Relational Database Biz on Linux Is Booming

by Timothy Prickett Morgan

The fiercely competitive database market has not gotten any easier to be in, but did grow a bit in 2003, according to Gartner. The company says the overall relational database market grew by 5.1 percent in 2003, to $7.1 billion, a big improvement over the 6 percent decline database makers suffered through in 2002, when they only sold $6.7 billion in new licenses. (These figures do not include services and support revenues or sales of flat file database management systems still sold by IBM, Computer Associates, and a few other companies.)

Most of the growth in database sales can be attributed to sales of commercial Linux databases as well as steady growth for Windows databases. In fact, of that 5.1 percent in growth, 4.2 percent can be attributed to Linux databases, which were essentially non-existent as commercial products in 2002.

Gartner pegged IBM as the number-one relational database supplier of new license sales, which includes a lot of mainframe shops that pay for software on a monthly basis; they effectively book a new sale every month, to Gartner's thinking. IBM had $2.5 billion in database sales, up 4.9 percent. Rival Oracle, which dominates the Unix database market and has a healthy share of the Windows and Linux markets, had new license sales of $2.3 billion, according to Gartner, up 2.4 percent. Microsoft booked $1.3 billion in relational database sales in 2003, up 11.1 percent, and giving it 47 percent of the Windows database market, which was up 3.8 percent, to $2.8 billion. Sales of databases on Unix platforms declined by 5.9 percent, to $2.34 billion; Oracle had 57.4 percent of this market. Linux database sales were up 158 percent, to $299 million, and Oracle nearly quadrupled its sales (thanks to Oracle 9i Real Application Clusters, no doubt) and got 69.1 percent of the Linux database market.

Of course, there is not exactly consensus about the size of the database market and the market shares of the major players. The great thing about having two large researchers in the IT market is that you can very rarely get them to agree on anything. Gartner's data indicates that IBM squeaked by rival Oracle to capture the biggest piece of the relational database market in 2003, but IDC has declared Oracle the winner in 2003, and by more than a nose.

IDC says that Oracle, IBM, and Microsoft control three-quarters of the relational and object relational database markets, which accounted for $13.6 billion in 2003, a slight upturn. IDC reckons that Oracle had 39.8 percent of the market, followed by IBM with 31.3 percent and Microsoft with 12.1 percent. The company's analysts reckon that the relational database market will grow to $20 billion by 2008. It is hard to figure how that growth will come about, with the proliferation of open source and commercial derivatives of databases for all kinds of platforms.

The interesting questions now are, will the commercial Linux database market (by which I mean basically DB2 and Oracle) grow at the same rate, slow down, or accelerate in 2004? And will the open source database creators, specifically MySQL, be able to capitalize on the adoption of Linux as a database platform and sell (rather than give away) more Linux database licenses and support contracts in 2004?

If I had a crystal ball, it would probably tell me that the Linux portion of the database market would be going up exponentially in terms of shipments, but that the revenue stream coming off it could be anywhere from a few hundred million dollars to maybe as much as a billion dollars. It will all come down to a choice customers make: supporting these databases themselves, using open source and paying nothing (or very little), or going with familiar databases, like DB2 and Oracle, as they move from Unix systems to Linux.