MESSAGE
| DATE | 2006-02-15 |
| FROM | rc
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| SUBJECT | Subject: [NYLXS - HANGOUT] Oracle tried to buy open-source MySQL
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http://www.nytimes.com/cnet/CNET_2100-7344_3-6040197.html?pagewanted=print
February 15, 2006
Oracle tried to buy open-source MySQL
Stephen Shankland, for News.com
SAN FRANCISCO--Oracle tried to acquire open-source database maker MySQL,
an indication of the profound changes the software giant is willing to
make as it adapts to the increasingly significant collaborative
programming philosophy.
Though it is increasingly diversified, Oracle's primary business is
selling its own proprietary database software. MySQL, in contrast, is a
leader among several companies trying to commercialize rival open-source
products.
MySQL Chief Executive Marten Mickos confirmed the acquisition attempt in
an interview at the Open Source Business Conference here but wouldn't
provide details such as when the approach was made or how much money
Oracle offered.
He did, however, say why he turned down Oracle's offer: the desire to
keep his company's independence. "We will be part of a larger company,
but it will be called MySQL," Mickos said.
Oracle didn't immediately comment on the acquisition offer.
The acquisition would have been a smart move for Oracle, said Redmonk
analyst Stephen O'Grady.
"It all comes back to the question of cannibalizing an existing
business," O'Grady said. "If you determine that to some extent it's
inevitable, wouldn't you prefer that you do it, instead of your
competitors?"
O'Grady said Oracle could benefit from MySQL in the way that IBM has
from its acquisition of Gluecode, a company that commercializes the
open-source Geronimo Java application server software and competed with
IBM's own proprietary WebSphere product. IBM now offers Gluecode's
software as a free product called WebSphere community edition.
"They could position it as a lower-end alternative, much as IBM has done
with WebSphere CE, recognizing that their larger accounts aren't likely
to switch from the enterprise-class database anyhow," O'Grady said. At
the same time, buying MySQL could "open up a very sizable new market for
themselves."
The database market is in the midst of major changes. IBM now offers a
lower-end version of its DB2 product for free, following similar moves
by Microsoft and Oracle. At the same time, companies such as Ingres and
EnterpriseDB are trying to build high-end open-source database packages.
MySQL, based in Sweden and Cupertino, Calif., announced in January that
it's been profitable for two quarters. But it's not turning down outside
money. MySQL announced Monday it raised $18.5 million in a third round
of funding from Institutional Venture Partners, Intel Capital, Red Hat,
SAP Ventures and Sumitomo's Presidio STX investment subsidiary.
Oracle's financial moves, however, are orders of magnitude grander. Its
major buying spree resulted in the acquisitions of Siebel Systems for
$5.8 billion and PeopleSoft for $10.3 billion.
Oracle already has bought two small open-source database
companies--Sleepycat on Tuesday and InnoDB in 2005. But its open-source
ambitions clearly are larger; for example, BusinessWeek reported that
Oracle is expected to acquire open-source application server maker JBoss.
Mickos and other executives eagerly note that the MySQL database is
gradually maturing with higher-end features, but they deny they've got
Oracle in their crosshairs. Oracle is often used in back-end databases
that power complex, massive software such as enterprise resource
planning packages (ERP) from SAP or PeopleSoft.
"We are not used in all the ERP stuff. We are adding those features, but
we are not going to be running PeopleSoft applications any time," Mickos
said. Instead, MySQL is aiming for next-generation applications at
companies such as Workday, a software-as-a-service start-up being
launched by PeopleSoft co0founder Dave Duffield.
In reality, the MySQL and Oracle do compete. "They're obviously
entrenched in different areas of the market--Oracle at the high end,
MySQL in the higher-volume, lower-end space," O'Grady said. "But is
there overlap in the middle? Sure."
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