The Database Report – July 2007

Well, 2007 is officially at the midway point, and it is time for us to take a look at the activities within the database market over the past three months. It was a very active quarter, with
acquisitions, announcements, and squabbling over market share, among other “stuff.” So let’s dive right in and see what happened during April, May, and June of 2007.


IDC Puts Oracle “On Top”

In late April, IDC released its annual analysis of the market for database management system software. The study, titled “Worldwide RDBMS 2006 Vendor Shares: Preliminary Results for the Top Five
Vendors,” indicated that the entire market grew fairly well and that the smaller DBMS vendors built market share in 2006. But some things do not change, and IDC reports that Oracle keeps its crown
as the market share leader.

Let’s look at some of the details. IDC reports that the overall market for RDBMS software grew from approximately $14.4 billion in 2005 to about $16.5 billion in 2006. This represented a 14.3
percent growth rate. Oracle claimed 44 percent of the market, which is far and away the leadership position. IBM came in second with about 21.2 percent of the market, followed by Microsoft with an
18.6 percent market share. All three claimed healthy double-digit percentage growth year over year, but Microsoft was particularly noteworthy with a 25 percent gain in 2006 over 2005.

Sybase came in at number four, and Teradata was fifth, but both posted low growth rates (less than 5 percent). Interestingly, according to IDC, the rest of the field, represented by smaller RDBMS
vendors, grew at 5.3 percent.


Jabbering About Market Share

OK, sounds like 2006 brought more of the same, right? Well, the report actually brought on a war of words (of sorts). Computerworld reported the results of the IDC report and published a quote from
Mark Townsend, Oracle’s vice president of database product management. The April 26, 2007, edition of Computerworld quoted Townsend as saying, “IBM is slowly fading from the picture. Oracle and
Microsoft are taking share from DB2.”

Not content to just pick on IBM, Townsend gives his opinions on MySQL (since they are one of the companies in the growing smaller segment). He is quoted as saying, “It’s like comparing the free
town bicycle in the park to a car that someone pays for.”

Of course, IBM was not going to let those words ring out without having their say on the matter. In May, eWeek published an article outlining the verbal sparring going on between IBM and Oracle
over the market share issue. Bernie Spang, director of IBM data servers, questioned the status of DB2 vis-a-vis Oracle saying,  “The rapid adoption of DB2 9 would seem to call their claims
into question, and analysts are starting to question their numbers as well.”

Spang mentioned the coverage of Oracle’s results as covered by Philip Howard of Bloor Research. Howard’s take on the numbers were that 17 percent database and middleware growth when compared to
80 percent growth of just the middleware indicates Oracle’s database revenue is slowing. That seems to be a valid assessment.

Of course, IBM is spinning things here. Just because Oracle’s growth in the database segment is slowing does not mean that its overall market share necessarily is declining unless others are
growing much faster than Oracle. And that does not really seem to be the case.
 
Oracle’s response is basically to tout analyst market share reports. Remember that IDC’s report shows Oracle clearly in the lead with a market share that is more than double that of IBM (44
percent to 21.2 percent).
 
And that sounds like it would be hard for IBM to dispute. But Spang tried, saying, “The volume of new DB2 customers since we launched DB2 9 last July has exceeded all expectations. We have seen
literally thousands of new customers in that timeframe ““ and a large percentage of those are migrations from Oracle.”

I guess we’ll see if there is any credence to IBM’s claims when the next Gartner and IDC market share reports are released. We’ll be sure to look at those numbers as they are reported.


Oracle’s Additional Acquisitions

Apparently Oracle continues to be in an acquisitive mood. Early in the quarter, Oracle grabbed up the intellectual property assets of mobile application specialist AppForge. No financial details
were provided.

AppForge is known for its Crossfire plug-in to Microsoft’s Visual Studio and its Crossfire client for BlackBerry, Palm, PocketPC and other mobile devices. Before the acquisition, questions over
AppForge’s future surfaced in March as the company apparently ceased operations.

Then in mid-April, Oracle swooped in and plucked the IP out of AppForge. But this is a technology purchase only. As Oracle notes on its website: “Please note that Oracle’s acquisition of
AppForge’s intellectual property did not include the purchase of the company as a whole, or the purchase of other AppForge assets including its customer contracts. Accordingly, Oracle does not
plan to sell or provide support for former AppForge products going forward.”

So, what will Oracle do with those assets? Oh, I’m sure the technology will wind up in Oracle’s mobile applications.

Next up, in late April, Oracle announced it would be acquiring LODESTAR Corporation. LODESTAR was a provider of energy operation solutions including meter data management, commercial and industrial
(C&I) billing, load research, load forecasting and pricing, load profiling, and settlement and transaction management solutions. “With the addition of Lodestar’s products, Oracle plans to
deliver the most comprehensive suite of mission-critical operational systems for all segments of the utilities industry,” said Larry Hagewood, Senior Vice President and General Manager, Oracle
Utilities Global Business Unit. Financial details of the transaction were not provided.

In mid-May Oracle struck again, this time picking up Agile Software Corp., a product lifecycle management (PLM) software vendor, in an all cash deal worth $495 million. Oracle expects the deal to
close in July 2007.

PLM is the process of managing the entire lifecycle of a product from its conception, through design and manufacture, to service and disposal. The addition of Agile to Oracle’s applications
portfolio will help it to better compete with SAP’s robust PLM offerings.

These acquisitions follow Oracle’s numerous other application purchases over the course of the past few years and makes sense as the company attempts to position itself as the leading commercial
off-the-shelf software provider.

And Oracle bought yet another company in April (which it announced in late March). The company, Tangasol, provided in-memory data grid software. The Tangasol product is called Coherence Data Grid,
and it is used to improve application performance by providing fast, distributed access to frequently used data.

This acquisition makes sense because Tangasol’s software can be used with multiple Oracle offerings (Fusion Middleware, TimesTen and the stalwart Oracle Database) to deliver high-performance
access to shared data.


Oracle’s Financials

And Oracle continues to post nice earnings at the same time as it grows by acquisition.

Late in the first quarter, Oracle announced its 2007 fiscal third-quarter results. Earnings per share came in at 20 cents, up 36 percent over the same quarter last year. Third quarter revenues were
up 27 percent to $4.4 billion, while quarterly net income came in at $1.03 billion, which is an increase of 35 percent.

Total software revenues were up 25 percent at $3.5 billion, while new license revenue for database and middleware was up 17 percent, and new license revenue for applications was up 57 percent.

“Both revenue and earnings growth accelerated sharply in the third quarter,” said Oracle President and CFO, Safra Catz. “We exceeded guidance on every metric with strong revenue growth across
all product lines and in all geographies. We’ve now completed eleven quarters of our five-year EPS growth plan of 20% per year, and we are delivering earnings growth comfortably ahead of that
target.”


Oracle Sues SAP

One of the more intriguing stories of this past quarter is the lawsuit that Oracle slapped on rival applications software vendor SAP AG. The first sentence in the introduction section of this
lawsuit gives you a clear indication of what Oracle is charging. It reads as follows: “This case is about corporate theft on a grand scale, committed by the largest German software company–a
conglomerate known as SAP.”

If you read further into Oracle’s complaint, it alleges that SAP has stolen “stolen thousands of proprietary, copyrighted software products and other confidential materials that Oracle developed
to service its own support customers.” Basically, Oracle is claiming that SAP repeatedly accessed proprietary information from Oracle’s customer support website and that SAP was not authorized to
do so.

Why would SAP (allegedly) do this? Oracle claims that the information SAP surreptitiously gained access to enabled SAP to unfairly compete with Oracle by offering “cut rate support services.”

It would appear that the ongoing competition between Oracle and SAP is heading to a heated boil. It is too early to tell what will come of this, but I can’t help but think that Oracle has some
form of proof to be making such bold claims. But who knows? We’ll keep our eye on this lawsuit as it progresses its way through the court system. If you want to read the complaint (pleasant
dreams) you can find it here: http://www.oracle.com/corporate/press/2007_mar/sapsuit.html?rssid=rss_ocom_pr


Oracle Wins a Benchmark

I don’t usually report on benchmarks because they rapidly become obsolete as one vendor jumps over another, and this would be a boring report if all I did was cover who leads who in the ongoing
benchmark wars. But I’ll make an exception to give you a flavor of the current lay of the land for benchmarks.

In May, Oracle announced that it had set the new world record results on the two-tier SAP Sales and Distribution (SD) Standard Application Benchmark for 4-core and 8-core performance running on the
SAP ERP 2005 application.

Running AIX 5L 5.3 and SAP ERP 2005 on an IBM System p 570 with two dual-core 4.7 GHz POWER6 processors, Oracle Database 10g Release 2 achieved 2,035 SAP SD Benchmark users, setting a world record
performance result for a 4-core configuration. Oracle Database 10g Release 2 also achieved a second world record benchmark result of 4,010 SAP SD Benchmark users, for an 8-core configuration on
similar hardware.

OK, now do you see why I don’t write about these all that much?


On Oracle’s April Patch

In mid-April Oracle unleashed its regular quarterly release of software patches. The release contained fixes for 36 vulnerabilities, but only 13 of them were for the Oracle DBMS. The others were
for Oracle’s applications and other software offerings.

This might seem to be more ho hum than a benchmark to some of you, and I would not disagree except for one thing: the release did not contain a critical patch. Users of Oracle Database version
9.2.0.8 on Windows had to wait until the end of April to receive a fix for the DB01 flaw.

Basically, this flaw allows the DBMS to be remotely accessed over a network connection by users without authorization. So one of the most severe problems, albeit for an older version of the DBMS,
was not included in the regular quarterly patch. This caused some consternation among users because it was possible to exploit this flaw to surreptitiously access data or even shut down the
database server.

For those interested, details of the April 2007 patch can be found here.


IBM Unleashes a Cheetah

In June, IBM announced the next version of its Informix Dynamic Server (IDS) DBMS code named Cheetah. The new version, IDS 11, is planned to offer improved performance, better reliability and
scalability, and better techniques for handling large volumes of data. Hmmm–seems like this list is similar for every announcement of a new DBMS version, doesn’t it?

Anyway, the announcement was good news for the still large contingent of Informix users out there. DB2 is obviously IBM’s primary DBMS offering, but Big Blue is continuing to make good on its
promise to continue to improve the capabilities of Informix. IBM made that promise when it acquired Informix back in 2001.

An interesting feature of Cheetah is Advanced Access Control because it makes use of the label-based access control (LBAC) technology first introduced in DB2. LBAC provides a more granular level of
database security at the column and row level.

Other new features include GUI-based remote administration, XML publishing support and the ability to customize server footprints.

So, while Informix is no threat to the Big Three of Oracle, DB2, and SQL Server, neither does it seem on the verge of extinction.


IBM Conjures Up a Deal with MySQL

An interesting deal was announced by IBM and MySQL late in April that makes DB2 a certified storage engine for MySQL applications on IBM’s System i. For those not accustomed to the IBM hardware
nomenclature, this is what used to be called the AS/400 line (also known as iSeries servers).

As MySQL users know, the MySQL database offering can utilize different storage engines. For iSeries, IBM’s DB2 is now an option. DB2 is integrated with the iSeries operating environment, so every
iSeries user also has DB2 available. Now, they can utilize MySQL on top of DB2 storage.

The deal is quite interesting because it helps out everyone. IBM benefits because now its customers can use the open source MySQL platform to develop applications on the System i hardware. MySQL
benefits because it opens up another platform for their DBMS. And System i users benefit because they can deploy MySQL across multiple platforms, including Unix, Linux, Windows, and now their
System i servers.


Speaking of MySQL

Industry analyst James Governor (of Red Monk) announced in his blog that MySQL inked its first deal over $1 million late in the first quarter. The deal was with a European telco.

Additionally, in late May, MySQL announced that it will be holding its first ever MySQL users conference in Asia. The conference will be held at the National Museum of Emerging Science and
Innovation in Tokyo, Japan on September 11 and 12, 2007.

And in the final bit of MySQL news, late in April MySQL and CodeGear announced a partnership. CodeGear is Borland’s development tools business. The partnership will be focused on making it easier
to integrate MySQL into the CodeGear software, simplifying the creation of database-driven web applications.


The Katmai is Out of the Bag

The next version of SQL Server, formerly known by the code name of Katmai, will ship next year, and it will be branded as SQL Server 2008. The news was reported at Microsoft’s first Business
Intelligence Conference held in Seattle during the first full week of May.

Microsoft further reported that new releases of SQL Server will come out on 24- to 36-month intervals. This announcement obviously is a reaction to the 5-year interval between SQL Server 2000 and
SQL Server 2005.

According to Microsoft highlights of the new release, it will include improvements to security, reliability, performance and availability, but coupled with a low total cost of ownership. A key area
of improvement will be automation of maintenance tasks, which is not surprising since this has been a primary focal point for all of the DBMS vendors of late. A new declarative management framework
is planned that will enable policy-based management and configuration of SQL Server environments.

Additionally, SQL Server 2008 plans to deliver improved support for unstructured data, enabling users to manage multiple data types, including relational data, documents, geographic information and
XML.

If you want to read the Microsoft press release on Katmai, go here.

Later in the quarter, at Microsoft TechEd 2007 in June, Microsoft announced the availability of the first Community Technology Preview (CTP) of SQL Server 2008. You can download the latest CTP
here: https://connect.microsoft.com/SQLServer/content/content.aspx?ContentID=5395.


BIg Plans at Microsoft

But Katmai was not the only news out of Redmond; Microsoft also highlighted its strategy for business intelligence (BI) this past quarter. As might be expected, Microsoft’s big BI plans were
announced at its first BI conference in May. Its grand overarching goal? To make BI ubiquitous in the enterprise, used by all relevant workers.

But Microsoft has a leg up over its competitors in its ability to deliver on this vision because it is the supplier of Excel, arguably the most heavily used business intelligence tool in use at
corporations today.

Microsoft plans to utilize that large installed base to promote its BI platform. The Microsoft BI platform includes SQL Server, SharePoint Server and Microsoft Office (which incorporate Excel). It
will also incorporate a new offering, Microsoft PerformancePoint Server, which will server as the applications layer of the BI platform.

PerformancePoint Server is scheduled for delivery late this summer (2007), and it will offer analytics, dashboards, scorecarding, performance, planning and consolidation applications.

The combination of offerings in Microsoft’s BI platform is enviable and should improve Microsoft’s standing in the business intelligence market. Oh, Microsoft has been a player in the BI market
for some time, but its message has been somewhat muddled. With the BI platform and the new PerformancePoint Server, Microsoft is remedying its lack of attention to this market.


A Red Hat Database Appliance

Also this quarter, Linux vendor Red Hat announced plans to partner with Sybase to deliver a new database appliance offering. The appliance will run Sybase Adaptive Server Enterprise on Red Hat
Enterprise Linux 5 with the integrated virtualization.

It happened, so I am reporting it here. But I am yawning as I report it.


ANTs In The News Again, Too

Another DBMS company that is making waves these days is ANTs software, inc., based in Silicon Valley. ANTs offers the ANTs Data Server as an affordable, high-performance DBMS and whose hallmark is
compatibility with the big boys.

In May, the company announced the formation of the ANTs Compatibility Server Consortium, a step in bringing database consolidation to customers who require significant reductions in the cost and
complexity of their enterprise databases.

Basically, ANTs is in the business of offering a DBMS server that is compatible with other popular DBMSs, but at a lower price point.

More information about the Compatibility Server is available on the ANTs website.


Summary

Well, that is all I have for this quarter. But the year is only half over, so be sure to visit TDAN.com again next quarter to keep up to date on what is happening in the world of databases by
reading The Database Report.

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About Craig Mullins

Craig S. Mullins is a data management strategist and principal consultant for Mullins Consulting, Inc. He has three decades of experience in the field of database management, including working with DB2 for z/OS since Version 1. Craig is also an IBM Information Champion and is the author of two books: DB2 Developer’s Guide and Database Administration:The Complete Guide to Practices and Procedures. You can contact Craig via his website.

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