should oracle have bought mysql?

July 4, 2008 at 9:30 am | Posted in Business, Technology Trends | 7 Comments
Tags: , , , ,

I’ve talked a bit about MySQL and a commenter on that thread agreed that they are really well positioned to be a cloud player. Before Sun acquired them, it was public knowledge that Oracle had made a bid for MySQL. Marten Mickos, MySQL’s CEO, got pretty aggressive in the media against the bid saying they didn’t want to be acquired, but rather wanted to grow to be a strong, independent company. Then they were bought by Sun. I think Marten would make the argument that they ARE still a strong, independent *database* company, even though they are inside of Sun. And that does have some merit.

But that said, MySQL was accountable to their investors and if Oracle had bid high enough, the deal would have happened. I was asked on a call the other day if Oracle screwed up by not making that deal happen. In the short-term, I don’t think so. But in the long term… I think they have a real threat on their hands.

Cloud computing represents the biggest disruptive technology the industry has seen in a long time. Today, the cloud databases are not anywhere nearly as capable as their traditional counterparts. How much do they need to be? You can pretty much do everything you need in the app layer. It’s harder, but does have it’s benefits. But of all the “traditional” databases, MySQL is best positioned (I think) to move to the cloud effectively.

We shall see, but I think it would have been wise for Oracle to pony up now and have them under their umbrella. Then again, Larry [Ellison, Oracle CEO) seems to have done OK thus far without any advice from me. 😉

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  1. I don’t think Oracle is going to be kicking themselves too hard here. From memory in October 2005 Oracle announced it had acquired InnoDB (the most popular transaction storage engine for MySQL). In late January 2006 Marten Mickos confirmed that Oracle had made a bid for MySQL which was not accepted, although didn’t state exactly when this occurred. And a few weeks later in Feb 2006 Oracle announced it had acquired BerkleyDB, the other popular transactional storage engine for MySQL.

    One view could be that Oracle tried to acquire MySQL, and when it failed it picked up the key dependencies of MySQL that MySQL itself didn’t control. Another view might be that Oracle had a strategy to acquire all the pieces of the MySQL stack and failed to acquire the central piece, MySQL itself.

    So for suspected pocket change compared with the $1 billion that Sun paid, Oracle still very much has a significant hand in the MySQL pie. While InnoDB is GPL, so in theory it can be forked and developed outside of Oracle’s control, Oracle owns the innovation centre for InnoDB so this is unlikely to happen unless Oracle dumps it (which itself is unlikely, more probable Oracle will continue to develop it to maintain it’s position but I wouldn’t expect major new features to appear in InnoDB ahead of Oracle’s own products though).

    Ultimately I don’t think Oracle believes in the MySQL business model enough to pay the price they were asking (I think they saw MySQL as a trajectory offering rather than a direct source of strong revenue growth). Clearly Jonathan Schwartz has different ideas, but with MySQL revenues of only $70-80 million (0.4% of the $18.8 billion RDBMS market) that also remains to be seen.

    What also remains to be seen is how MySQL’s business model flies in a Sun, a public company that has to be concerned about things like revenue, targets, profits etc. If I make one of my products better (fix bugs, easy usability, ease integration) that means I will sell more and increase revenue. How will enterprise view building a dependency on a product whose revenue stream is fully tied to a paid support? Dismiss the concerns as much as you like; it just seems like common sense that making such a product more robust, more usable, more reliable has to be somewhat counterproductive to the vendor. I don’t want to start a whole debate around Open Source business models, but there is no one else doing this today in any sort of scale in the RDBMS market (IBM, Oracle and Microsoft’s free offerings are more entry point teasers) so it is another area of wait and see.

    Anyway it is all very incestuous. Sun owes a lot to Oracle, but in their apparent move to gain some independence from Oracle (Schwartz had reportedly stated for a while that they wanted to fill their gap in the database market) they have acquired a product which currently has a dependency on Oracle. Stay tuned because who can predict how all of this will pan out!

  2. It definitely is a fascinating model to watch unfold. I don’t think Oracle ever had any delusions of about MySQL making them a ton of money. I think it was more acquiring a gnat that could eat away some of their low-end revenue in a very tough market. But that’s all speculation.

    Sun seems perfectly content to give away software. Where it will ultimately lead is a matter of no small debate. And, as you say, it gets us quickly into the OSS debates which are long and passionate to say the least.

    Personally, I think MySQL’s future is in the cloud and in specific verticals with MySQL cluster. As you say, only time will tell.

  3. Billy, you said, “Today, the cloud databases are not anywhere nearly as capable as their traditional counterparts.” What do you think is the hold up? Is it just a matter of bandwidth or are there shortcomings on the client side?

  4. * Russ, there’s a lot going on with that question. At it’s core, there are two main reasons they did not put the relational model into the cloud: Scale and Cost.
    You cannot scale-out a relational database without complexity and (usually) added cost. With SimpleDB and BigTable, scale out is really straight forward.
    There’s also a religious war that goes on within the development community that, by most accounts, seems to be split down the middle. And that is around the application controlling all state and transactional integrity vs letting the database do it. Many believe the database has become overly complicated and sacrifices performance and scale in order to serve multiple functions that it really shouldn’t be serving.

    I am hoping Tony Bain writes a nice post on cloud databases soon (he said one is coming) so I can be lazy and just link to his post! But if there’s enough interest, I can take on some questions here as they come up as well.

  5. Billy and Tony – do you think Larry made a mistake buying Sleepycat’s Berkleydb to get into this space?

    Personally, I wouldn’t like to be Sun going up against Oracle. I bet Larry got Sleepycat for a steal, and doing it two years ago means Oracle has a bit of a headstart on Sun’s integration of MySQL. http://opensource.sys-con.com/read/603228.htm

  6. I don’t think they made a mistake. And I don’t think they are quite done with it either. Rumors have been around for sometime as to what they might do with it. And, as you say, to them I’m sure it was a drop-in-the-bucket acquisition to learn more about the open source market, whatever their reason.
    The difference between MySQL and Sleepycat is religious. MySQL has a large following of zealots. Sleepycat does not. Zealots are a powerful customer base and are often underestimated in their staying power. Question will be whether MySQL can keep that rabid base in a Sun world. And also if the cloud DB’s decide to evolve. And… well, there’s a ton of questions actually!

  7. Thanks Billy – I need some more education on cloud dbs 😉


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