Sybase defends enterprise plans
Hoping to quash rumors that it's moving away from its core enterprise database business, Sybase plans to roll out a new version of its high-end database.
The database maker will on October 6 announce the shipment of its Adaptive Server Enterprise database, version 11.9.2, which includes some long-promised features, such as row-level locking, needed to support enterprise resource planning packages from PeopleSoft, Baan, and other makers, according to a source close to the company.
Spotty support for enterprise resource planning software has been a drag on the company's revenue growth. Database market leader Oracle has in recent years reaped huge profits by supplying the underlying database software for enterprise resource planning systems.
At the event next month, slated to take place on Wall Street, Sybase executives are also expected to announce additional details on its Financial Server application server, which enters beta testing next quarter.
The specialized server is tailored to banks, insurance, and financial services companies that need to integrate a variety of applications. It's also the first of several planned servers, specialized for particular vertical industries, that Sybase intends to launch in the coming months.
Sybase executives are hoping to stifle rumors that its recent focus on the mobile and embedded computing market, with new low-end database and connectivity software, means that the company is giving up the battle on the enterprise front.
A recent report from Giga Information Group, which detailed the comments of several large Sybase customers that have made long-term commitments to Sybase's database, found that there is concern that Sybase appears to be moving away from its corporate customer focus.
Some customers have voiced concerns that the company is attempting to exit what's seen as a stagnant market for enterprise database software in favor of building a lead in the still-growing mobile database market.
A Sybase representative said the concerns are unfounded and that continuing to target the enterprise market is still high on the company's agenda.
But the market may be moving past Sybase. The company is having difficulty winning new customers, analysts said. Earlier this week, Merrill Lynch lowered its estimates for Sybase's earnings per share for the rest of the year, due mainly to fears that the company is struggling to bring in new business and is cutting deals on software licenses.
Merrill lowered per-share estimates from a loss of 25 cents per share to a loss of 35 cents per share for fiscal year 1998, and stated that "increased competition from stronger rivals Oracle and IBM...continues to exert pricing concessions from the company."
Melissa Eisenstat, an analyst with CIBC Oppenheimer, said that Sybase and Informix Software, which is also struggling, could be swimming against the tide in the high-end database market. "In terms of momentum in the enterprise database market, it probably goes to Oracle, not to Sybase or Informix. Sybase will not win the war against Oracle," she said.
That could explain why developing software for mobile computing and embedded systems has become one of Sybase's primary businesses.
In fact, Sybase's Adaptive Server Anywhere database, the company's small footprint database, contains some technology, such as Java support, that has yet to be included in the company's enterprise offering.
The company promises that the next version of Adaptive Server Enterprise, due sometime next year, will offer support for Java stored procedures and storage of Java data objects.
Sybase management has stated that mobile computing is one of three areas on which the struggling company will focus in coming months. The other areas include data warehousing and Web computing. The company is also adding professional services personnel in an effort to increase its revenue derived from consulting.
Sybase executives chose Wall Street for the database rollout to illustrate its continuing support among financial firms, which were among the first to adopt Sybase's technology and drive the company's meteoric growth in the 1980s.
To further demonstrate its commitment to the enterprise market, Sybase will next month announce a new research and development center focused on enterprise technology, a company representative said.