'Open Source' Database Poses Threat to Oracle
For decades, software makers got rich by selling programs for a steady flood of ever-cheaper computers. Now the forces of commoditization are starting to turn against one of the richest makers, Larry Ellison.
Mr. Ellison, chief executive of Oracle Corp., has long led the market for databases -- software that acts as a kind of universal filing cabinet and a foundation for writing other programs. That success gave Oracle the resources to move up market into business applications, and to make its recent $6.3 billion hostile bid for PeopleSoft Inc. to try to accelerate that push.
But now, Oracle and other database suppliers face a growing threat from below: "open source" databases, which give customers a free or low-cost alternative to commercial products. While the impact has been small so far, some analysts expect open-source software to eventually turn databases into a low-cost commodity, just as the open-source Linux operating system is posing a threat to Microsoft Corp.'s Windows franchise.
One user of an open-source database is Cox Communications Inc. The Atlanta-based cable-TV operator is using the software to monitor the performance of more than 1.5 million cable modems providing customers with high-speed Internet access. Mark Cotner, manager of network application development, originally got the system up and running on spare hardware and free software he downloaded from the Web site of MySQL AB, based in Sweden. The database now has 2.4 billion rows of information, totaling about 600 gigabytes of data.
Once Cox management was sold on the idea, some executives suggested transferring the operation to an Oracle system, Mr. Cotner says. For Cox's system, the price for licensing Oracle's system would have totaled about $300,000, not including a service contract. But even after Cox upgraded to the commercial version of the MySQL database, the company's licensing costs were under $1,000. Mr. Cotner also pays $12,000 a year for support services.
"Spending the extra money wasn't really justified," Mr. Cotner says. "You have to have complaints before you decide to spend more money on Oracle, and we've been very happy."
Oracle remains the leader in the $13 billion-a-year market for relational databases, the underlying software needed to run more specialized business applications, such as those sold by SAP AG, PeopleSoft and Oracle itself. But the total database market is stagnant, Oracle has been losing market share to Microsoft and International Business Machines Corp., and prices are falling.
Of course, the spread of open-source software threatens all of the commercial database providers. And some analysts expect that Microsoft's SQL Server, which is generally targeted at smaller businesses, may be most immediately affected. But the premium prices Oracle traditionally has been able to command as the market leader have the farthest to fall.
"It's very hard to compete with free," says John Chen, chief executive of Sybase Inc., Dublin, Calif., the No. 4 database provider. "It lowers the price point."
Oracle executives will discuss industry trends Wednesday at an annual meeting with financial analysts at the company's headquarters in Redwood Shores, Calif. Ken Jacobs, Oracle's vice president for product strategy, says MySQL's offering "is certainly interesting, but I don't see it as competition for Oracle. Not now and not for some time to come."
He says the open-source offerings are years behind Oracle's products in terms of features and functionality. And he says Oracle doesn't specifically target the types of customers that are using MySQL to run simple Web sites, focusing instead on "mission-critical, transaction-processing applications" that crunch large amounts of data and require complex statistical analysis.
"For years I've heard people say the database is being commoditized and I don't believe that," Mr. Jacobs says, though he acknowledges that over time MySQL and other open-source offerings will compete with Oracle in some areas.
Several years ago, Microsoft dismissed the threat from Linux, but more recently it has focused on it as a primary competitor. Kevin Harvey, a venture capitalist with Benchmark Capital in Menlo Park, Calif., says open-source databases are at about the same stage of development as Linux was several years ago. Benchmark last month put up the majority of MySQL's $19.5 million round of venture financing.
"The software business is being commoditized in a lot of ways," Mr. Harvey says. Areas that are ripe for change, he argues, have three characteristics, all of which apply to database systems: They are in widespread use, the industry has settled on common standards, and new features are less important than price and performance. Like Linux, he says, MySQL will first be used in new, Web-based applications and then be pulled by customers into more traditional corporate-computing functions. "It erodes from the bottom up," Mr. Harvey says.
MySQL's chief executive, Marten Mickos, makes a virtue of his product's stripped-down simplicity. "Software shouldn't be glorified," he says. "We say, 'Let's do this as compactly as possible and then sell it at a price that blows the competition away.' "
Unlike some other open-source software companies, MySQL offers both a free open-source license and a traditional commercial license, for which the company charges a flat licensing fee of $440 for each server computer running the software.
MySQL has only about 4,000 paying customers out of approximately four million active installations, but the Finnish entrepreneur doesn't mind. "With four million users it can't be bad," Mr. Mickos says. "Big customers know that hundreds of thousands of clever Indians and Russians and Americans are using the product. The value of that [in finding bugs and adding features] is astounding. That's the true power of open source."
Oracle's pricing is based on either the number of users with access to the software or the number of microprocessors in the computer running the program. Oracle's "enterprise edition," for example, is priced at $800 a user or $40,000 a processor, plus a 22% annual fee for software updates. A less powerful "standard edition" is priced at $300 a user or $15,000 a processor, with the same 22% annual maintenance fee.
Pricing made the difference to Westone Laboratories Inc., a closely held maker of ear inserts for hearing aids and other devices in Colorado Springs, Colo. When Cal Pearson , Westone's information technology director, needed to replace the 120-employee company's overloaded customer tracking and financial database systems, he was quoted a price of more than $160,000 for Oracle's system.
Instead, Mr. Pearson's team downloaded MySQL onto a personal computer and spent less than $5,000. Even without paying for support, his developers were able to get answers to questions within minutes by posting messages on a mailing list of other MySQL users.
Now, Westone is expanding the system to three remote locations and linking its order entry system with its customer database. Mr. Pearson says he now is happily paying MySQL's modest licensing fee and several hundred dollars a year for support. "Even with my employee costs, I've yet to spend what would have been my initial expenditure on Oracle."
"源代码公开"数据库挑战甲骨文
几十年来，软件厂商们通过向如潮水般涌来的价格愈来愈低廉的电脑提供程序来赚钱发财。但现在，软件商品化的趋势开始变得对最富有的软件商之一－－拉里?埃利森(Larry Ellison)不利。
作为甲骨文公司(Oracle Corp.)的首席执行长，埃利森长期以来一直是数据库市场的领军人物。数据库充当著多用途的档案柜，同时也是编写其他程序的基础。在数据库领域的成功使甲骨文公司获得了进军商用软件市场，并通过近期以63亿美元恶意竞购仁科(PeopleSoft Inc.)来试图加快这一进程的资本。
可如今，甲骨文和其他数据库供应商正面临著一个愈来愈大的威胁：那就是"源代码公开"的数据库，这使客户免费或以较低的成本获得了商业产品的替代品。虽然迄今为止这种数据库造成的冲击还很小，但一些分析师预计它最终将把数据库变为一种低成本商品，就像给微软公司(Microsofe Corp.)的Windows系统特许权带来挑战的源代码公开的Linux操作系统一样。
Cox Communications就是"源代码公开"数据库的用户之一。这家位于亚特兰大的有线电视运营商采用该软件来监控逾150万个电缆调制解调器的运行状况，这些解调器为用户提供高速互联网接入服务。最初是该公司负责网络应用开发的经理马克?科特纳(Mark Cotner)建立了这个系统，并使其运行在多余的硬件上，所运行的软件是他从瑞典一家名为MySQL AB的公司网站上下载的。该公司的数据库目前有24亿行信息，数据总量约为6,000亿字节。
科特纳说，每当Cox的管理层对开放源代码的数据库表示出兴趣，就有一些管理人员提出采用甲骨文的系统。对于Cox的这套系统而言，甲骨文系统特许权的总价格达到30万美元左右，这还不包括服务合同的费用。相比之下，即使Cox将该此系统升级到MySQL数据库的商业版本，所需的花费也不足1,000美元。科特纳还支付了12,000美元一年的支持服务费。
他表示，支付额外的费用的确没有道理。在你决定为甲骨文软件支付更多的费用之前肯定会有怨言。 甲骨文依然是年价值高达130亿美元的关系数据库市场上的领先者。关系数据库是指运行诸如SAP AG、仁科和甲骨文所售软件那样更加专业化的商用软件所需的基础软件。但是，整个数据库市场正处于萧条状态，而甲骨文的市场不断被微软和国际商用机器公司(International Business Machines Corp., IBM, 简称IBM)夺去，数据库软件的价格也不断下跌。
当然，公开源代码的数据库软件的普及对所有的商业性数据库供应商都构成了威胁。一些分析师预计，微软的SQL Sever受到的直接冲击可能最大，SQL Sever主要面向小企业。不过，作为市场的领军人物，甲骨文长期以来所能维持的高价必然遭遇最猛烈的冲击。
Sybase Inc.的首席执行长约翰?陈(John Chen)说，与免费产品竞争非常困难，免费产品降低了价格点。Sybase位于加利福尼亚州，是美国第四大数据库供应商。
甲骨文将于今日在公司位于加利福尼亚州的总部召开年会。在会议上，公司主管们将与金融分析师们探讨软件业的发展趋势。肯?雅各布斯(Ken Jacobs)是甲骨文负责产品战略的副总裁。他表示，MySQL的产品无疑很有趣，但他并不认为该产品会对甲骨文构成竞争，无论是现在，还是在将来的一段时期内。
他称，在产品特性和功能上，源代码公开的数据库产品比甲骨文的产品要落后好几年。他还表示，甲骨文并不是专门针对那些使用MySQL来运行简单网站的客户，而是关注那些需要处理大量数据，并进行复杂统计分析的"使命重大的交易处理应用软件"。
雅各布斯说，多年来，他一直听人们说数据库正趋向商品化，但他不这么认为。不过他也承认，随著时间的推移，MySQL和其他公开源代码的数据库供应商将在某些领域同甲骨文一争高下。
几年前，微软公司根本不把Linux放在眼里，但近来微软已把后者作为一个主要的竞争对手来关注。凯文?哈维(Kevin Harvey)是位于加州的Benchmark Capital的风险投资家。他表示，目前，公开源代码的数据库大约正处在像Linux几年前所处的那样的发展阶段。Benchmark上个月向MySQL规模为1,950万美元的一轮风险融资提供了大部分资金。
哈维说，在许多方面，软件业正逐步商品化。他表示，已具备变革条件的领域有三个特征，而所有这些特征，数据库领域全都具备，那就是：应用广泛、拥有共同的行业标准、价格与性能比新特性重要。同Linux一样，MySQL首先将被用于基于Web的新软件上，随后将被客户用于更加传统的企业运算领域。哈维称，它将自下而上地进行渗透。
MySQL的首席执行长马丁?米克斯(Marten Mickos)称赞其产品的简单性。他说，软件不应当华而不实。我们想使它尽可能地简洁化，然后以他人望尘莫及的低价出售。"
与其他一些提供源代码公开软件的公司不同，MySQL同时提供免费的源代码公开软件和传统的商业软件授权。该公司对后者的收费标准是：对每台运行其软件的伺服器一律收取440美元的许可费。
MySQL目前仅有约4,000个付费用户，而安装并使用其软件的用户有近400万。但这位芬兰企业家对此并不介意。他表示，拥有400万用户这一点可不算坏。大客户知道有成千上万个高智商的印度人、俄罗斯人和美国人在使用这一产品。发现缺陷，并添加新功能的价值是惊人的，这就是公开源代码的真正威力所在。
甲骨文的定价是基于使用软件的用户数量，或是运行软件的电脑内的微处理器数量。例如，该公司的"企业版"软件的售价为每个用户800美元，或每个微处器4万美元，另加22%的用于软件升级的年费用。而功能略逊一筹的"标准版"的售价为每个用户300美元，或每个微处理器1.5万美元，同样另收取22%的年维护费用。
对位于科罗拉多州的Westone Laboratories Inc.来说，软件的价格很重要。拥有120名员工的这家公司生产用于助听器的耳塞和其他装置。当公司的信息技术主管卡尔?皮尔森(Cal Pearson)需要更换公司超负荷的客户追踪和金融数据库系统时，甲骨文给他的报价超过了16万美元。
皮尔森的团队转而把MySQL的数据库下载到个人电脑上，并支付了不足5,000美元的费用。即便在未付出支持费用在情况下，他的开发人员通过给其他MySQL用户发邮件提问题，也能在几分钟内得到答案。
目前，Westone把该系统扩充到三个远端伺服器上，从而将订单输入系统与公司的用户数据库相连。皮尔森表示，他乐于向MySQL支付适度的软件特许费和一年几百美元的技术支持费用。他表示，即使加上员工的支出，也还赶不上付给甲骨文的初步费用。
