Gartner: IBM takes database market lead

With its database user group’s annual conference on tap in San Diego this week, IBM Corp. got some good news to tout: Gartner Inc. said it inched ahead of rival Oracle Corp. in the database market last year.

Stamford, Conn.-based Gartner last week released its worldwide database revenue numbers for 2001, which showed that IBM had US$3.1 billion in new licence sales vs. Oracle’s US$2.8 billion.

IBM’s lead was achieved partly as a result of its July acquisition of Informix Corp.’s database operations in Menlo Park, Calif., according to Gartner’s report, which was issued by its San Jose-based unit Dataquest Inc. Despite that deal, Oracle retained the top spot in the relational database portion of the market.

But both IBM and Microsoft Corp. saw revenue increases and gained market share at Oracle’s expense in the relational segment, as well as in the overall market, noted Gartner analyst Colleen Graham. At the same time, Graham said, Oracle’s database sales dropped 5 per cent from 2000 levels.

Betsy Burton, another Gartner analyst, said many users have questioned Oracle’s pricing and licensing policies.

“Oracle has a reputation of being costly and very, very tough to negotiate with,” Burton said.

IBM’s mainframe database business grew 5 per cent last year, Gartner said. In addition, the Informix purchase helped IBM snag new customers for its DB2 relational databases, according to the report.

Oracle’s Rebuttal

Meanwhile, Microsoft is exploiting the perception that its SQL Server software is the low-cost database of choice, Graham said. That’s “an alluring message to fiscally strapped enterprises,” she said.

Oracle struck back against the Gartner report, calling the market share numbers questionable and claiming that IBM’s and Microsoft’s revenue totals should be validated by an independent auditor.

Rene Bonvanie, vice-president of Oracle9i database marketing, said Oracle saw “phenomenal growth” in database sales before the dot-com crash and the economic slowdown. In turn, he noted, it was the first vendor to feel the pinch when IT budgets shrank. But he said Oracle has strategies to help it recover market share, such as a sales migration program aimed at Informix users.

Michael Schiff, an analyst at Current Analysis Inc. in Sterling, Va., said IBM, Oracle and Microsoft dominate the database market and will fight among themselves for leadership again this year. “The database wars continue, despite the fact that people may claim [to have won] a battle,” he said.

James Niccolai of the IDG News Service contributed to this story.