"Wow!"

The E-mail from Jim Gray, a distinguished engineer with Microsoft Research, had just that one word in its subject line. Contained within was a link to a benchmarking study showing a Hewlett-Packard system with a massive 8 terabytes of disk storage running Microsoft software, including its relational database-management system, SQL Server. At an impressively low price point in transaction throughput, it's the kind of evidence that validates everything Gray has been working toward since he joined Microsoft seven years ago from Digital Equipment to develop a low-cost, highly scalable system capable of handling data-center workloads.

For less than $1 million, the eight-CPU system chewed through 110,000 transactions per minute. "This is the kind of thing I was hinting at," Gray wrote in the message, sent earlier this month. "This is mainframe performance and engineering at commodity prices." Gray admits a $900,000 system isn't everyone's idea of a commodity, but the cost is, at minimum, "half the cost of competing systems."

	Microsoft is aiming to provide mainframe performance, Gray says.

After years of working behind the scenes to improve the features, reliability, and scalability of the database software that's joined at the hip with Microsoft's flagship Windows operating system, Gray and his counterparts on the SQL Server development team believe the system is on the verge of a performance breakthrough. A 64-bit version of SQL Server is due early next year, timed to coincide with Microsoft's 64-bit operating system, Windows .Net Server, and the growing availability of servers equipped with Intel's 64-bit Itanium chips.

A major upgrade to SQL Server, code-named Yukon, will begin testing in the first half of next year. The revision will include improved capabilities for building big data warehouses as well as enhancements to bolster SQL Server's traditional strength--ease of use--at the lower end. For instance, database programmers will find it easier to use their language of choice in development, and administrators will get a uniform set of tools for managing the database and its accompanying online analytical processing engine.

The improvements have been a long time coming. Next month marks the 10-year anniversary of Microsoft's entrance into what was then a crowded, hotly contested market for relational database-management systems. By steady improvements to SQL Server, and by hitching the product to the coattails of Windows and Microsoft's network of developers, the vendor has steered its way into the No. 3 position in the $7.1 billion relational database market, with 14.4% share in 2001, according to research firm Gartner. As the years went by, Microsoft surpassed Computer Associates, Informix, Sybase, and more than a dozen other database suppliers through low cost and its distribution channel.

Today, Microsoft sells four databases: a desktop version of SQL Server, as well as the server version; FoxPro 7.0, which is part of its FoxPro application development environment; and Access 2002, which is part of the Office XP application suite. Microsoft got into the relational database market with Sybase's help back in 1987, when it negotiated the right to co-develop and resell Sybase's system. The deal ended after seven years, and Microsoft took over full-time development of its own version of the platform.