The 2005 worldwide relational database (RDBMS) market was approximately $14 billion in revenue (IDC estimates $14.6 billion while Gartner, Inc believes it was $13.8 billion) and experienced a healthy upper single-digit growth (IDC 9.4% increase vs. Gartner’s 8.3% increase.)  It has been said many times over the last decade that RDBMS growth would slow significantly and that the market was saturated, but the industry continues to underestimate the demand created by business, competitive and governmental data-driven initiatives. Businesses crave data (actually information) to monitor, measure and engage in performance management. It is no longer a nice-to-have, but a must-have in order to compete and operate in today’s business climate.

Colleen Graham, principal analyst at Gartner, says “The market will also experience increased demand from organizations buying relational database management systems for business intelligence and data warehousing activities.” IDC states that "Data warehousing remains a major driver of RDBMS growth."

The top RDBMS by market share are Oracle, IBM and Microsoft. The latter’s share had been increasing before its latest release SQL Server 2005. Microsoft is “moving up the food chain” (paraphrased from IDC) by being able to handle increasing workload and sophistication. Microsoft is enabling RDBMS to be pervasive in the SMB (small-to-medium business) market, as well as putting pricing pressure downward in the Fortune 500 market. Open source RDBMS is attracting attention but has yet to make a significant dent in the marketplace other than adding to the pricing pressure from Microsoft on the other database giants.

It is also interesting that the two “surviving” databases, Teradata and Sybase, (each with single digit market share) offer terrific data warehousing appeal.

My outlook for the future:

·        Microsoft will increase its market share by increasing the size of the overall market, but not by displacing Oracle or IBM in existing applications (see migration below.)

·        RDBMS pricing will continue to be pressured downward by both Microsoft and open source.

·        Open source RDBMS may expand the marketplace, but is not likely to displace any of the RDBMS behemoths. Many applications that previously used a file-based system or Microsoft Access may migrate to open source, but mainstream uses such as DW or BI are not likely to see widespread adoption. Although open source RDBMS may be more than adequate to do many database tasks, who is going to push for their use? Oracle DBAs who are “spoiled” with tremendous functionality and have great (and marketable) skills are not very likely to drop either for open source.

·        Migrating from one database (that works very well) to another is a very costly proposition that I can’t see widespread adoption of by businesses or the IT groups within them. Businesses are not going to pay for projects that add no business value (and arguably reduce it) simply to save money on licensing fees. These cost reductions are insignificant when compared with the costs to migrate, retrain and support a new RDBMS. And if you add in the opportunity cost (lost) for the time to migrate it may not make sound business sense. If you factor in software support, or lack thereof, for open source RDBMS it’s tough to imagine business critical applications moving widespread in that direction. (Note: You can always get some companies to do anything and proclaim it as a success, but widespread adoption is not likely.)