News
Sun To Acquire MySQL for $1 Billion
Move instantly makes Sun a player in the database market dominated by Oracle, IBM, and Microsoft
Sun Microsystems today said it will acquire MySQL, the leading supplier of open source database software, for $1 billion.
The move instantly makes Sun a player in the database market dominated by Oracle, IBM, and Microsoft. The acquisition is not the company's largest -- Sun paid $4.1 billion for StorageTek in 2005 -- but Sun CEO Jonathan Schwartz characterized it as the most significant in Sun's history.
"We're entering the $15 billion database market by acquiring the fastest growing and the leader of the open source database marketplace," Schwartz said during a conference call announcing the deal.
MySQL's 2007 revenues were approximately $75 million, according to Gartner Analyst Donald Feinberg.
"It's by far the most widely used in production of the open source DBMSes," he said.
The platform is a fast-growing open source database, boasting customers such as Facebook, Google, China Telecom, Toyota and others. MySQL entered the enterprise database market two years ago with MySQL 5.0.Nonetheless, MySQL has a small piece of that $15 billion marketplace. In 2006, open source database revenues accounted for just $140 million in revenues. Closely held MySQL confirmed to analysts that its revenues in 2006 were $50 million, or slightly more than one third of the entire market, Feinberg said.
Oracle's database sales in 2006 were $7.2 billion, accounting for 39 percent of the market. IBM came in at $4.3 billion with a 24 percent share and Microsoft had $3.2 billion, or 18 percent, according to Gartner.
Emerging Player
By acquiring MySQL, Sun can only accelerate the growth of the open source database market, Feinberg said. That's because Sun has a sales force of 4,000 and a huge partner program, compared with MySQL's sales force of 400.
"It changes the landscape," he said. "It's immediate in some areas but it's really more of a play for the longer term. I think, over the next five years, it will really start to grow."
While Feinberg acknowledged that Sun has a spotty track record with acquisitions, including StorageTek, he said he believes Sun's new leadership under Schwartz has learned from prior mistakes. Feinberg, who spoke with MySQL CEO Marten Mickos twice since the deal was announced, said Mickos is committed to making the deal work.
"I know him quite well and he wouldn't have said yes if he didn't believe it would help them grow the open source DBMS business," Feinberg said.
Entry Into DW Appliances
Observers say Sun's acquisition of MySQL should have little bearing on the overall database landscape. However, it will position Sun in the growing data warehouse and business intelligence appliance markets.
"The data warehouse appliance market will become one of the core markets," said Forrester analyst James Kobielus. "The vast majority of data warehouse appliances on the market run on open source databases."
Kobielus said he doesn't believe MySQL, even with its improved resources, will have a major impact on the general database market.
Josh Jones, a consultant with Consortio Services LLC and author of the forthcoming book, "Architecting Database Models for SQL Server" (Pearson Education, 2008), agrees.
"If anything, it might push those few people who were implementing (or planning on implementing) MySQL in Windows back towards SQL Server," Jones explained in an e-mail.
"It's really only a good thing for Solaris users, since they might end up with more options from an enterprise database standpoint," Jones added. Sun's Solaris 10 ships with PostgreSQL, a competing open source database.
Gartner's Feinberg said Sun shouldn't be underestimated. Although it never has owned a database, it has worked with Oracle for nearly 20 years. The growth of open source DBMSes is more likely to come at the expense of Oracle and IBM, while it could actually bolster Microsoft's SQL Server business, he added.
"Functionality-wise, they have some catching up to do," he said of MySQL, saying it is more advanced than SQL Server 7 but not quite up to par with SQL Server 2000. MySQL's Mickos expects the deal to have a much broader impact than some critics contend.
"With this acquisition by Sun, we will be able to offer those customers even better service, a full stack and, at the same time, heterogeneous solutions running on a number of platforms with a number of environments," Mickos said.
"We think it strengthens our ability to serve our existing customers and very importantly serve the new customers that we see coming as enterprises move over to Web-based architectures in their enterprise architectures, which is now happening."
Sun said it hopes to close the deal in the third or fourth quarter.-----Original Message-----From: Becky NagelSent: Thursday, January 17, 2008 9:38 AMTo: James Powell; Kurt Mackie; Michael Domingo; David NagelSubject: Updated Sun/MySQL StoryThis morning Jeff sent me a bunch of changes/additions to his Sun/MySQL story -- here's the code. FYI: I did check th new stuff and think I got everything, but let me know if you see anything. -- BeckySun Microsystems today said it will acquire MySQL, the leading supplier of open source database software, for $1 billion.
The move instantly makes Sun a player in the database market dominated by Oracle, IBM, and Microsoft. Though not the company's largest acquisition -- Sun paid $4.1 billion for StorageTek in 2005 -- Sun CEO Jonathan Schwartz characterized it as the most significant in its history.
"We're entering the $15 billion database market by acquiring the fastest growing and the leader of the open source database marketplace," Schwartz said during a conference call announcing the deal.
MySQL's 2007 revenues were approximately $75 million, according to Gartner analyst Donald Feinberg. "It's by far the most widely used in production of the open source DBMSes," he said.
The platform is a fast growing open source database, boasting customers including Facebook, Google, China Telecom, Toyota and others. MySQL entered the enterprise database market two years ago with MySQL 5.0.Nonetheless, MySQL has a small piece of that $15 billion marketplace. In 2006, open source database revenues accounted for just $140 million in revenues. Closely held MySQL confirmed to analysts that its revenues in 2006 were $50 million, or slightly more than one third of the entire market, said Feinberg.
Oracle's database sales in 2006 were $7.2 billion, accounting for 39 percent, IBM came in at $4.3 billion with a 24 percent share and Microsoft came in at $3.2 billion, or 18 percent, according to Gartner.
Emerging PlayerBy acquiring MySQL, Sun can only accelerate the growth of the open source database market, Feinberg said. That's because Sun has a sales force of 4,000 and a huge partner program, compared with MySQL’s sales force of 400. "It changes the landscape," he said. "It's immediate in some areas but its rally more of a play for the longer term, I think over the next five years, it will really start to grow."While Feinberg acknowledged that Sun has a spotty track record with acquisitions, including StorageTek, he said he believes Sun’s new leadership under Schwartz has learned from prior mistakes. Feinberg, who spoke with MySQL CEO Marten Mickos twice since the deal was announced, said Mickos is committed to making the deal work. "I know him quite well and he wouldn't have said yes if he didn’t believe it would help them grow the open source DBMS business," Feinberg said.Entry into DW Appliances
Observers say Sun's acquisition of MySQL should have little bearing on the overall database landscape. However, it will position Sun in the growing data warehouse and business intelligence appliance market.
"The data warehouse appliance market will become one of the core markets," said Forrester analyst James Kobielus. "The vast majority of data warehouse appliances on the market run on open source databases."
Kobielus said he doesn’t believe MySQL, even with its improved resources, will have a major impact on the general database market.
Josh Jones, a consultant with Consortio Services LLC and author of the forthcoming book "Architecting Database Models for SQL Server" (Pearson Education, 2008) agrees. "If anything, it might push those few people who were implementing (or planning on implementing) MySQL in Windows back towards SQL Server," Jones explained in an e-mail.
"It's really only a good thing for Solaris users, since they might end up with more options from an enterprise database standpoint," Jones added. Sun's Solaris 10 ships with PostgreSQL, a competing open source database.
Gartner's Feinberg said Sun shouldn't be underestimated. Though it never has owned a database, it has worked with Oracle for nearly 20 years. The growth of open source DBMSes is more likely to come at the expense of Oracle and IBM, while it could actually bolster Microsoft’s SQL Server business, he added. "Functionality wise, they have some catching up to do," he said of MySQL, saying it is more advanced than SQL Server 7 but not quite up to par with SQL Server 2000.MySQL's Mickos expects the deal to have a much broader impact than some critics contend. "With this acquisition by Sun, we will be able to offer those customers even better service, a full stack and, at the same time, heterogeneous solutions running on a number of platforms with a number of environments," Mickos said.
"We think it strengthens our ability to serve our existing customers and very importantly serve the new customers that we see coming as enterprises move over to Web based architectures in their enterprise architectures, which is now happening."
Sun said it hopes to close the deal in the third or fourth quarter.
--Jeffrey Schwartz