Sun to fork out $1 billion for open-source firm MySQL

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Sun to fork out $1 billion for open-source firm MySQL

文章 #1  未閱讀文章PoP » 2008-01-17 16:01

Source: http://www.news.com/8301-10784_3-9851644-7.html?part=dht&tag=nl.e703

Sun Microsystems will plunk down $1 billion to buy MySQL, the maker of a popular open-source database.

Sun said Wednesday that it will pay about $800 million in cash for MySQL's privately held stock and will assume about $200 million worth of options. MySQL CEO Marten Mickos will join Sun's senior executive team after the transaction closes.

The acquisition is a bold move for Sun, which has embraced open-source software and development practices in an effort to garner more revenue from its software business. Until now, it has sold support services for a competing open-source database, PostgreSQL.

Company executives said they will continue to support PostgreSQL and continue to partner with database giant Oracle.

MySQL, founded in 1995, is one of the most successful open-source companies. It's part of the popular combination of open-source development products referred to as LAMP, for Linux, Apache Web server, MySQL and the PHP development language, which is broadly used on the Internet and within companies.

Mickos had previously said that the company intended to go public rather than be acquired.

Its business model is to give away the source code and its database for free and to charge customers an ongoing subscription fee for support and services. Speaking during a conference call, Sanford C. Bernstein analyst Toni Sacconaghi said he estimated MySQL's revenue over the past year was in the $60-$70 million range.

In the call, Sun CEO and president Jonathan Schwartz called the deal the most important acquisition in the history of the company.
Sun will gain access to MySQL's large customer base and have the opportunity to sell hardware and addition software, he said. About 75 percent of MySQL installations run on hardware from other vendors than Sun. About 20 percent of them run Sun's Solaris operating system, although the majority of MySQL databases run on Linux, executives said.

"This is really about one thing: reaffirming Sun's position at the center of the Web," Schwartz said. "We view ourselves as a platform for the Web economy and we certainly believe and can demonstrate that we have the hottest products and platforms."

In his blog, Sun CEO Jonathan Schwartz said that Sun will begin offering support services to customers of MySQL before the deal closes later this year.

He said that Sun intends to provide the sort of support services that large corporations demand.

MySQL is a "part of every Web company's infrastructure, to be sure. And though many of the more traditional companies use MySQL (from auto companies to financial institutions to banks and retailers), many have been waiting for a Fortune 500 vendor willing to step up, to provide mission critical global support," Schwartz said.

Schwartz also outlined a number of areas of technical integration designed to optimize MySQL's flagship database--as well as MySQL's Falcon storage engine--on Sun's Solaris operating systems and servers.

A new benchmark for open source

The size of the acquisition, at $1 billion, reflects the indelible mark that the open-source business model--in which companies give away source code and charge for services or high-end products--has left on the software business.

"I think that open source is becoming the business model that enterprises want to pursue...and there are legions of software engineers graduating from college who won't use anything else," said Kevin Harvey, general partner at Benchmark Capital and chairman of MySQL's board. "Open source and software-as-a-service are the only two viable software business models going forward."

There are plenty of open-source start-ups, but few that have reached the size and influence of MySQL. Most of the successful open-source companies have been acquired.

Novell bought SUSE Linux four years ago for about $210 million. JBoss was acquired for more than $400 million by Red Hat in 2006. And last year, Citrix paid $500 million for XenSource, a virtualization software provider, and Yahoo paid $350 million for Zimbra.

"This is a great move for Sun, and answers the question of 'SunDB' that Scott McNealy posed several years ago," said The 451 Group analyst Raven Zachary.

However, the acquisition also comes with some potential difficulties. "This raises a whole bunch of issues concerning Sun's close ties to Oracle, as well as their investment in PostgreSQL," Zachary said.

He believes other potential suitors include Red Hat, Sybase, Hewlett-Packard, and Oracle. Indeed, Mickos confirmed in 2006 that Oracle had attempted to acquire MySQL.

MySQL, which is based in Cupertino, Calif., and Uppsala, Sweden, has about 400 employees. Investors include Benchmark Capital, Index Ventures, IVP, Intel, SAP, Red Hat.

The deal is expected to close near the tail of Sun's fiscal third quarter, which ends in late March, or early in its fourth quarter.
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註冊時間: 2006-12-06 03:42

Sun closes MySQL deal

文章 #2  未閱讀文章PoP » 2008-02-27 14:05

Source: http://www.news.com/8301-13580_3-9879251-39.html?part=dht&tag=nl.e433

Sun Microsystems said Tuesday that it has completed its acquisition of open-source database company MySQL for about $1 billion--and now is turning its attention to other acquisitions.

"In my view it's the most important acquisition in Sun's history," Sun Chief Executive Jonathan Schwartz said on a conference call Tuesday.

Sun paid about $800 million in cash and $200 million in stock for MySQL. Although it's a big open-source acquisition for the server and software company, it won't be the last, Schwartz said.

"Those companies that have built good high-integrity communities, broad distribution, and some measure of commercial success are those we're going to be interested in," Schwartz said, and there are many that fit that bill. "We believe we're a natural home to a lot of them, and we're going to be putting our balance sheet to work to make that the case."

Marten Mickos, who had been MySQL's chief executive, now is senior vice president of Sun's database group, reporting to Rich Green, Sun's executive vice president of software.

MySQL may have been Sun's most important acquisition, but it wasn't its biggest. In 2005, Sun spent a net amount of $3.1 billion to acquire StorageTek, a tape storage system maker with a large customer base and revenue stream.

Schwartz wouldn't compare the merits of the two acquisitions, but indicated that MySQL has a strong potential: "The customer base it brings to Sun measures in the millions if not the tens of millions. There are very few companies on Earth that have that capacity to create opportunity for Sun," he said.

Mickos estimated that there are 12 million instances of MySQL installed at present. It's impossible to know exactly, since copies may be downloaded for free and distributed any number of ways.

Sun still will support Derby, PostgreSQL
With the new title, Mickos will lead not only MySQL work, but also other open-source database projects that Sun supports, including Derby and PostgreSQL. Sun will continue its work with those projects, Green said in an interview.

"We fully intend to keep those programs going at the same speed as we did before," Green said. Developers want different packages for different situations, and "Sun is big enough to have more than one going at the same time."

However, MySQL is clearly the priority. For example, the sales support will be much broader than with PostgreSQL when it comes to selling MySQL support subscriptions, Green said.

"Those subscriptions will be sold by the entire Sun software sales force. We've amped up the scale and reach of the sales organization that previously was a much more limited size," Green said.

Schwartz argued the acquisition will make MySQL more palatable to big customers. "The single biggest impediment to success in the marketplace (has been) their comparative inability to provide peace of mind to enterprises that want global service and support," Schwartz said.

For his part, Mickos chose to look at the potential rivals more as allies. "I believed always the enemy is not another open-source database," he said. "We always had a good relationship with the PostgreSQL team."

PostgreSQL is often positioned as more of a traditional database package comparable to Oracle's dominant and proprietary product. MySQL, while steadily accumulating more features useful for that area, has been geared more for what the company has seen as new database usage such as new-generation Internet sites. MySQL is used at the core of Facebook, Google, and YouTube.

Mickos said Sun doesn't plan to move MySQL more toward the traditional database market. "We're following Wayne Gretzky's advice: skate to where puck will be," he said, mentioning "Web services, Web 2.0, telecom, and mobile spaces" as examples.

Faster development, and eventually GPLv3
Being part of Sun will speed development of new features such as Falcon, MySQL's project for a new storage engine used within the overall database, Mickos said. "We now get access to abilities and resources we didn't have before--scaling, performance, memormy management, input-output. That's why we hope to be able to accelerate the road map."

It won't change MySQL's multiplatform approach, though; the database runs on Linux, Windows, Solaris, AIX, Mac OS X, and many other operating systems.

MySQL is governed by version 2 of the General Public License (GPL) since 2000, but the company likely will move to GPLv3, Mickos said.

"We've been part of drafting GPLv3. We like the license. We think it's better than GPLv2 and takes care of some of its weakeness," Mickos said. "But (GPLv2) is the most successful license ever. It will take time to replace it and to move over to next generation, GPLv3. I believe we'll do it at some point, but we haven't decided on a specific point in time yet."

Update 9:15 a.m. PT: I added more details about Sun's acquisition plans. Update 10:30 a.m. PT: I added more information about Sun's acquisition history, MySQL integration details, and licensing and product plans.
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