Page II: The market for database server software, seen as a barometer of overall software market health, grew slightly last year, fuelled in part by sales of Linux.
According to Gartner's study, Linux tops the lists of many database shoppers. Sales of database software on Linux systems nearly doubled in 2003, to nearly $300 million, Gartner said. That's still a drop in the bucket, compared with overall sales. But it shows that companies are seriously considering Linux for new enterprise systems, Graham said.
Much of the gains for Linux came at the expense of Unix, the big loser in 2003, according to the study. Sales of database software on Unix systems dropped by 6 percent overall, as more customers moved to other operating systems, primarily Linux, Graham said. Unix has for years been seen as the best choice for high-end databases.
IBM maintained its 35.7 percent share of the market, mostly though sales to small and mid-size businesses, according to Gartner.
One trouble spot for IBM is in its Informix database software line, which it acquired in 2001. Sales dipped by 16 percent in 2003, indicating that IBM hasn't been successful in converting those customers to its DB2 database, Gartner said. While a decline in Informix revenue was expected, the research firm had predicted that those customers would remain with Big Blue. Instead, some Informix users appear to have defected to rivals. An IBM representative acknowledged that its Informix installed base is "not as strong" as last year.
IBM instead focused its new sales on small and mid-size businesses buying iSeries servers. "That's a good plan, because large enterprises are saturated," Graham said. Mainframe deals typically involve upgrades to existing systems already owned by customers, she said. "They buy upgrades, but few new licenses."
Oracle jumps on Linux bandwagon
Oracle, the dominant Unix player, is now focusing on open-source operating system Linux. "The Unix market in general is declining," said Bob Shimp, vice president of technology marketing at Oracle. "Linux is growing rapidly."
IBM led the Linux database market in 2002, with $67 million in sales, compared with Oracle's $45 million. Now Oracle controls nearly 70 percent of the market, with $207 million in sales in 2003, compared with IBM's $85 million.
Graham said the growth in Linux sales is part of an orchestrated move by Oracle to cannibalise its own installed base on Unix before the company's competitors can step in and make a deal. "Because Oracle is the dominant player in a declining Unix market, they are telling customers to move to Linux," she said.
Oracle's Shimp said much of the company's Linux sales are due to consolidation from Unix. "But we are also seeing migrations from Windows to Linux. The trend in terms of new purchases is that people are choosing a lot of Linux for new systems," he said.
The lone bright spot in the Unix market is NCR's Teradata unit, which posted a 6 percent gain in 2003, according to Gartner. The company sells specialised databases for data warehouse and decision support applications.
15%
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