The Database Report April 2013

The first quarter of the year is often not as active as the rest of the year. Many organizations are planning for the upcoming year and digesting what happened in the previous year. Although the first quarter of 2013 was not overactive with news, we nevertheless saw some interesting activity in the data and information management marketplace, especially in terms of acquisitions. So let’s move ahead and examine the database related news of the past quarter.

First Quarter 2013 AcquisitionsWe’ll start our quarterly overview by taking a look at the data-related acquisitions that transpired. As usual, Oracle was the busiest. Late in the fourth quarter of 2012 Oracle agreed to acquire Eloqua Inc. for approximately $871 million. By nabbing Eloqua, Oracle hopes to further expand into cloud computing amid competition from SAP AG and Inc. Eloqua, based in Vienna, Virginia, offers products that enable companies to tailor and measure the effectiveness of their marketing campaigns.

Oracle paid $23.50 per share for Eloqua, which is more than double the company’s initial public offering price in August. It is also 31 percent higher than the market closing price the day before the acquisition was announced.

“Modern marketing practices are driving revenue growth and is a critical area of investment for companies today,” said Thomas Kurian, executive vice president, Oracle Development. “Eloqua’s leading marketing automation cloud will become the centerpiece of the Oracle Marketing Cloud and is an important addition to the Oracle Customer Experience offering, which includes the Oracle Sales Cloud, Oracle Commerce Cloud, Oracle Service Cloud, Oracle Content Cloud and Oracle Social Cloud.”

The combination of Oracle and Eloqua should help Oracle to build a comprehensive Customer Experience Cloud offering to help companies improve the way they market, sell, support and serve their customers. The combined offering is expected to allow companies to provide a more personalized and unified experience across channels, create brand loyalty through social and online interactions, grow revenue by driving more qualified leads to sales teams, and enhance service.

But Oracle would not stop there. The company announced in mid February that it had agreed to acquire Acme Packet, a global provider of session border control technology for service providers and enterprises. Acme Packet enables trusted, first-class delivery of next-generation voice, data and unified communications services and applications across IP networks for service providers and enterprises. The company’s solutions are deployed by more than 1,900 service providers and enterprises globally, including 89 of world’s top 100 communications companies.

“The proposed acquisition of Acme Packet is another important piece in Oracle’s overall strategy to deliver integrated best-in-class products that address critical customer requirements in key industries,” said Oracle President Mark Hurd. “The addition of Acme Packet to Oracle’s leading communications portfolio will enable service providers and enterprises to deliver innovative solutions that will change the way we interact, conduct commerce, deliver healthcare, secure our homes, and much more.”

Oracle plans to make Acme Packet a core offering in its Oracle Communications portfolio to enable customers to more rapidly innovate while simplifying their IT and network infrastructures. This combination is expected to provide Oracle’s partners with an expanded portfolio of solutions to help them create even greater value for their customers.

IBM was also active in the acquisitions world during the first quarter of 2013. In early February, IBM agreed to acquire the software portfolio of Star Analytics Inc., a privately held business analytics company headquartered in Redwood City, California. Although the financial terms of the acquisition were not disclosed, it is expected to be finalized during the first quarter of 2013.

According to IBM, Star Analytics software can be used by organizations to automatically integrate essential information, reporting applications and business intelligence tools across their enterprises, on premise or from cloud computing environments. The software removes typical custom coding for specialized sources that are hard to maintain, and also eliminates manual processes that are cumbersome and time-consuming.

“IBM sees an enormous opportunity for our clients to apply Star Analytics to the information they have stored in their financial applications,” said Leslie J Rechan, General Manager, IBM Business Analytics. “And to then easily access it within their IBM performance management and business intelligence solutions.”

“Star Analytics software allows organizations to move critical analytics source data at will and use it regardless of which application they need to use it with, providing both flexibility and accessibility,” said Quinlan Eddy, CEO, Star Analytics. “As part of IBM, we can now bring our technologies to a broader range of clients to help them uncover new, untapped growth opportunities.”

The acquisition of Star Analytics software is just the latest in a series of 30 acquisitions over the past five years targeting analytics and big data technology. The combination of IBM and Star Analytics software should help to further advance IBM’s business analytics initiatives, allowing organizations to gain faster access and real-time insight into specialized data sources.

IBM also announced in February that it had completed the acquisition of StoredIQ, which was initiated by IBM in the fourth quarter of last year.

Microsoft stuck its toes in the acquisition waters this quarter, too. In early March, the company announced that it had acquired MetricsHub, a cloud monitoring concern that offers a service to automate its customers cloud performance management. Financial details of the transaction were not disclosed but since MetricsHub had only 374 users it is unlikely that Microsoft paid much for the company.

MetricsHub, also based in Bellevue, Washington, participated in Microsoft’s Accelerator program, which offered startup companies with a $20,000 investment, office space, technical training and support, and mentorship. Evidently Microsoft liked what MetricsHub produced, because they bought them.

And in early March, SAP acquired Camilion, a provider of insurance product development, product life-cycle and underwriting solutions that help insurance companies significantly improve the quality of the business they write and bring new products to market faster. The financial terms of the deal were not disclosed.

The deal will broaden SAP’s solution portfolio in the insurance space by providing insurers with powerful software tools to streamline the management and creation of new products.

But this was not the only acquisition made by SAP this past quarter. The company also acquired SmartOps in late February. The financial terms of the deal were not disclosed.

SmartOps is a provider of inventory and service-level optimization software solutions. Via this acquisition SAP can develop “real-time supply chain” software solutions that leverage the SAP HANA platform. SmartOps provides key operating parameters and targets for supply chain management (SCM) planning. The company’s solutions coordinate capacity, inventory, demand, lead time and product availability variables that enable customers to optimize inventory and service levels, freeing up working capital for innovation and growth.

Founded in 2000, SmartOps released its first product in 2001. The company has had a formal business relationship with SAP since 2006 and for the last four years has been a part of the program for solution extensions at SAP. SmartOps’ customers include major brands in the manufacturing, distribution, chemical, life sciences, retail, high-tech and consumer product industries.

And finally, at least on the acquisitions front, in late January Actian Corp. agreed to acquire all of the outstanding shares of Pervasive Software Inc. for $9.20 per share. Actian, the current home of the Ingres DBMS, also markets and sells Vectorwise (an analytical DBMS) and the Versant Object Database (acquired by Actian from Versant Corporation). At $9.20 per share, the deal values Pervasive at $161.9 million.

“Big data is an opportunity and a challenge for organizations in every industry, with potentially valuable business critical insight locked away in inaccessible and indecipherable systems. This makes data management and insight today’s big question for businesses looking at how to unlock the substantial incremental business value in their big data,” said Steve Shine, CEO & president of Actian Corporation. “This transaction combines the proven ability of both companies to out-innovate and out-perform the industry giants allowing us to deliver the promise of big data to every organization.” Shine continued, “We want to give customers the tools to get to the data, find those nuggets of insight and act on it immediately.”

It will be interesting to watch as Actian and Pervasive work to build a cohesive big data product solution set from the products of the various companies that are now aligned under the Actian brand. The company now offers multiple DBMS offerings, various apps, and several analytics products that will need to be blended into a coherent portfolio.

By The NumbersAfter examining the acquisitions of the past quarter, it is time to turn our attention to the quarterly financial announcements of the major data and database organizations: Oracle, Microsoft, IBM, and SAP. This time, we’ll start with IBM…

IBM’s Third Quarter
IBM reported fiscal third quarter earnings of $3.62 versus expectations of $3.61 per share. But revenue came in lower than expected at $24.75 billion. The company says currency adjustments hurt revenue growth by about $1 billion. IBM also reaffirmed its full-year earnings per share guidance of $15.10.

Both the Software and Services business segments were flat this quarter for IBM with Software coming in down 1 percent (up 3 percent at constant currency) and Services down 5 percent (flat at constant currency). The big hit came for Systems and Technology revenue (the hardware segment) which was down 13 percent (12 percent at constant currency).

“In the third quarter, we continued to drive margin, profit and earnings growth through our focus on higher-value businesses, strategic growth initiatives and productivity,” said Ginni Rometty, IBM chairman, president and chief executive officer. “Looking ahead, we see good opportunity with a strong product lineup heading into this quarter and annuity businesses that provide a solid base of revenue, profit and cash.”

Revenues from the Software segment were $5.8 billion, down 1 percent (up 3 percent, adjusting for currency) compared with the same quarter last year. Software pre-tax income increased 6 percent and pre-tax margin increased to 35.6 percent (up 10 percent and 37.1 percent, respectively, when adjusted for workforce rebalancing charges in the third quarters of 2011 and 2012).

Revenues from IBM’s key middleware products, which include WebSphere, Information Management, Tivoli, Lotus and Rational products, were $3.6 billion, down 1 percent (up 3 percent, adjusting for currency) versus the third quarter of 2011. Operating systems revenues of $597 million were flat (up 4 percent, adjusting for currency) compared with the prior-year quarter. Isolating out just the Information Management brand, which is where DB2 revenue is reported, revenues were down 1 percent (up 3 percent, adjusting for currency) versus the same quarter last year.

IBM ended the third-quarter 2012 with $12.3 billion of cash on hand and generated free cash flow of $3.1 billion, excluding Global Financing receivables, down approximately $0.3 billion year over year. The company returned $4.0 billion to shareholders through $1.0 billion in dividends and $3.0 billion of share repurchases. The balance sheet remains strong, and the company is well positioned to support the business over the long term.

SAP’s Third Quarter
For its fiscal third quarter, SAP beat market expectations for revenue growth and achieved strong 17 percent year over year growth in software licenses (12 percent at constant currency) with $1.3 billion in revenue. In software and software related services revenue year over year growth came in at 19 percent (13 percent at constant currency) with $4.1 billion in revenue. This was the 11th consecutive quarter of double-digit software and software-related services growth for SAP.

“Our innovation strategy continues to deliver world-class value and market leading performance,” said Bill McDermott and Jim Hagemann Snabe, Co-CEOs. “With SAP, businesses are innovating, achieving operational excellence and driving growth. We are proud of our relentless customer focus and confident that we’ll continue to outperform the competition.”

Earnings in EMEA were relatively flat year over year coming in at -1 percent (-2 percent at constant currency), but the results must be tempered by the large Q3 SAP experienced in EMEA last year (20 percent growth). On the other side of the Atlantic, the Americas delivered an outstanding Q3 with 37 percent software growth (29 percent at constant currency). Among the highlights for the quarter was SAP’s new partnership with the National Football League, which chose SAP’s cloud-based collaboration and analytical solutions to transform its Fantasy Football platform.

In database software, HANA, SAP’s flagship in-memory data platform, posted very strong results with EUR 83 million of revenue and triple digit growth in Q3. HANA appears to be gaining quite a bit of traction in the market, not just for SAP applications, but for other traditional database management needs. SAP CTO Vishal Sikka presented the first petabyte of data stored in the HANA database. This is the equivalent of 10 years of transactions in a company doing 330 million sales transactions per day.

Heading into Q4, SAP claims to have a significant HANA pipeline and expects to achieve at least EUR 320 million in HANA revenue for the full year.

Additionally, the SAP Sybase ASE database business also experienced strong double-digit growth for the quarter.

Microsoft’s Second Quarter
Microsoft announced stellar second quarter results with $21.46 billion in revenue for the quarter ended December 31, 2012. Operating income, net income, and diluted earnings per share for the quarter were $7.77 billion, $6.38 billion, and $0.76 per share.

“Our big, bold ambition to reimagine Windows as well as launch Surface and Windows Phone 8 has sparked growing enthusiasm with our customers and unprecedented opportunity and creativity with our partners and developers,” said Steve Ballmer, chief executive officer at Microsoft. “With new Windows devices, including Surface Pro, and the new Office on the horizon, we’ll continue to drive excitement for the Windows ecosystem and deliver our software through devices and services people love and businesses need.”

The Windows Division posted revenue of $5.88 billion, a 24 percent increase from the prior year period. Microsoft has sold over 60 million Windows 8 licenses to date.

“We saw strong growth in our enterprise business driven by multi-year commitments to the Microsoft platform, which positions us well for long-term growth,” said Peter Klein, chief financial officer at Microsoft. “Multi-year licensing revenue grew double-digits across Windows, Server & Tools, and the Microsoft Business Division.”

The Server & Tools business reported $5.19 billion of revenue, a 9% increase from the prior year period, driven by double-digit percentage revenue growth in SQL Server and System Center.

“We see strong momentum in our enterprise business. With the launch of SQL Server 2012 and Windows Server 2012, we continue to see healthy growth in our data platform and infrastructure businesses and win share from our competitors,” said Kevin Turner, chief operating officer at Microsoft. “With the coming launch of the new Office, we will provide a cloud-enabled suite of products that will deliver unparalleled productivity and flexibility.”

The Microsoft Business Division posted $5.69 billion of revenue, a 10 percent decrease from the prior year period.

And Microsoft’s outlook for the remainder of the fiscal year is bright. The company reaffirmed fiscal year 2013 operating expense guidance of $30.3 billion to $30.9 billion.

Oracle’s Second Quarter
Oracle Corporation announced fiscal second quarter 2013 total revenues up 3 percent to $9.1 billion. New software licenses and cloud software subscriptions revenues were up 17 percent to $2.4 billion. Software license updates and product support revenues were up 7 percent to $4.3 billion. Hardware systems products revenues were $734 million, down 24 percent. Operating income was up 12 percent to $3.5 billion, and operating margin was 38 percent.

Without the impact of the US dollar strengthening compared to foreign currencies, Oracle’s reported second quarter earnings per share would have been $0.01 higher at $0.54, up 26 percent, and second quarter earnings per share would have been $0.01 higher at $0.65, up 19 percent. Total revenues also would have been up 5 percent, and new software licenses and cloud software subscriptions revenues would have been up 18 percent.

“New software license sales and cloud subscriptions grew 18 percent in constant currency,” said Oracle President and CFO, Safra Catz. “During the last four quarters operating cash flow was more than $13.5 billion – $10.2 billion of which was returned to our shareholders as we repurchased nearly 350 million ORCL shares during that same twelve month period.”

According to Mark Hurd, Oracle President, applications, middleware and database software all experienced double-digit growth in new software license and cloud subscriptions, with applications leading the pack with growth of over 30 percent.

Even as hardware revenue declines, Oracle CEO Larry Ellison continues to tout the strategic importance of Oracle’s acquisition of Sun Microsystems. “Sun has proven to be one of the most strategic and profitable acquisitions we have ever made,” said Oracle CEO, Larry Ellison. “Sun technology enabled Oracle to become a leader in the highly profitable engineered system segment of the hardware business. I believe that products like Exadata and the SPARC SuperCluster will not only continue to drive improved profitability in our hardware business, by the end of this fiscal year, they will also drive growth in our hardware business.”

MySQL 5.6 Released in the Second QuarterIn early February Oracle released the latest version of MySQL… MySQL 5.6. The highlight of this latest version of the open source DBMS is the incorporation of NoSQL functionality into the offering.

The last official release of MySQL (5.5) came out three years ago in 2010. Since then, of course, the Big Data rage has swept across the database marketplace and NoSQL is a hot commodity now. MySQL 5.6 improves developer agility with subquery optimizations, online Data Definition Language (DDL) operations, NoSQL access to InnoDB, new instrumentation in Performance Schema and better condition handling. With MySQL 5.6, users can experience simplified query development and faster execution, better transactional throughput and application availability, flexible NoSQL access, improved replication and enhanced instrumentation.

“MySQL 5.6 Release Candidate received great feedback from the community and helped us to efficiently mature the technology to announce General Availability,” said Tomas Ulin, vice president of MySQL Engineering. “The new features and enhancements that MySQL 5.6 delivers further demonstrate Oracle’s investment in driving MySQL innovation, making MySQL a fantastic fit for today’s most demanding Web, Cloud and embedded application requirements.”

In addition to the NoSQL layer, Oracle is touting the performance improvements in MySQL 5.6. Via an improved InnoDB storage engine users can achieve up to 230 percent improvement in transactional and read only throughput. In part, such gains can be achieved by InnoDB because it has been re-factored to minimize legacy threading, flushing, and other contentions and bottlenecks, enabling better concurrency on heavily loaded OLTP systems, and resulting in significantly improved throughput for both transactional and read only workloads.

Additional highlights of the new release include enhanced availability with online DDL, full-text search with InnoDB, improved query execution times and diagnostics provided through an enhanced MySQL Optimizer and simple migration from MySQL 5.5 to 5.6.

MySQL 5.6 is available for immediate download at

IBM Enhances PureSystems for Big Data and the Cloud In early February IBM announced enhancements to its PureSystems portfolio. Recall from earlier edition of The Database Report that IBM defines PureSystems as “a new category of expert integrated systems” and “a major step forward in a new, simpler era of computing.” Basically, you can think of PureSystems as pre-configured hardware with pre-installed software – you buy it, plug it in, and it works.

The new PureSystems models help to remove the complexity of developing cloud-based services by making it easier to provision, deploy and manage a secure cloud environment. The need to process big data is addresses by the new IBM PureData System for Analytics, powered by Netezza technology. It features 50 percent greater data capacity per rack and is able to crunch data 3 times faster. The IBM PureData System for Analytics is designed to assist organizations with managing more data while maintaining efficiency in the data center – a major concern for clients of all sizes.

Furthermore, IBM is introducing new cloud options tailored for the data center that allow businesses of all sizes to free up time and money to focus on innovation. These offerings include:

  • Smaller PureApplication System: offer a “cloud in a box” for organizations with limited budgets and resources.
  • PureApplication System on POWER7+: For larger enterprises, particularly those in financial services and insurance, this PureSystems model provides the ability to better manage and maintain compute and transaction-intensive applications across environments, including the cloud, where up-time and performance are mission critical.
  • Expanded Software Patterns Catalogue: Accessible through the PureSystems Centre, patterns can be used to dramatically reduce the time it takes to install, manage and maintain applications.
  • Managed Service Provider Editions for PureFlex System and Flex Systems: IBM has created “MSP Editions” for IBM PureFlex System and IBM Flex Systems that provide an accelerated cloud deployment platform that is faster to implement, easier to manage, and more cost effective than the MSP having to build the platform themselves.
  • SmartCloud Desktop Infrastructure: IBM is also announcing a new SmartCloud Desktop Infrastructure offering, for IBM PureFlex System and Flex Systems. This new offering will enhance the overall quality and reliability of virtual desktops and enables IT managers to easily manage, secure and deploy virtual desktop solutions. Clients can now securely deploy desktop access to mobile devices. This capability will allow clients to set up desktop access in minutes and provides rapid recovery from theft, failure and disasters.

Oracle Releases Database Appliance X3-2In early March, Oracle announced the general availability of Oracle Database Appliance X3-2 that provides up to twice the performance and supports over four times the storage as compared to the original Oracle Database Appliance. Oracle Database Appliance is a complete package of software, server, storage and networking engineered for simplicity and high availability to help customers and partners take advantage of the Oracle database.

Oracle upgraded the Oracle Database Appliance X3-2 hardware with 512 GB of memory, 18 TB SAS disk storage and 800 GB flash to enhance performance for online transaction processing and data warehousing. Compared with the previous version, the Oracle Database Appliance X3-2 now offers: up to 2 times faster performance, more than 4 times the storage capacity, almost three times flash capacity, and more than 2.5 times the memory.

Oracle Database Appliance X3-2 optionally features a Virtualized Platform, which is built on Oracle VM, enabling ISVs to package and ship a complete solution-in-a-box. With the addition of virtualization support, customers can quickly deploy complete, highly available solution appliances to remote branch office locations where IT footprint and skills may be a challenge.

By simplifying deployment, maintenance and support of database workloads, the Oracle Database Appliance helps businesses of all sizes reduce their risk while saving time and money managing their valuable data and applications.

“When we introduced the Oracle Database Appliance, it offered growing businesses and departments a greatly simplified way to manage and harness the power of Oracle Real Application Clusters,” said Sohan DeMel, vice president, product strategy and business development, Oracle. “With the second generation, we’ve infused this engineered system with up to twice the power and added virtualization support.”

Oracle Releases PeopleSoft 9.2In late March, Oracle announced new versions of its PeopleSoft Human Capital Management 9.2, PeopleSoft Financials 9.2 and Supply Chain Management 9.2 applications. According to Oracle, this new release clearly demonstrates its commitment to continue to invest in PeopleSoft because it includes more than 1,000 new features, functions, and enhancements.

With the delivery of PeopleSoft 9.2, Oracle will simultaneously provide upgrade scripts as well as the multi-language version of this release, a first for PeopleSoft applications. This enables PeopleSoft customers around the world to immediately begin implementing PeopleSoft 9.2 and reap its benefits sooner.

A number of customers and partners have been working with Oracle as early adopters of PeopleSoft 9.2 and have already started their implementation and upgrade projects. Some of these customers include: AARP, Caterpillar Inc., and Verizon.

“With revolutionary innovations in user experience, Oracle’s PeopleSoft 9.2 has new features and functionality designed to help users work more efficiently, get their work done quicker, and in a way that’s more familiar based on consumer technologies. And, with dramatic improvements in operational cost management, we believe Oracle’s PeopleSoft 9.2 is a game changing release,” said Paco Aubrejuan, senior vice president and general manager, Oracle’s PeopleSoft Applications.

Other Product News for Q1And in other product-related news for the first quarter of 2013:

  • In early March, IBM announced that all of its cloud services and software will be based on an open cloud architecture. As a first step, the company unveiled a new private cloud offering based on the open sourced OpenStack software that significantly speeds and simplifies managing an enterprise-grade cloud.
  • In early February Oracle introduced the Oracle Snap Management Utility, a new enhancement to its storage software portfolio designed to streamline and automate critical tasks for customers using Oracle Database with Oracle’s Sun ZFS Storage Appliance.
  • In early February, WellPoint, Inc. and Memorial Sloan-Kettering Cancer Center unveiled the first commercially developed IBM Watson-based cognitive computing breakthroughs. After ingesting more than 600,000 pieces of medical evidence, two million pages of text from 42 medical journals and clinical trials in the area of oncology research, Watson now has the power to sift through 1.5 million patient records representing decades of cancer treatment history, such as medical records and patient outcomes, and provide to physicians evidence based treatment options all in a matter of seconds. These innovations stand alone to help transform the quality and speed of care delivered to patients through individualized, evidence based medicine.
  • In late January Oracle announced new Oracle Exalogic Elastic Cloud Oracle VM Templates for several Oracle Applications, which encapsulate the best application deployment practices based on years of expertise with more than 70,000 Oracle Applications customers.

IBM Tops U.S. Patent List AgainIn late January IBM proudly announced that the company was number one atop the list of U.S. patent recipients. This marked the 20th consecutive year that IBM topped the list. In 2012, IBM received 6,478 patents for inventions that span analytics, big data, cyber security, cloud, mobile, social networking and other areas.

IBM highlighted its Watson system as an example of the byproduct of its research labs that churn out these patents. You may recall the IBM Watson system from its appearance on the game show Jeopardy, where it soundly beat the game’s best player. Watson enables a computer to ingest a question expressed in natural language, understand it, and deliver an answer to the question.

More information is available on the annual list of U.S. patent recipients from the IFI CLAIMS Patent Services.

Onward to the Second Quarter…And that brings us to the end of our first quarter coverage of the database marketplace. The year is off to a brisk start with new products, plenty of acquisitions and intriguing financial performances. If you manage or use data in your profession, you’ll want to keep up-to-date on the happenings in the realm of database systems throughout the coming year, so be sure to check back with us every quarter to read each new edition of The Database Report on

Share this post

Craig Mullins

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.

scroll to top
We use technologies such as cookies to understand how you use our site and to provide a better user experience. This includes personalizing content, using analytics and improving site operations. We may share your information about your use of our site with third parties in accordance with our Privacy Policy. You can change your cookie settings as described here at any time, but parts of our site may not function correctly without them. By continuing to use our site, you agree that we can save cookies on your device, unless you have disabled cookies.
I Accept