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Commentary: Buying database market share

The announcement that IBM is acquiring Informix's database business is less about Informix and more about IBM's attempt to compete head to head with Oracle.

    By Betsy Burton, Gartner Analyst

    The announcement that IBM is acquiring Informix's database business is less about Informix and more about IBM's attempt to compete head to head with Oracle.

    IBM is buying market share in the realm of Unix database management systems. Traditionally, the strength of IBM's database product line (DB2) has been on the OS/390 and OS/400 operating systems--not on Unix or Windows NT. In recent years, as Informix and Sybase have struggled to maintain a position in the Unix database market, and as IBM has become more dedicated to its Unix DB2 offering, IBM has slowly been able to grow its market share. With this purchase, IBM is attempting to secure a larger percentage of Informix customers--many of whom are already considering migration to either Oracle or DB2.

    For the last two years, meanwhile, Informix has been lagging in technology innovation and marketing focus. In addition, it has lost many of its leading engineers and visionaries. As a result, many customers have complained about weaker technical support and a decrease in support from independent software vendors.

    This purchase is a double-edged sword for Informix customers. With this announcement, IBM plans to consolidate the DB2 engineering, sales and marketing teams under the leadership of Janet Perna. This will give Informix customers a sense of security that the product will be supported by a stronger and more stable company than the stumbling Informix.

    On the other hand, while IBM announced plans to continue support and marketing for Informix's database applications, Gartner believes that the company will move aggressively to drive Informix users over to DB2. This means that sometime over the next 18 to 24 months, most Informix customers will have to incur the costs of migrating to DB2.

    See news story:
    IBM to purchase Informix unit for $1 billion
    Although this acquisition helps ensure that a reasonable percentage of Informix customers will migrate to DB2 over the next 24 months, the migration will not happen without risk for IBM. First, the company has to figure out how to assimilate 2,500 Informix employees with the more than 4,000 workers already in IBM's database applications division (an increase of 62 percent). In addition, Informix supports more than six different database products.

    To succeed, IBM management will need to be focused. Managers must quickly determine which Informix products to use and which to get rid of. Swallowing so many people and so many product lines at once, IBM could, if it is not careful, find itself with a serious case of indigestion.

    (For related commentary on databases, see TechRepublic.com--free registration required.)

    Entire contents, Copyright ? 2001 Gartner, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.