Unix Database Sales
techweb.com
Part of the article:
Dataquest, in San Jose, Calif., reported
that the Unix relational database market
was virtually stagnant from 1996 to 1997 at
$2.1 billion. Meanwhile, NT grew to $872
million from $456 million in the same
period. That is a 91 percent growth rate.
And it is no longer starting from a tiny
base, a situation that skews growth figures.
Redwood Shores, Calif.-based Oracle
[profile], which broke out platform sales
for the first time, said Unix platform
growth was a paltry 2 percent vs. 130
percent for Windows NT. NT databases
and tools, in fact, were behind its
much-touted turnaround in the last quarter.
But the two companies that built their
businesses on Unix -- Sybase and Informix
-- saw their revenue fall. Through either
luck or foresight, Oracle made a massive
early effort on NT on both the sales and
technology sides, which is now paying off.
Although vendors do not like to admit it,
some say pricing pressure as much as
declining unit volumes are bringing the
Unix market down. While list prices of
Unix databases have remained constant,
some VARs and analysts said the average
client price has dropped due to aggressive
deals with customers and ISVs such as
SAP America and Baan.
According to Jim Ewel, group product
manager at Microsoft, in Redmond,
Wash., analysts have told him that his
competitors' Unix price per client has
dropped to the low $300s. "We do believe
their average revenue per unit has been
going down. They could be selling more
units at lower prices," he said. And
Informix chairman Robert Finocchio
recently said price competition in the ISV
market has become cutthroat.
"There has been some price compression,"
said Mitchell Kertzman, Sybase's
chairman. But he said some deals are
platform-neutral, meaning there is equal
pricing pressure on NT.
In any case, the slowing Unix market -- and
growing NT market -- will mean a change
in how databases are sold. For VARs, that
will be both a good and bad thing.
On the plus side, there will be more
channel sales and VAR training, a la
Microsoft. Oracle has taken the lead in
many respects with its NT Solutions
Group and the closely tied-in channel
programs. But IBM [profile], in Armonk,
N.Y., is also rapidly expanding its
BESTeam program to include training and
support for DB2 for NT. Expect both
Informix [profile], in Menlo Park, Calif.,
and Sybase [profile], in Emeryville, Calif.,
to step up Windows NT channel efforts.
On the downside, Unix tends to be a
higher-margin sale.
Chief information officers often drive the
decision for an NT platform, regardless of
technical merits, according to Greg
Herrera, director of sales at Millennia
Vision, an Oracle VAR in Mountain View,
Calif.
"We have both Unix and NT expertise. ...
Right now a lot of CIOs think that NT is
the safe choice. If SQL also becomes the
safe choice, we will have to think about
looking at that [SQL Server]," Herrera
said.
Jeff Worthington, a principal at Icon
Solutions, in Philadelphia, said lower
administration costs cause many
organizations to stick with NT as the
underlying platform.
But VARs said that despite the NT herd
mentality, it is crucial to lead customers
toward Unix solutions in large
environments because it is still more
scalable and reliable. In other words, if a
mission-critical application comes crashing
down, the VAR's reputation is on the line.
Or the vendor's. Sybase's Kertzman knows
that all too well, which is why he still
recommends Unix for most mission-critical
environments.
"I've heard from people who say my
mainframe breaks down once a year, my
Unix system once a quarter, and my NT
server needs to be rebooted twice a day,"
said Kertzman.
In other words, Unix is not on the floor yet
and reports of its death are greatly
exaggerated. |
