Roy Lobo - Investor Relations Safra A. Catz - Co-President, Chief Financial Officer,Director Lawrence J. Ellison - Chief Executive Officer, Director Charles E. Phillips - Co-President, Director

Sarah Friar - Goldman Sachs Jason Maynard - Credit Suisse Peter C. Kuper - Morgan Stanley Heather Bellini - UBS Adam Holt - J.P. Morgan Kirk Materne - Banc of America Securities Israel Hernandez - Lehman Brothers

Good day, everyone and welcome to today’s Oracle Corporation quarterlyconference call. Today’s conference is being recorded. At this time, I wouldlike to introduce Mr. Roy Lobo, Investor Relations of Oracle. Please go ahead,sir.

Thank you, Operator. Good afternoon, everyone and welcome toOracle's second quarter fiscal year 2008 earnings conference call. This is RoyLobo, Head of Investor Relations. With me on the call are Oracle's ChiefExecutive Officer, Larry Ellison; Oracle's President, Charles Phillips; andOracle's President and Chief Financial Officer, Safra Catz. We will begin with a few prepared remarks and then take afew questions from the audience. Let me begin by reading the obligatory safeharbor statement. Today’s discussion may include predictions, estimates, orother information that may be considered forward-looking. While theseforward-looking statements represent our current judgment on what the futureholds, they are subject to risks and uncertainties that could cause actualresults to differ materially. You are cautioned not to place undue reliance onthese forward-looking statements which reflect our opinions only as of the dateof this presentation. Please keep in mind that we are not obligating ourselves torevise or publicly release the results of any revisions of theseforward-looking statements in light of new information or future events. Throughout today’s discussion, we’ll attempt to present someimportant factors relating to our business that may affect our predictions. Youshould also review our most recent Form 10-K and 10-Q for a complete discussionof these factors and other risks that may affect our future results or themarket price of our stock. A PDF copy of our press release and financial tables, whichinclude a GAAP to non-GAAP reconciliation, can be viewed and downloaded on theOracle investor relations website, www.oracle.com/investor. So with that, I would like to turn the call over to SafraCatz for her opening comments. Safra A. Catz: Thanks, Roy. Good afternoon, everyone and thanks for joiningus. I am going to first focus on our non-GAAP results for the quarter, thenI’ll review guidance for Q3 and turn the call over to Larry and Charles fortheir comments. Well, obviously we had another great quarter and we’ve againachieved our fastest growth rates in more than a decade, with new licensegrowth of 38%. We are growing revenues, margins, net income, and earnings wellahead of our peers. The strength of our results really comes down to the factthat we are selling more product to more customers in more industries. Ourlarger, standard based software portfolio means we are seeing more deals and eachdeal is a little bigger than in the past. Q2 was really a function of execution. We exceeded our ownexpectations in all regions and across all product lines. The quarter wasbroadly distributed and wasn’t dependent on any unusually large deals. Now, before I go through the numbers, I also want tohighlight that we are continuing to grow the top line and the bottom line atthe same time. We are extremely pleased with our ability to improve margins inthe quarter while also accelerating new license growth. This is really afunction of our scale and our ever-growing customer base. With that, let me go through the numbers. New softwarelicense revenues were up 38% to $1.7 billion. Technology new license revenueswere exceptionally strong, growing 28% year over year to $1.1 billion, withdatabase growing 19%. We are beating the competition and taking market shareaway from our competitors. We grew technology license revenue 32% in the Americas, 23%in EMEA, and 32% in APAC. Our applications business was also strong, with new licensegrowth of 63% year over year to $553 million. Geographically, we turned in a strong performance across allregions, with 57% in the Americas, 72% in EME, and 66% in APAC. Hyperion contributed $71 million in license revenue duringthe quarter. Software license updates and product support revenues were up 23%on a non-GAAP basis to $2.5 billion and we are on a revenue run-rate to achieveover $10 billion in FY08. In addition to delivering strong revenues, we are also deliveringstrong operating income and margin. Our non-GAAP operating income grew to $2.2billion with our margins increasing 250 basis points to 41.3%, up from 38.8% inQ2 of last year. EPS grew 40% to $0.31 on a non-GAAP basis, excluding ourstock option expenses. Operating cash flows for the trailing 12 monthsincreased $2.3 billion year over year to $7 billion, while free cash flowincreased 50%. In Q2, we bought back approximately 23 million shares at anaverage price of $21.12, and as we said, the rate of our buy-back willfluctuate from quarter to quarter, taking into account our alternative andanticipated uses of cash. The currency impact for the quarter was a positive $0.07 onrevenue and nine points -- sorry, seven points on revenue and nine points onoperating income. Before I turn to guidance, let me say again that we read thesame newspapers you do and we take those reports into account when we thinkabout the business. However, we were able to deliver exceptional Q1 resultsduring August when the macro and sub-prime concerns began and the marketdropped 1,000 points, and we were able to deliver exceptional results againthis quarter as those same concerns continued. We have a broad, highly diversified customer base, both byindustry and geography, and as a net exporter, we benefit from the weakerdollar, so our guidance for Q3 is as follows: new software license revenues areexpected to be up 15% to 25% year over year; total revenue is expected to be up20% to 23% year over year on a non-GAAP basis; total revenue on a GAAP basis isexpected to be up 21% to 24%; non-GAAP EPS excluding stock-based comp isexpected to be $0.29 or $0.30, as compared to $0.25 last year; GAAP EPS for thesecond quarter is expected to be $0.23 to $0.25, up from $0.20 last year. This guidance assumes a tax rate of 28.8 for Q3 versus 26.4in Q3 of last year. Now, if current exchange rates hold for the entire year,for the entire quarter, that will result in six points of positive currencyimpact for Q3. But as you know, currencies are likely to fluctuate and as aresult, the currency impact in Q3 could be different than our guidance assumes. Finally, I’d like to give you a quick update on BEA. Overthe last few weeks, we’ve been in contact with their bankers and lawyers and asa result of those discussions we’ve concluded that no friendly deal can be donewith the current BEA board at a price and term acceptable to Oracle. With that, I’ll turn the call over to Larry for hiscomments. Lawrence J. Ellison: Thanks, Safra. We had a very, very strong quarter from aproduct perspective. We gained market share in all of our three major productareas against our primary competitors. In the database market, our largest and most mature product,our database business grew 19% in the quarter, dramatically higher than thegrowth of the overall market and considerably faster than IBM’s DB2 growth, sowe continue to take share in the database market and grow that business. Wecontinue to extend our lead over the number two player, IBM. In middleware, our middleware business grew 80% in thequarter. It was our fastest growing business and there, our two majorcompetitors in middleware are Microsoft and IBM. It’s a little hard to figureout how big Microsoft is and whether their business is growing or how fasttheir business is growing because Microsoft bundles their middleware withWindows, and their middleware is not based on industry standards. But they are,as far as we can tell on our own studies, they are the number one player. The number two player in middleware is IBM and like Oracle,IBM sells middleware based on Java and other industry standards and we continueto gain share against IBM. Again, our middleware growth, 80% in the quarter,very, very exciting. Finally, in applications, where our primary competitor isSAP, we grew at 63% versus their reported growth -- their reported growth indollars. We convert back to dollars. I believe their Euro growth was 11% buttheir dollar growth was 15%. Double-check those numbers but I do believe that’scorrect, and we were 63%. So we are growing our applications business very muchfaster than SAP and we think that’s a result of our strategy differences. SAP has elected to stick with ERP and build an all-new ERPsystem to sell to small businesses. They call that Business By Design. We’veelected not to go into the small business market because we don’t see anysynergy with our existing business, which sells to medium and large scalebusinesses. So our existing businesses -- our existing customers tend tobe large companies or medium/large companies. If we were to go and sell it tosmall business, it’s a new set of customers requiring a new sales forcerequiring a new product. There is just no leverage, no synergy -- it’s a businessthat we don’t think is right for Oracle. Instead, what we think we should be doing and what we aredoing is selling, is moving beyond ERP and selling industry-specificapplications to the same customers that we sell database to, the same customerswe sell middleware to, the same customers we sell ERP to, the same customers wesell CRM to, we are now selling industry-specific solutions in banking, intelecommunications, in retail, in government in the tax area, in utilities, inhealthcare, in education and other -- and you’ll see us going into more andmore industries. That’s our strategy for growth, to go beyond ERP, sellindustry-specific applications to the customers we sell other things to. We think it allows us to leverage our relationships, leverageour support, leverage our existing products via cross-selling and is a moreprofitable business at the high end rather than the low end. We think this is already paying big dividends and as you seeonce again we turned in a pretty respectable quarter in terms of our growthcompared with SAP. With that, Charles will get much more specific and tell youabout some pretty spectacular customer wins we’ve had in the quarter. Charles E. Phillips: Great. Thanks, Larry. Well, we really had great focus andexecution in all regions and lines of business, and just fantastic teamwork onthese large deals that tend to cut across multiple product groups and salesorganizations, but we’ve learned how to manage that and take advantage of ourstrength. In particular, some great performances, North America, our largestsales organization, did a great job optimizing cross-sell across acquiredproducts and increasing margins at the same time. Communications global business unit, huge upside in thequarter. They are really becoming a gold standard for telcos, since we are theonly company with an end-to-end footprint from order capture to provisioning tobilling. APAC and LAD recovered from a slow Q1 and beat theirforecast in double-digit revenues, just great execution. Let me make a few comments by product area. On database,we’ve gotten a fantastic response from customers and analysts [inaudible] over479 new features. We’ve had over 170,000 downloads since we introduced theproduct in August. So during the quarter, we continued with the release of theproduct and expanded it to more operating systems. We now support all the majoroperating systems. In addition, we’ve certified 11G with PeopleSoft, Siebel,and [JD Edwards]. We expect EBS12 to be certified by the end of January. Moving on to middleware, we have some great customer wins Iwanted to talk about just for a moment. For instance, we are using our SOA platformas a wedge strategy to go into new accounts that perhaps where a competitiveapplication server is already installed, but because we have a new shelf andbetter products and the emerging technologies we are able to sell around thoseproducts and over time they become Oracle accounts. Let me give you a fewexamples. Raytheon -- they are using NetWeaver as an applicationserver but they use our SOA platform this quarter to automate manual approvalprocesses. [inaudible] -- using BEA middleware for application server,which shows Oracle [built-in] workflow for 1.5 million retirement employees andthey are also using our content management. They will buy more Oracle. China Mobile, a BEA customer, chose us for integration.Hyundai Motors was using IBM and SAP. They moved to us for SOA for their futureneeds. We also had a real nice win in content management server[inaudible]. That’s a very strong business for us. So one organization you’llall recognize, the SEC selected our content management system [Stellent]product to manage financial filings and documentations for 10-Ks, 10-Qs, etcetera. Other areas that did very well are middleware, enterpriseperformance management -- that’s the Hyperion product. Some great wins thereand that’s been a product that’s been key to getting into many, many SAPaccounts and we continue to do that, so one of the top three U.K. banks in theworld using SAP for financials chose us to consolidate those financials and nowwe have a strong relationship in the CFO’s office. One of the top two German banks, the same thing happened.SAP back-end, as you might expect, but corporate wide financial consolidationchose Oracle. So all these accounts are becoming SAP and Oracle shops, notjust SAP anymore. So there’s no such thing as an SAP account to us, anyway. In the areas of applications, continued momentum, as Larrydescribed. We had 365 direct wins over SAP in the quarter, the ones that wecould count. We probably had more. A few examples -- CellGen Corp., a lifesciences industry, which used to be a strong industry for them, they selectedus over SAP this quarter. One of the top banks in China, one of the big four,one of the four state-owned banks, we beat SAP there. Korean Airlines, the samething. We also had a nice win in Hellmann Worldwide, which is thelargest privately owned logistics company in the world, happen to beheadquartered in Germany -- nice win for us around G-log. In the retail vertical, Morrisons, which is the U.K.’sfourth largest super market, this is a prototype footprint deal. They boughteverything from merchandising, planning, store activities, HR, finance,[inaudible], middleware, database -- that’s the type of deal that we like, oneof the important retail deals in the quarter and a good job by the RGBU. In banking with iFlex, they had some great wins also. ChinaTrust Commercial Bank, the largest bank in Taiwan in terms of revenues; MDMBank in Russia, all those banks are going to need new systems. It’s one of thetop 10 banks. They’ve selected iFlex for getting the localization done whichwill help us in the next [ten] deals. And the National Bank of Egypt, thelargest bank there. And in telco, I mentioned a great performance there, bigdeals at France Telecom and China Netcom, replacing AMDOCS. In our tax and utilities business, our global business unitthere, where we sell time and meter data management and field service, greatwins at [Buchane] Light Company, Cleveland Water District, San Francisco PublicUtility Commission, all over SAP. So in summary, we are pleased with the execution in Q2 andwe think we are well-positioned as we go into Q3, so we all feel pretty good. Questions.

Thank you very much. I think with that, we’d like to open upthe line for questions but before I do that, let me just remind the analysts,please limit their questions to one question so we can hear from all ouranalysts. Operator.

(Operator Instructions) We’ll take our first question fromSarah Friar with Goldman Sachs. Sarah Friar - GoldmanSachs: Good afternoon, everyone. Great quarter. Safra, on themargin side, if I take a look at your guidance and by midpoint of the top lineguidance and then the margins that you did this quarter, that amazing 41.3, I’dactually end up a little bit ahead of you on an EPS perspective. So I’m justwondering, is there anything inherently about the third quarter that shouldincrease operating expenses or are you leaving yourself a little bit of roomthere? Safra A. Catz: No, there’s nothing particularly different about Q3 than Q2. Sarah Friar - GoldmanSachs: Okay, and then generally, I think last quarter you talkedabout 100 to 200 bps improvement for the year. Is that still the type of liftthat we should be expecting as we look through ’08? Safra A. Catz: Well, I think you can see we are on track for that, so Idon’t see why not. Sarah Friar - GoldmanSachs: Terrific, and then one other quick one -- Roy, apologies --just on the application side. There’s obviously concern out there about themacro environment for ’08 and on the app side, people associate bigger dealsizes with areas that could get hit in a downturn. How do you think about howresilient your apps business is if we see a slightly tougher macro environmentand how do you think about verticals of real strength that you can go to in’08? Safra A. Catz: I don’t know if I or Charles should get that. I mean, thereality is that we are so broadly diversified now, Sarah. We are diversifiedgeographically, as you heard. Charles went through a whole bunch of banks justnow around the world picking Oracle, so the reality is that by product line, weare incredibly diversified. Many of our customers do not own the broad, all ofour entire footprint. Many of them are interested now that it’s part ofOracle's footprint in buying some of these things, so in general we feel rathergood all around. Larry, maybe you have something to add to that. Lawrence J. Ellison: Yeah, I think while it’s possible to defer an ERPimplementation for a couple of years, because you are really changing youraccounting back office, and that’s something that is to some degreediscretionary and if you wait a couple of years, it’s not a big deal. If you are trying to comply with the Basel II laws where wehave to put in the money laundering system or a network provisioning systembecause you are moving to VOIP Internet protocol, some of these otherapplications are not so easily deferred. It’s core to the business. I think one of the reasons we feel good about ourapplications business is it’s a diversified applications business now. It’s notjust ERP. It’s not just accounting or human resources. The bigtelecommunications companies when, as they move and offer new services, newproducts to their customers, voice-over-Internet-protocol, those kinds ofthings, they have to put in these new systems that we offer and right now ourhottest vertical area is telecommunications as they modernize their software tooffer this new generation of products. I don’t think those companies can defer that for a year ortwo, like ERP. That’s why the beyond ERP strategy I think is a more resilientstrategy during a downturn than let’s say our friends in Germany. Charles E. Phillips: The sub-prime issue is in the news a lot in the U.S. butit’s a big market, hundreds of banks around the world and there are lots ofthem outside of the U.S. that we are involved in, and so we are prettydiversified and obviously we are watching it for the ones that have thoseissues. But I just think it’s a bigger market than perhaps people recognize.

And we’ll take our next question form Jason Maynard withCredit Suisse. Jason Maynard -Credit Suisse: Good afternoon, guys. I guess after that question, it’s kindof silly to ask how you are feeling about your strategy relative to thecompetition, so maybe I can drill in on the question around these verticalmarkets. Just in that context of being diversified, how much runway do youthink you have left within some of these vertical markets? Where are you at andmaybe some color on what you are seeing in terms of the pull through withdatabase and the middleware products? Charles E. Phillips: We think we are very early on in this whole strategy, evenfor the verticals we are already in, not to mention for the ones that we planto get into. But the ones that we are in, in terms of the product portfoliothat we have, the ability to go in with a full footprint, these companiesdidn’t buy that way. We are still selling in the verticals who are buildingapplications so we just need to get them to start thinking buying packagedapplications. So we have substantial opportunity ahead of us. Lawrence J. Ellison: Let me chime in again. To some degree, I wouldn’t call it --ERP is a fairly mature business. I wouldn’t call it saturated quite but it’s avery mature business. Most of the companies made an ERP decision. But if youlook at telecommunications companies, they haven’t modernized their networkpositioning, or their billing. We’re replacing older AMDOC systems. If you look at some of the banking companies, they are stillrunning on mainframes. They have very old systems, so where ERP is a mature,nearly saturated business, some of these verticals are almost greenfields interms of modern software. They are running on ancient things that are oftenhomegrown, often run on mainframes and it’s just a huge opportunity. Also again, these are strategic applications. This is thecore of their business. It is not just doing accounting or paying theiremployees. This is actually someone will be able to log on and get a broadbandline and get a cellular telephone line and get that automatically provisionedinteractively over the Internet and to be able to then turn that service on,that VOIP service on or that cellular telephone service on completelyautomatically. The phone companies are doing that and they are using oursoftware to do that. Safra A. Catz: Jason, you also hit on a very, very major point, which weare one of the few companies that actually benefits, and that is in the verynatural pull through of our technology when these products sell. The verticalstrategy allows us to pull through other applications, as well as middlewareand database and that’s obviously showing up in the numbers also, and in dealsizes. Jason Maynard -Credit Suisse: Okay, real quick on this BEA situation, and I apologize formaybe a basic question here, but help me out there -- with the $17 proposal, Idon’t quite understand why there can’t be a friendly transaction with thecurrent board. What’s the backdrop on that situation? Safra A. Catz: You know, Jason, you’d really have to ask them. We’ve beenout there with our offer and it does not seem like that is possible with thiscurrent board.

Thank you, Jason, and just let me remind everyone, pleaselimit your questions to one question.

We’ll go next to Peter Kuper with Morgan Stanley. Peter C. Kuper -Morgan Stanley: All right, I’ll keep everybody honest here, one question --Charles, in your comments, you mentioned SOA a number of times here andcertainly SAP wins, I believe you said 365 direct wins over SAP, if I got thatright. So clearly [inaudible] strategy is working. Is the SOA push here, areyou seeing weakness from the NetWeaver adoption or is it just more of abroad-based, SOA kind of a next let’s say anchor point for you guys to keepchipping away at SAP’s market share? Charles E. Phillips: Well, I’d say most of the customers are already convincedabout SOA as a platform and as an architecture, so we don’t have to evangelizeanymore. Unless they make that decision, there’s not much out there in terms of-- in our class of quality and breadth of product, so SAP really has nothing.That’s why we can sell so easily into their accounts. They have a core appserver and -- that’s a compromised app server -- and what we provide is socurrent, it’s standard and proven by many third parties, that we walk in with alot of credibility. So it’s given us another reason to go back and talk to SAPcustomers. Peter C. Kuper -Morgan Stanley: Okay, as part of that, development of SOA platform, I mean,we had some [little bit of turnover] in management ranks. Tom Kurian did agreat job on his side. Are you guys feeling good about Fusion’s developmenttrack at this point? Lawrence J. Ellison: Yeah, absolutely.

Thank you. Next question, Operator.

We’ll go to Heather Bellini with UBS. Heather Bellini - UBS: Congratulations on the quarter. I had just a follow-up onSarah’s margin question, talking about the 100 to 200 basis points for this year.I heard what you said but looking out to next year, I mean, you reallyaccelerated and are showing the scale and the leverage of the model this year.I’m wondering if you could give us an idea of is that 50% target that Safra,you’ve talked about for the past few years, is that still something that weshould expect to see and over what timeframe? And then my follow-up would be, looking out to the pipeline,you made comments about the size of it before. I was just wondering, given thecurrent macro environment, could you comment on it now and also tell us if youare assuming lower close rate assumptions than what you were using for theNovember quarter? Thanks. Safra A. Catz: Now, Heather, that was really cute. You were able to stickin three questions. Heather Bellini - UBS: I tried. Safra A. Catz: Okay, let’s see if I can remember them. It was Larry thatcame up with the 50% target and you know, it remains out there in our future.It’s of course very dependent on our level of investment and our growth rate.So for us, profitability has always been very, very important. We’ve come along way from the 20%, 22% we were in the late 90s, so we are now in the --obviously in the 40s for the year. And you know, it is ultimately achievable --it’s just very dependent on an awful lot of things. The -- jeepers, what was your second one? Heather Bellini - UBS: The comment, if you could comment about the size of thepipeline and the closing -- Safra A. Catz: The pipeline, sure. The pipelines remain very strong. As youknow, I always assume lower closure rates for the next quarter than the yearbefore and this existing quarter. Clearly this past quarter, once again closurerates were high and above average, above the average of the last six or sevenyears. That does seem to be a trend but in our forecasts, we can’t assume thatand though the pipelines are large, very large, and continue to grow, it allreally comes down to getting those deals closed and we won’t know that forquite a while. There was a third one. What was that? Or did we cover itall?

We’ll get our next question with Adam Holt with J.P. Morgan. Adam Holt - J.P.Morgan: Good afternoon and happy holidays to everyone. I had aquestion about the database growth, the 19%. Charles, as I believe youmentioned, you’ve obviously just started to or fully certified 11G on yourapplication set and across platforms. Could you maybe give a little bit ofdetail of what was behind the acceleration in that business, particularly inNorth America? And then I guess the second part of the question would bethe comps get a little bit more difficult there heading into the back half ofthe year. What should we be thinking about in terms of sustainable growth onthe database side? Charles E. Phillips: Well, I didn’t mention the options but as you know, wecontinue to add new categories of options with each release and some of the newones that we released last year, like audit log and database log, are doingextremely well. And I think particularly in North America, they have gottengood at focusing on those options and they are having people who specialize inselling add-ons around the database, and so that is a strategy that has workedwell and they are all unique, these options that we come up with. And I also think just the announcement of 11G, it helped, itkind of refocused people on the core database and they saw the innovationthere. That certainly couldn’t hurt us going forward. Lawrence J. Ellison: I think our database will continue to grow in double-digits.We should grow -- if the overall database market in the world is growing athigh single digits, we should certainly grow faster than the market.

We’ll go now to Kirk Materne with Banc of AmericaSecurities. Kirk Materne - Bancof America Securities: Thanks very much. Just a question on the growth in themiddleware segment. Obviously that’s a segment of technology that’s been sortof lagging recently and I was just curious in terms of what, if there was aproduct in there that’s been sort of a leading indicator for you all in termsof a piece of technology that’s helping you capture customers and thenobviously I assume you are surrounding that product with other features and thevertical applications, but just when you look at that business, is there apiece of functionality that you believe you guys are well ahead of that’sbringing more and more customers to the platform or is it just the entire suiteof offerings you have there? Lawrence J. Ellison: Actually, I read the same articles you have in thenewspaper. This is about the slowing adoption of SOA, and while I’ve read that,people have to understand when you have a fundamentally new computer softwarearchitecture, SOA, it takes a long time for adoption. This is not somethingsomeone flips a switch and everyone moves to SOA. It takes about 10 to 20 yearsto rewrite all of your applications. So that always was going to be a slow process. However, wesee that process accelerating, at least in our middleware business. We thinkit’s a long-term growth story. It’s a very rapid growth story. We think it’sincreasing so we have a SOA suite and in security, we have a single sign-onproduct. We have business intelligence products, balanced scorecard products,real-time measurement products. We have a variety of different components well beyond just aJava server, a JVM and a Java container. So we have a complete and integratedsuite but we see all of those businesses growing. I mean, 80% growth on apretty big number, you have to hit on all the cylinders. So we see ourmiddleware business doing extremely well, though understand it will take a verylong time for our customers but we think that’s good news. It’s a long time forour customers to have a majority of their applications modernized, that wethink this is a growth story for a decade for us. Charles E. Phillips: I think the other thing we’ve done well is finally get theISPs on board, went back to some of the database partners and now we have over5,000 ISPs who’ve adopted our middleware and that’s a pull through for us. And then I think the second issue is Thomas Kurian has donea great job in terms of making the upgrade process easy, so we have somethinglike 90% of the installed base on the last two releases of the platform andthat allows us to continue to upgrade them and sell the add-ons.

Thank you, Operator. We have time for one more question.

We’ll take our last question from Israel Hernandez withLehman Brothers. Israel Hernandez -Lehman Brothers: Good afternoon, everyone. Our checks our pointing to somesignificant pipeline build across the state and local government vertical, aswell as higher ed. I was wondering if you could comment on what type ofmomentum you are seeing out there in those markets and do you see them as beingmeaningful drivers of business here over the next few quarters. Charles E. Phillips: That is an area of strength for us. We’ve always been verystrong in state and local government, and so has PeopleSoft. I think with theacquisition of SPL, which is now our utilities business unit, which is oftensold to those same customers, through our strategy of getting stronger where weare already strong to begin with, this has been very helpful for us. So wecontinue to round out the footprint. A lot of the products that we bought aredefinitely applicable in that same vertical, so yes, we are doing well there.

And that does conclude the question-and-answer sessiontoday. I’d like to turn it back to management for any additional or closingremarks.

Great. Well, thank you, everyone, for participating intoday’s call. A telephone replay will be available for 24 hours. The replaynumber is 719-457-0820, and the passcode is 1781234. You can also access thewebcast replay on the Oracle investor relations website. The webcast replaywill be available through the close of the market on December 26th. Thank youand with that, I’ll turn the call back to the Operator for closing.

Ladies and gentlemen, that does conclude today’s conference.Thank you for your participation. You may now disconnect.