Oracle Sharpens Asia Strategy with China Dev Center

Oracle (Nasdaq: ORCL) has opened a second business development center on the Chinese mainland and has unveiled a program to help Japanese companies tackle this emerging marketplace.

The company said its second China Development Center (CDC) is now open for business in Beijing, offering China-based companies an opportunity to accelerate their emergence into the worldwide marketplace. The center also will allow Oracle and its customers and partners to work more closely with those emerging firms. Oracle's first such center opened in Shenzhen in June 2002.

Oracle vice president Derek Williams said the new center extends the company's 14-year history of involvement in the country. Oracle will train information technology talent at the center, share knowledge with China-based software firms and enter into joint development agreements when appropriate.

The lab will focus on several key areas, including wireless technology, e-government solutions and location-based services, such as Geographic Information Systems. Linux and other open-source platforms also will be a focus of the center, as will translation and development of products spawned in China for use on the larger global stage.

When both centers are fully staffed, they will employ about 200 software engineers and other workers, according to Oracle.

A Little Help

In a separate announcement, Oracle said it will launch a unit that merges expertise and personnel from its Japan and China subsidiaries to help Japanese firms extend their reach onto the Chinese mainland. As a rationale for the move, Oracle cited Chinese government data showing that some 15,000 Japanese-owned companies have made a foray into China, sinking some US$4.2 billion into various ventures along the way. Only U.S.-based companies have invested more.

Oracle said the unit will serve as a bridge between Japan and China, with software engineers, sales reps and consultants from the two countries working together on IT solutions for companies as they push into China. Those solutions will be based on various Oracle software products that focus on bookkeeping, supply chain management, manufacturing, procurement and customer relationship management (CRM).

Long-Term Thinking

Williams said Japanese firms need the "same level of support and service" they receive in Japan as they seek to operate in the vast and complex Chinese marketplace. According to Oracle, its new business unit will shorten the time required to set up shop in China by leveraging its experiences and those of its customers that already operate in the country.

IDC director Piyush Singh told the E-Commerce Times that while the Asia-Pacific marketplace took a hit over the past year from the SARS epidemic and economic slumps in some key countries, including Japan, virtually every tech company is angling for a piece of the emerging Chinese market.

"Everyone has a different approach, but the companies that are on the ground certainly have a distinct advantage, which is why you're seeing so much investment flood in from the U.S. and elsewhere," he said.

Oracle is just one of many firms that have struck up relationships with the Chinese government in order to put a flag in the ground in what is widely believed to be the economic marketplace of the future. Intel (Nasdaq: INTC) recently announced it plans to invest at least $375 million to build an assembly plant on the mainland, while AMD (NYSE: AMD) and eBay also have made recent investments in China.