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Can Sun Make MySQL Pay?
AlexGr submitted a nice followup to last weeks billion dollar Sun buyout of MySQL. He notes that "Jeff Gould presents an interesting analysis in Interop News:
How can an open source software company with $70 million or so in revenue and no profits to speak of be worth $1 billion? That's the question Sun CEO Jonathan Schwartz has been trying to answer since he bought MySQL last week.
Like most commercial open source companies, MySQL makes money by enticing well-heeled customers to pay for an enterprise version of its product that comes with more bells and whistles than the community version it gives away for free.
It appears though that the additional features of the Enterprise version are not enough to compensate for the revenue-destroying effects of the free Community alternative. What else could explain the surprising fact that MySQL has quietly filled out its open source portfolio with a closed source proprietary management software tool known as Enterprise Software Monitor?"
He misses the most obvious way of making Mysql pay and that is Java. If Sun goes down the same route that Microsoft is with Sql Server/.NET and integrates Java into Mysql, Sun gets a powerful new platform for the enterprise.
I've pondered this as well. What makes Youtube worth ~1.5 billion? Certainly not the technology. Sun has bought developer mindshare. When you think MySQL now, you're going to associate it with Sun. As long as they don't destroy it, it will reflect well on a company that, till now, has been floundering.
According to Torvald's biography, Linus walked out of a meeting in the 90's that Sun had called with the open-source community because the license they were introducing didn't pass his muster. It is interesting to see Sun coming around.
Of course, I could be totally wrong and we could be looking at a storm on the horizon.
Customers don't pay for MySQL professional because it's not that great of a database. As a "free" option, there's tons of support for it. It was seen early on as "the" database for OSS work. As a result, nearly every OSS tool in existence is built around MySQL.
However, if we're talking about someone looking to pay for support, we're probably talking about a business of some sort. And for businesses, features like ANSI syntax, transactions, reliability, scalability, tools, familiarity to the DBAs, and a strong reputation for customer service are all factors that play into their decision. Why would they purchase MySQL when options like SQL Server, Oracle, DB2, Informix, Pervasive, Teradata, and half a dozen other RDBMSes with stronger reputations in the market are available?
While MySQL has made great strides in their progress toward becoming a competitor in the Enterprise market, it's a bit of an uphill battle that they're going to have a hard time winning. The market sees MySQL as an OSS toy that children play with before they grow up and use a REAL database. Changing that perception is going to be hard.
Worse yet, it's a race against time before powerful new competitors like Apache Derby (formerly Cloudscape) start pushing MySQL out of the market.
That being said, I wish I invented an "OSS toy". A billion dollars as compensation sounds like a rather sweet deal.
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