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Why Larry Ellison Doesn't Want To Spin Off MySQL

The fate of MySQL has been top of mind since Oracle agreed to acquire Sun Microsystems earlier this year for $7.4 billion. Will Oracle spin it off, treat it as a strategic asset or let it die a slow death?

Well, Oracle CEO Larry Ellison this week finally shed some light on that question during an interview by none other than Ed Zander, who was once president and COO of Sun. Ellison made his remarks during the interview, at The Churchill Club, a non-profit Silicon Valley forum.

"We're not going to spin it off," Ellison told Zander (video courtesy of TechPulse360).  "The U.S. government cleared this, we think the Europeans are aware we are not going to spin it off." As reported earlier this month, the European Commission said it is investigating the deal based on concerns about the impact it will have on MySQL. The move came just weeks after the U.S. Department of Justice approved the deal.

"MySQL and Oracle don't compete," Ellison said. Rather Oracle competes with IBM's DB2, Microsoft's SQL Server and databases from Sybase and Teradata, among others.

Forrester analyst Noel Yuhanna  believes MySQL could become a strategic asset to Oracle. "MySQL has become a major force and a threat to Oracle and Microsoft," Yuhanna said in an email. He points out that companies like Facebook, Twitter, Google, Skype, Safeway, Comcast, and others that are already a major users of MySQL.

"And many others are considering looking at making it part of their database strategy, including some large Fortune 100 companies," Yuhanna noted. That said, MySQL fills an important gap in Oracle’s market, which is in the small to medium sized applications, where Microsoft SQL Server has dominated for years, he added.

"We believe MySQL will be positioned against SQL Server and also offering a migration path to Oracle databases, so this acquisition, especially MySQL, is critical for Oracle and I am sure Microsoft is watching is very closely."

And perhaps in this case Microsoft is in the ironic position of routing for the European Commission?

What's your take? Drop me a line at jschwartz@1105media.com or post a comment below.

Posted by Jeffrey Schwartz on 09/25/2009 at 9:03 AM


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