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Market research gives Oracle top database spot

IDC said Oracle maintained its lead in the database market over IBM last year. Oracle had more revenue overall, though another report pointed out that IBM led in new sales.

Martin LaMonica Former Staff writer, CNET News
Martin LaMonica is a senior writer covering green tech and cutting-edge technologies. He joined CNET in 2002 to cover enterprise IT and Web development and was previously executive editor of IT publication InfoWorld.
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Martin LaMonica
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A market research report on database sales last year found that Oracle has the most market share and that revenue from databases overall grew slightly last year.

The report, published by research company IDC on Friday, found that Oracle's share grew 8.6 percent, giving the company nearly 40 percent of the market for relational and object-relational database management systems. IBM's share grew 5.5 percent to 31 percent of the total market, while Microsoft's share grew 14.7 percent to represent 12.1 percent of the database market.

IDC's ranking of top vendors is different from the list produced by research firm Gartner, which published its own market numbers two weeks ago. Gartner Dataquest found that IBM maintained its lead in the database market in 2003, while Oracle was in the second position for market share.

The discrepancy stems from how IDC and Gartner define the size of the market: IDC counts revenue from new licenses sold during a year plus ongoing license fees charged to customers. Gartner only counts new license revenues.

When IBM sells its mainframe database, it charges for a license to use the software as well as for maintenance, whereas other database vendors have separate contracts for the license and for maintenance, said Carl Olofson, the author of the IDC report. Figuring in Oracle's maintenance fees, combined with new licenses, gives Oracle more revenue overall than IBM, he said.

"(Mainframes) is where IBM reported growth for the most part," Olofson said. "Linux was the fastest-growing, but it wasn't as significant, overall."

Revenues for the entire database market reached $13.5 billion, according to IDC figures, which represents a 7.6 percent increase over 2002. But adjusting for a strong euro compared to the U.S. dollar, the market would have grown at roughly 2 percent in constant currency, Olofson said. The market's size declined 2 percent from 2001 to 2002, IDC said.

Olofson said last year's growth indicates that corporate customers are spending more money on information technology. Businesses' big-ticket purchases, such as databases, usually indicate that they are trying to ramp up their computing capacity.

Sales of databases on Linux grew faster than Windows did last year, while sales of Unix databases shrunk, Olofson said.