Interview: MySQL rides open source wave into DBs

SAN JOSE, CALIFORNIA — Since its founding in 1995, MySQL has managed to establish itself as the provider of the best-known open source database on the market and hopes to dent the armor of big name vendors such as IBM, Oracle, and Microsoft.

With a product that lacks many features found in software from those top vendors, the Swedish company is aiming at a slice of the database market that it sees as commoditized, where companies can use a low-cost product like MySQL for everyday needs. Meta Group Inc. analyst Charlie Garry has called it “the wildcard in the competitive $12 billion database market.” Challenges include attracting applications and tools to its platform, overcoming apprehensions about open source at corporations, and cracking a mature market that is widely viewed as a three-horse race.

MårtenMickos, MySQL’s chief executive officer, sat down with IDG News Service for an interview at the company’s first user show last week in San Jose, California. He talked about how businesses can use MySQL, its competitors, and why the Nordic region might be a cradle for open source products.

IDGNS: You’ve said your goal isn’t to displace vendors like Oracle and IBM but to exist alongside them. How should businesses think about using your software?

MM: The typical customer has plenty of, say, DB2 installations, and they come to us and say, Couldn’t we use you in some of those instead? Today those applications are typically Web sites, Web applications and intranets, that’s one area. The second area is administration — network administration, authorization, database log-in, and also logging data, for systems management. The third area is data warehousing, where you have masses of data being dumped in and out. Then we are at the edge of the enterprise. We’re not a typical datacenter database today but we are a good fit at the edge — at the departmental level and in remote locations. That’s where you can use us.

We all know that for DB2 and Oracle installations, the lifecycle is long and they are typically not replaced often, and we are not saying they should be.

IDGNS: Should we think of you as the Red Hat of the database market or are you a different type of company?

MM: Yes and no. Red Hat is the most popular Linux distributor, we are the most popular open source database. We both built our business on open source. Then we get to the “no” part. We are the owners of our source code. We offer the dual licensing system that I presented here. So we have a business model that is different from Red Hat. We sell licenses, that’s part of building up our business.

IDGNS: So a customer can download your product for free, in which case they have to share any improvements they make with others, or they can pay a license fee, in which case they can keep their modifications to the software to themselves. Is that right? How much is a license?

MM: That’s right. The license is $440 per server. It’s a flat fee, there’s no charge per CPU or per user.

IDGNS: You don’t do any advertising, how did you build up such a large base of users?

MM: We’ve been honest to our customers about what we can and can’t do. We haven’t set false expectations. And we’ve been prudent and said no to some things that seemed attractive but that may not have been the right thing to do.

IDGNS: Like what?

MM: Adding a feature too early, or venturing into an area of software we don’t want to do. People know they can trust us. We’ve fixed bugs immediately, we’ve thanked people publicly who helped. That’s the sort of business people want to see succeed.

Also, from an economic standpoint we’ve managed to devise a way of producing and distributing software that is much less costly. That means we can pass on savings to customers. You can compare this to what Dell did with PCs. Michael Dell said, I know how to assemble this and sell it at a lower cost, I sell direct. He could sell the same goods at a lower price and people loved it.

IDGNS: He could do that because PCs became a commodity. Have databases become a commodity?

MM: That is our assumption. Being a commodity market is not a black and white issue, it’s about proportions. You say, how much of the database market is a commodity, and we say, whatever is a commodity, that’s where we’ll act. There will always be a non-commodity segment too and that’s fine, we’re not making any claims there.

IDGNS: There are some new developments happening in databases, with vendors adding more support for XML and other specialized capabilities. Will you not address those changes because they are not part of the commodity market?

MM: We are never on the bleeding edge, but we are fast movers. We hadn’t spent millions on .Net thinking, but when we decided to get into it we immediately created a .Net interface and were the first non-Microsoft database to have that available. That’s how we deal with any new technology. We take our time, but once we move, we move fast. XML will clearly be an important standard in the future and for us it is a tactical decision when to provide that functionality.

IDGNS: What are you doing to attract more applications to MySQL? Are there any big ERP or CRM packages available for MySQL today?

MM: That will all come over time. If you look at the typical profile, we started as a Web database so Web applications were the start, content management systems, logging systems, network management systems, that’s where we have our biggest installed base. We are also embedded in various products. Since about half a year ago we have seen more traction on the business applications side.

IDGNS: Who are some of your biggest customers and how are they using MySQL?

MM: Yahoo has 400 real time, mission critical applications running on MySQL. It started at Yahoo Finance where they have a publishing engine that pumps out news stories. That runs on MySQL, and now they’ve expanded to many other Yahoo properties. Yahoo UK runs entirely on MySQL. The FIFA World Cup site also runs on MySQL. The (Sept. 11) memorial site runs on MySQL.

IDGNS: Has Yahoo replaced instances of Oracle or IBM, or are you running alongside them?

MM: Yahoo is an Oracle shop as well. That’s a typical situation. Our best successes are typically in companies that also run Oracle or IBM or Microsoft and then bring us in where it makes sense.

IDGNS: How many paying customers do you have now compared to a year ago, and where do you expect to be in a year’s time?

MM: We had roughly 3,000 a year ago, and we have 4,000 now. It is growing rapidly so, if we added 1,000 last year we’ll add roughly 2,000 to 3,000 this year.

IDGNS: A big concern for business customers is the availability of support services. As the number of paying customers increases, how will you maintain an acceptable level of support?

MM: I’d say it’s easier for us to provide worldwide support than for some of the big vendors who are struggling with heavy infrastructures that hamper the deployment of support services. I think our model scales better than theirs. We’ve been providing 24/7 support since 1999.

IDGNS: So will you add new support staff as you get more customers?

MM: We’ll grow the staff, we’ll also use systems to automate the tracking of (support incidents), we’re already doing that. Selling support is a high margin business for us.

IDGNS: How about certification programs for database administrators?

MM: We just launched a certification program a few weeks ago that’s now up and running. It’s offered worldwide.

IDGNS: You have about 70 staff today. How many do you expect to have in a year?

MM: The full company will probably be more than 150.

IDGNS: You say you have about 4 million installations of your product worldwide, but only around 4,000 paying customers. Is your goal to increase the proportion of paying customers, and how will you do that?

MM: Our goal is not linked to the proportion at all, we want to grow in absolute measures. One goal is to grow our business with paying customers, the other is to grow the free user community. Whether the proportions go up or down is irrelevant.

IDGNS: You said in your speech (at the user show) that your sales and customer base both tripled last year. Are you profitable?

MM: We are now breaking even so, on a quarterly basis we are profitable. Last year was not a profitable year, that’s something we decided on. We had a much better bottom line than we had planned for, but we had (not planned to be profitable). We are well funded so there’s no concern there. We brought in some venture capital and we haven’t used it yet.

IDGNS: What will you do with the product over the next year? Are you adding features to make it more attractive for big business customers?

MM: If it is a commodity market then the same product will serve all customers, so that is a moot question. But we are adding features that people have been asking for — stored procedures, triggers, views, things like that. Those are needed by enterprises.

IDGNS: Are those features planned for Version 5 of MySQL, and when is that coming out?

MM: Yes, we’ll have 5 out as a developer version this year, then it can take half a year to a year for us to put it in production, and then it is really durable. Some of our customers use it before we dub it “production.” We are very conservative about calling something a production release. You should see the first version 5 deployments in the first half of next year.

IDGNS: You and LinusTorvalds both are from Finland. Is that a coincidence or is there something about that country that makes it fertile ground for open source software?

MM: It probably is a coincidence, but there’s fertile ground for open source in the whole Nordic region. Finland, Sweden, Norway, Denmark, Iceland — it’s a region that has some of the oldest schooling systems in the world and where high education is the norm. Openness is also the norm; all government and public offices have open records. And the harsh climate has forced people to work together to get things done, so the community approach is nothing new. Maybe they are not coincidences.

Linus and myself come from the same very small ethnic minority in Finland, that probably is a coincidence. But I think he went to the wrong university. (Laughs) I went to Helsinki University of Technology and he went to Helsinki University. That’s like the difference between Berkeley and Stanford.

IDGNS: What are your goals at MySQL for the coming year?

MM: We are working on enhancing the product, we are working on adding services and features. You’ll see a constant improvement and expansion on all frontiers.

IDGNS: Will they be new types of services or more of what you already offer?

MM: New types in terms of consulting services, provisioning services. We have done support and training for a long time, now we’re adding more consulting services.

IDGNS: Is that because you’re attracting a different type of customer?

MM: Precisely. If you look at the technology adoption lifecycle written about by Geoffrey Moore in “Crossing the Chasm,” it’s clear that at the beginning you have the enthusiastic, highly skilled people, then you get more into the mainstream, customers who’d rather spend the money (on services) and save the time.