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June 13, 2003
Are Open Source Databases Following in Linux' Footsteps?
By Clint Boulton
FEATURE At a partnership announcement with Dell Computer in New York City back in April, Oracle (Quote, Company Info)
CEO Larry Ellison stood alongside his fellow CEO Michael Dell and discussed
how the Linux open source operating system was stealing market share from
Microsoft's Windows products. In
the future, he asserted, Microsoft would be all but irrelevant by the Linux
trend. The crowd nodded and smiled at his screed. This, you could almost
hear them thinking, was Larry at his best.
But then someone
in the audience took the flipside to his thesis, asking Ellison: If Linux,
in all of its open-source glory, would irreparably harm Microsoft's proprietary
approach, could he not see the threat of open-source database vendors to
his company? Ellison said no, and then enumerated Oracle's market strength,
brand, track record and high level of security as reasons for Oracle's staying
power.
Few can dispute
those points. Oracle, which specializes in selling to high-end customers,
is still a $10 billion company at the top of the database market. In the
most recent calculations
from research firm Gartner, Oracle retained a whopping 43 percent of the
overall relational database market. IBM and Microsoft, which also cater to
small and mid-sized businesses with their database products, are the other
two most successful vendors in the vaunted space, with shares of 24 and 17
percent, respectively. It should be noted that IBM, which bumps heads with
Oracle often in the quest for large customer contracts, has posted impressive
gains in the database sector, and led during the last quarter in terms of
new, licensed users.
But while commercial
database vendors remain locked in a lunge and parry fight for customers,
in the background is a small movement in which providers are open-sourcing
their database as a less expensive alternative to the ingrained vendors.
This open-source movement, which some experts predict will follow a similar
arc to Linux, is led by a Swedish firm that has been quietly building momentum
as an alternative in the market for small business, departmental or commodity
use: MySQL. Industry
opinion is divided as to whether MySQL or another of its ilk might challenge
Oracle, Microsoft or IBM at the low end of the database market, where fewer
specialty features are needed.
IDC analyst
Carl Olofson summed up open-source databases technology: "Open source relational
database management system (RDBMS) software is a disruptive technology. As
such, it is used, not to address the high end requirements of those who demand
the latest and greatest, but to address the needs of application and tools
developers and vendors who are looking for just enough database technology
to provide an affordable solution."
This is certainly
comparable to Linux, which has enjoyed growth propelled by many major vendors,
such as IBM and Oracle, as well as myriad Linux providers like Red Hat and
SCO. These firms have pumped many dollars and resources into the movement
to provide an alternative to proprietary systems such as Unix and Microsoft's
Windows operating system. Isn't it imaginable, therefore, that open-source
databases might follow the same path? After all, Linux started as a small
movement, too.
MySQL's value proposition is (contrary to Oracle, Microsoft or IBM) to
provide the code for its MySQL database for free, under the free
software/open source GNU
General Public License (GPL) or a non-GPL commercial license, which they make money from through service fees. And it's working.
In the spirit
of "If you build it, they will come," MySQL has been building and users have
been coming: MySQL has seen an estimated 4 million installations and over
30,000 downloads per day for its flagship product. The company counts Yahoo!,
Lucent Technologies, Sony Pictures Digital Entertainment among its customers.
At a time when investor dollars are scant, the firm this month landed $19.5
million in funding, led by Benchmark Capital, and appointed one Benchmark
general partner Kevin Harvey to its board.
MySQL versus the big three
Impressive credentials
and support? Perhaps. But why go to an open-source database when Oracle 9i,
Microsoft SQL Server and IBM DB2 are held in such high regard? In short,
for the same reason why businesses are moving to Linux platforms: to save
on total-cost-of-ownership, among other areas. The importance of this cannot
be understated in this weak economy. Gone are the days when CEOs we're looking
to pad the top line; here are the days where the CEOS scrutinize how much
cash they can shave off the bottom line.
So, consider
a few options from Oracle, Microsoft and IBM. Oracle offers two main packages,
an enterprise edition geared for high-end use at $40,000 per processor and
a standard edition for $15,000 per processor, which is targeted for small-
and medium-sized businesses (SMBs). Similarly, Microsoft has a standard edition
of SQL server for $4,999 per processor, and an enterprise-class offering
for $19,999 per processor. IBM's DB2 portfolio features an enterprise edition
for $25,000 per processors, and a workgroup edition for $7,500 per processor
(comparable to Oracle and Microsoft's standard editions).
By contrast,
MySQL offers its database on a much lower scale and cost to the casual user.
MySQL CEO Marten Mickos discussed his company's value proposition and licensing
model in a recent interview.
"We are what
we call a 'second wave open source' company, meaning we have a functioning
business model that is in harmony with our free software principles," Mickos
said. "Our dual licensing allows us to offer our software free of charge
under the GNU General Public License (GPL) while at the same time selling
the same product under a regular commercial license. We can do this because
we own our software and have the freedom to license it any way we wish."
Olofson explained where open-source database technologies, such as those provided by MySQL, and two of its brethren, PostgreSQL and Firebird, fit into the market.
"Although the huge majority of MySQL usage today derives from free open
source downloads, MySQL hopes to move from the geek community to the
business community through the embedded database model, and they are
counting on this channel as a key to future revenue growth," Olofson said.
Mickos, who
said the company's goal is to "make superior database technology available
and affordable to all," said commercial licenses account for nearly two-thirds
of its revenues. The remainder of the company's earnings come from support
and services. MySQL charges a flat fee of $440 per server and customers can
have as many users and as many CPUs as they want.
"Put this in context of the pricing of other DBMSs [database management
systems] and you can understand why we sell so much," Mickos said.
Now, given the
price comparisons between MySQL and the other, strictly commercial vendors,
why isn't MySQL grabbing up market share by the fistful? Does MySQL not threaten
the three giants? No, and Mickos and his firm don't claim to. There are many,
many reasons for this, some of which Ellison alluded to last April. MySQL
is new, much smaller than the database behemoths, and does not offer much
of the special functionality of large database vendors, something that they
say the high-end, more specialized customers require.
"We focus on
the commoditized part of the market - the one in which performance, reliability,
convenience and price are the determining factors," Mickos said. As such,
Mickos said he and his outfit feel they are complementary to say, Oracle,
or IBM, who offer some highly specialized features, as opposed to competitive.
In practical terms, while Oracle may power the high-performance needs of
a search firm, certain departments might use MySQL as a simple alternative.
What the commercial vendors say
It's tough to
find members of the commercial side of things that would argue with Mickos.
Jeff Jones, director of strategy data management at IBM, praised MySQL and
its brethren, noting that they are commanded by smart people with some great
ideas. But he still sees the pros of the commercial side.
"I think you
can argue there is a focus and a clarity of requirement to the commercial
side," Jones said. "IBM has been working with databases since the '70s and
things are done differently. There is a different degree of ability, of relational
theory, for what we do. We have to bring scalability optimization, we have
to understand how to extend relational theory to handle things like XML,
to extend search technology, integrate more analytic capability, federate
integrated business intelligence."
Interestingly,
IBM has a small database offering that can slide into the low-end slot alongside
MySQL, in the recently released DB2 Express. Geared for the low-end market,
or a handful of seats, DB2 Express is priced at $499 per server, or $99 per
user.
Ken Jacobs,
vice president of product strategy at Oracle, shares Jones' feelings about
the main differences between the open-source database players and commercial
vendors of today. But, like Ellison, he suggested that it is Microsoft that
has the most to lose from open-source, arguing that the evolution of open-source
databases like MySQL could chomp away at Microsoft's low-end market share.
"Microsoft may
be the real target or victim here," he said. "When people make decisions
to purchase a database one of the deciding factors to go with open-source
is that it is cheap." Admitting that Oracle and IBM's products are not as
cheap because they target customers with more specialized needs, Jacobs said
any cannibalization from low-end products is likely to be in Microsoft's
camp. Jacobs said Oracle does not feel threatened by MySQL, and, like Mickos,
said he sees it as a complementary product. "These DBs are interesting and
can serve a niche. In fact, I'd argue that MySQL customers are also Oracle
customers who have outgrown SQL Server."
But Meta Group
analyst Charlie Garry has heard the arguments about MySQL and its brethren
not having the special functionality or scalability of a DB2 or a 9i. He
has a counter argument.
"There is a line of thinking that Oracle overshot the market by having too
much feature functionality," Garry said. "One is XML databases. There is not
a whole lot of people who are storing data in XML format."
"Now, there's an interesting feature I would guarantee, most people have
never even heard of it or knew it was in 9i," Garry said. Then there are
things like a partitioning option. More than 60 percent of enterprises are
running on 4 processors or less and 50 percent of the resources are unused.
A lot of people don't need partitioning, or 64-bit indexing that are offered
by commercial vendors, so these are not necessarily things that people want
to pay for."
"The beauty of open-source databases is that that we often see a cycle among
commercial vendors, where they to continue to add feature functions to trump
that other guy," Garry said. "Open-source databases are forcing users to
think what is important to me, and think about right-sizing. When you're a
tech leader like Oracle, you run into this rut where you have to drive
revenues, listen to investors who tell you need these esoteric features."
Page 2: Analysts and open-source advocates weigh in
 
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