Tag Archives: enterprise silver

Oracle Blamed for Laws of Nature

A catchy headline, and I believe more accurate than Oracle Puts the Squeeze on SMBs with MySQL Price Hike (Network World) and MySQL price hikes reveal depth of Oracle’s wallet love [MySQL Jacking up MySQL Prices] (The Register). Slightly more realistic is Oracle kills low-priced MySQL support (again The Register).

First, let’s review what Oracle has actually done: they ditched the MySQL enterprise Basic and Silver offerings. For Oracle, that makes sense. Their intended client base is “enterprise” (high end, think big corporates) and their MySQL sales and cost structure reflects this. It’s not a new thing that came with MySQL at Oracle, because MySQL at Sun Microsystems and MySQL AB before it had the same approach.

A company simply cannot operate below its market – that is not simply a matter of choice, instead it is dictated by their processes and cost structure. Smart people like Clayton Christensen at Harvard Business School have done ample research on this, here I’ll just give one simple example:

If you hire a sales person on commission and their quarterly quota is $100k, then they have to talk with clients that have at least a $10k-$20k potential (qualified leads), and they need to close (sign contract) with at least 10 within the period. They simply cannot spend any time on talking with potential $1k customers.

We may lament this state of affairs, but you can see how, given the choices made (sales person hired, commission system, quota), it’s as inevitable as an apple falling when you drop it. The way I describe this at Upstarta: if a company wants different results, they need to make sure that their business processes and cost structure lead them in that direction. But the simple fact is that most companies don’t have an internal feedback cycle that keeps an eye on these things, so they just go with the flow of consequences of common choices: aim for large(r) clients, grow turnover, get higher operational costs along the way – that in itself is a cycle and the only direction this particular one can go is up. As a natural consequence, over time old low-end offerings and clients need to be jettisoned – one way or another.

I say horay for Oracle to finally acknowledge this, since Sun Microsystems and MySQL AB before it did not (for whatever reason). This is years overdue. Whether the original MySQL company should have aimed to also serve smaller clients also is an entirely separate topic – and one which I covered at length previously (including internally in my time at MySQL AB), but it’s very much a station long passed. Once you float upward in the market, you can’t operate or move downward.

Now, are SMBs using MySQL actually getting squeezed by Oracle? They are not. There is no lock-in. This is about service contracts, not licensing. As we all know, MySQL is GPL licensed and internal use (even on a website or SaaS offering) is well within GPL parameters. There are a number of different companies offering service for MySQL, different types of service and delivery models and a corresponding wide range of pricing. So SMBs and anyone else has a choice, each can pick the type of service most suited to their needs. Let us celebrate and promote that freedom within the MySQL ecosystem, rather than being outraged about dropped apples falling!