What Sonys Snub of Oracle Tells Us

By Lisa Vaas  |  Posted 2006-03-20 Print this article Print

Opinion: Who cares if Oracle goes all-subscription or sticks with licensing? It's still pricey, and there are open-source alternatives popping up, as Sony Online Entertainment's switch to EnterpriseDB underscores.

Oracle may indeed be thinking of ditching its licensing model altogether in favor of becoming a pure subscription player over the coming two years, as Renee Ferguson reported on March 20. It sure wouldnt come as a great surprise, given Larry Ellisons comments at the Feb. 8 Credit Suisse Software Conference that licensing revenue "was an interesting number" but that "by far, our most profitable business is existing subscribers that renew their subscriptions every year." First Albany analyst Mark Murphy got tongues waggling afresh on the subject when he put out a note citing industry contacts that say "the wheels have been set in motion from the highest level at Oracle to do away with license sales within roughly 18 to 36 months, if possible."
Ellisons been talking about this forever. Does anybody really care besides Wall Street analysts, stockholders and resellers?
I suspect most customers simply dont. I suspect most of you agree with A.T. Kearney CIO Mike Johnson, who told me that hes skeptical that such a massive move—that database is one darn thick client to move to the subscription model, after all—could be done in a way that would benefit his company. His IT department, yes, perhaps—if you consider losing control over your Oracle database to be a desirable price to pay for not having to maintain and protect it. "Im not sure customers would be satisfied unless theres financial or other benefit," as Johnson put it in our conversation. A more tantalizing prospect for some customers is to jump off Oracle and its steep licensing fees altogether. That was emphatically underscored by the March 20 news that Sony Online Entertainment is jumping ship, dumping Oracle to move over to EnterpriseDB and its PostgreSQL-based database. Thats a big win. CEO Andy Astor was downright gleeful when I spoke with him and Sonys Vice President of Business and Legal Affairs Rick Herman last week about it. Its big because its the first Fortune 500 customer to prove the pudding on EnterpriseDBs core pitch: in other words, that the products high compatibility with Oracle can make a clean, smooth, much more affordable alternative to Oracle itself. That Oracle compatibility is going to be the companys bread and butter. EnterpriseDB just put out an update, Advanced Server 8.1, which the company announced Feb. 14 at the Open Source Business Conference in San Francisco, based on the latest version of the open-source PostgreSQL database, 8.1.2. Next Page: Exponential scale.

Lisa Vaas is News Editor/Operations for eWEEK.com and also serves as editor of the Database topic center. Since 1995, she has also been a Webcast news show anchorperson and a reporter covering the IT industry. She has focused on customer relationship management technology, IT salaries and careers, effects of the H1-B visa on the technology workforce, wireless technology, security, and, most recently, databases and the technologies that touch upon them. Her articles have appeared in eWEEK's print edition, on eWEEK.com, and in the startup IT magazine PC Connection. Prior to becoming a journalist, Vaas experienced an array of eye-opening careers, including driving a cab in Boston, photographing cranky babies in shopping malls, selling cameras, typography and computer training. She stopped a hair short of finishing an M.A. in English at the University of Massachusetts in Boston. She earned a B.S. in Communications from Emerson College. She runs two open-mic reading series in Boston and currently keeps bees in her home in Mashpee, Mass.

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