Updating an Annotation feature class, such as updating an attribute column value, stored using ATTRIBUTE_BINARY=BLOB and GEOMETRY_STORAGE=SDO_GEOMETRY results in a Network I/O error.
This is a known issue.
** This issue has been addressed in ArcSDE 9.0 Service Pack 3 (SP3)
Click on the link in Related Information below to download the Service Pack, if necessary. **