Database start-ups bet on open source

By Martin LaMonica
Staff Writer, CNET News.com

Published: August 10, 2005, 4:00 AM PDT

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Following the gradual acceptance of Linux, open-source databases are moving into corporate data centers as an increasingly viable option.

Databases have been available with an open-source license for many years. But the past few months have seen a growing number of partnerships and products aimed at maturing the industry of add-ons and support services--vital to winning over corporate customers.

At the LinuxWorld conference this week in San Francisco, MySQL signed partners Novell and Dell to resell the upstart company's database and support service, making the product easier to procure. MySQL is also readying a release of its namesake database with features including stored procedures and distributed transactions, which large corporations often use.

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In the past few months, a handful of companies--Pervasive Software, Greenplum and EnterpriseDB--have sought to build businesses around the PostgreSQL open-source database, which has been around for about 20 years and is considered very mature. One of those upstarts, EnterpriseDB released on Tuesday its first product, detailed its pricing plans and said it intends to raise its first round of venture funding later this month.

Last week, three companies joined to create a package of open-source database-related products for business intelligence applications. And the Apache Derby database last week shipped its first version and gained Sun Microsystems as a distributor.

The growing number of technology companies betting their businesses on open-source database products reflects a gradual shift in corporate spending patterns, according to analysts and industry executives. With many companies familiar with Linux, the Apache Web server and open-source development tools, databases are an obvious next step.

"Customers are paying a lot of money for an Oracle or IBM or Microsoft database license, and they are very cost-conscious. To some extent the database is a commoditized layer, and they're asking themselves 'Why are we paying money for a commoditized layer?'" said Michael Goulde, an analyst at Forrester Research.

A Forrester survey found that more than two-thirds of corporate customers are using open-source products in some way. The research company estimates that spending on open-source databases was about $120 million last year.

Often, developers bring in an open-source product for a single project and then the usage spreads. Indeed, open-source databases are still a small sliver of the overall relational database industry estimated at nearly $15 billion last year, according to IDC.

Different tacks
Still, usage of these alternatives to entrenched database providers appears to be growing. MySQL boasts having 6 million installations, along with 1,500 MySQL-related open-source projects at SourceForge and a growing network of partners, which help distribute the company's product and services.

Large corporate customers, such as Sabre Holdings and PriceGrabber.com, have built their back-end systems around large farms of relatively cheap hardware servers running MySQL.

MySQL's distribution partnerships with Novell and Dell will broaden its