microsoft's real monopoly, and once a viable Office alternative is available for Linux, "all hell will break loose," Ellison said.

Ellison deemed the Sun Microsystems Inc.-backed OpenOffice.org suite "almost usable," and predicted that as such software becomes more robust, Linux will begin making inroads into the desktop market in price-sensitive regions such as China and India .

"It will take many years, but (Microsoft) will eventually have to compete. It'll be a whole new world for them. I'm looking forward to it," Ellison said.

He also addressed the utility computing model being championed now by several major vendors, most notably IBM, which is heavily promoting its "on-demand computing" vision.

Vendors are correct to focus on offering customers simpler ways to handle their IT infrastructure, but too much emphasis is placed on hosted offerings, Ellison said. What should matter for customers isn't whether their servers are located in their own data center or in a vendor's; the real advantages of a utility, IT-as-a-service model is that it shifts the burden of installing and maintaining complex systems away from customers and toward their technology providers, who specialize in such matters, Ellison said.

The advantages of a one-size-fits-most, mass-production IT model and of labor specialization should have been obvious to IT buyers long ago, he said.

"The computer industry is finally moving from a cottage industry to an industrial industry. We're moving at breakneck pace toward the 19th century," Ellison quipped.

One potential Oracle partner attending the event said that message resonated with him.

"Larry has great clarity of thought," said Mark Hayward, president of Mark Hayward, a Mountain Lakes , New Jersey , software development and consulting firm. "His comments about the value of expertise and the economics of scale were interesting. It's a very good insight that I think has gotten lost."

Hayward said he came to the event at Oracle's urging. His company recently finished a $10-million, Oracle-based custom development project for a financial company, through which he built ties with Oracle. Now Hayward 's organization is focusing on developing and selling several standalone software products.

The company's first product, a collaboration and knowledge management system aimed at law firms and legal departments, isn't a good candidate for a Linux port because the legal industry remains heavily dependant on Microsoft technology, Hayward said. But he's considering Linux for use in the company's current project, a point-of-sale (POS) system for magazine retailers.

The system is being designed in conjunction with a client and will then be packaged for sale to other organizations, Hayward said.

"We'll definitely be evaluating Linux for parts of the POS system," he said. "It makes sense for retail."