The Race for More Market Share

• 09/06/2000

IBM thinks it's important. In its announcement of the certification the company boasted how it, too, beat Oracle Corp. (www.oracle.com) to the punch. Oracle representatives, however, say the company never intended to have its line W2K certified, so how could Oracle be beaten by IBM?

"We've never certified Oracle to the Microsoft specification, and we don't intend to. It could slow down our software release process," says Bob Shimp, senior director of Internet platform development at Oracle.

But IBM believes being the first with certification is a strong asset in its favor. "The certification process forces you through a bunch of processes that will wring out the bugs and can ensure you will stand up to enterprise stress. It costs a whole bunch of money, and you do it because you want to have bullet proof software," says Jeff Jones, senior program manager, data management group, at IBM. "You don't do it just so you can announce you did it."

Many analysts don't think there was a race toward certification, but they see the achievement as an important mark for IBM.

"The importance was IBM is sending a message to the marketplace that they have a strong partnership with Microsoft, and that IBM is serious about its investment in DB2 as well as about its relationship with Microsoft," says Teri Palanca, director and analyst of database management systems at Giga Information Group Inc. (www.gigaweb.com).

Does that mean Oracle is less serious about its own 8i database? Shimp says no. He explains that Oracle customers don't view W2K certification as important issue. "Our tests are more stringent than Microsoft tests, and we will stand behind our product 100 percent. As more companies move to the Internet they are interested in scalability, much more than if we meet Microsoft certification standards. There's just no big customer demand for this."

But Palanca sees something more in Oracle's decision to not get certified. "It indicates Oracle is taking a half-hearted look at the market share. Oracle has taken its eye off the NT ball and has aligned itself with the Linux and mainframe market. We don't see announcements in the NT space as much as we once did."

This perception of Oracle may be part of what is fueling the so-called trend of users moving from 8i to DB2. "If you're a customer purchasing a database and you're serious about NT, then it might throw you toward IBM," Palanca says.

With all the talk about IBM and Oracle, where does Microsoft and its SQL Server fit into the picture? Although SQL Server was the second data base product to be certified on W2K, Palanca thinks it was a simple matter of timing that Microsoft (www.microsoft.com) got beat out by IBM.

Competition among Oracle, Microsoft, and IBM in the database market right now. And with relations between Oracle and IBM becoming almost as strained as the relations between Oracle and Microsoft, it will be interesting to see what these vendors do to boost market share.

"We have seen shifts in the market share and the rates of growth. We believe Microsoft is within 5 percentage points of Oracle in market space now. The question is will NT become as strong as Unix?" Palanca asks.

So was there really a race on to be the first database certified on Windows 2000? Probably not, but that doesn't mean there isn’t a different competition going on. For the remainder of the year Oracle, IBM, and Microsoft will continue to battle for the biggest database market share in the NT space.

"We'll have to see how it's going to be played out. It will be interesting to see what happens at the end of 2000. IBM has a high growth rate and Microsoft is close to Oracle in market share now," Palanca says. "There's a good chance Microsoft might climb over Oracle in market position by the end of this year."