Monday, March 15, 2004

Databases are the next to fall to open source...

Anyone wondering why Oracle's Larry Ellison is spending so much time pursuing an acquisition of Peoplesoft need look no further than open source database company mySQL and today's news (care of CNET) that mySQL will soon offer database clustering technology previously only found in high end commercial databases (like Oracle). Clustering is one of the few remaining reasons to buy a commercial database product.

Open source is an unstoppable market phenomenon. We will see open source projects that provide as good or better software to commercial competitors in every software category over time. Infrastructure elements such as operating systems (and now databases) are the first because the characteristics of these products are broadly understood in the marketplace and technical innovation in these categories tends to be incremental and not transformative.

Larry is right to try to move Oracle away from its dependence upon that core database revenue but wrong in trying to replace one software revenue stream with another. IBM is the only one of the tech giants that seems to clearly understand the future -- software is something you give away in order to lock customers into your other revenue streams.

Maybe Oracle should be trying to buy Accenture...

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