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6/1/2006
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Growing Volumes Of Data Fuel Database Software Sales

Microsoft gains on Oracle and IBM, but open-source databases are growing in popularity.

Worldwide sales of relational database software and services grew 8.3% to $13.8 billion in 2005, fueled by businesses' need to manage their rapidly growing volumes of data. The recently released market numbers from Gartner also showed that Microsoft's SQL Server database continues to gain market share from chief rivals Oracle and IBM.

Gartner said sales of relational database products would continue to grow through at least 2010, given that data management and integration have become more strategically important within many businesses. While transaction processing remains the principal application for relational databases, increased use for data warehouse and business intelligence activities is also fueling growth.

IBM, Microsoft, and Oracle—the database market's three leaders—all reported sales growth in 2005. But Microsoft's double-digit growth to nearly $2.1 billion was enough to increase its share of the market to 15% from 13.9% in 2004. Oracle's $6.7 billion in database-related revenue accounted for 48.6% of the market—down from 48.9% in 2004, but still enough to remain the market leader. IBM remained in second place with just over $3 billion in database sales, accounting for 22% of the market, down from 22.4% the year before.

Teradata, Sybase, and other smaller vendors accounted for the rest of the market. Gartner reported that while total sales of open-source database software remained small last year, that product category showed the fastest growth.

Gartner also reported that the use of Linux as a database platform grew 84% last year, largely driven by sales of Oracle's database software for Linux and the growing acceptance of Linux as a mission-critical operating system. Sales of mainframe-based database software also continued to grow, even outpacing Unix database sales.

While Gartner has traditionally counted only database software license revenue in tracking the relational database market, the rise of open-source software and the growing use of hosted database products has forced the market analysis firm to rethink that position. Gartner's market numbers now include revenue from new license fees, updates, subscriptions and hosting, technical support, and maintenance.

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