DBMS (Database Management System) market is becoming more diversified as breaks away from monopolistic structure of Oracle. DBMS market’s structure has started to change as open-source, Cloud DBMS have started to establish themselves as alternatives. Global data market is growing rapidly. As there are more businesses that select various DBMS aside from Oracle, it is expected that competitive structure of DBMS market will go through rapid change.
◊Oracle’s monopolistic structure starts to break apart
According to Gartner (based on 2016), Oracle DBMS was responsible for 45.6% (1st) of market shares globally. Although Microsoft (19.1%) and IBM (15.7%) were chasing after Oracle, its influence was huge as it was responsible for almost half of market shares. It was responsible for more than 60% of market shares in South Korea and its value was much higher in South Korea compared to foreign markets.
However, there has been a change recently to DBMS market that has been centered on Oracle. Customers have begun to look for alternatives as they go through digital transformation. Number of incidences where alternatives such as open-source are introduced has been on a rise as they have been recognized of their performance and stability.
Hyundai Motor Group that announced its plan to expand application of domestic products such as Tibero and open-source is a prime example. Reason why it is starting to put more weight on alternatives is due to their performance and cost. It announced that Tibero DBMS will be used first for its Cloud environment.
Businesses that are transforming their systems into Cloud environment are also going with other products. Korean Air announced last year that it would transform entire Korean Air systems into AWS (Amazon Web Service) Cloud. It also decided to use Amazon Aurora instead of Oracle.
Although Aurora has grown as an alternative to Oracle, Oracle does not offer open Cloud environment as it forces businesses to use its DBMS only within its IaaS (Infrastructure as a Service). Because Korean Air could not use Oracle DBMS within Amazon’s IaaS, it decided to use Amazon Aurora.
“As businesses are using various Cloud services, Oracle’s strategy can actually hurt its position within DBMS market.” said a representative for the Cloud industry. “As businesses start to transfer their systems to Cloud environment, they have no choice but to use other DBMS instead of Oracle DBMS.”
◊Oracle suffering from various variables
Oracle has been restricted due to the trade conflict between the U.S. and China.
It is heard that Oracle recently started to lay off 1,000 employees in China. According to foreign press, this decision was made by its headquarter in the U.S. Actually, decision to withdraw from Chinese market was a decision that was already made before as major businesses in China have begun to introduce Chinese DBMS instead of Oracle DBMS. As a result, Oracle started to request assistance from DBMS-related businesses in South Korea.
“There have been many requests from Oracle recently as major IT-related businesses in China have started to use Chinese DBMS instead of Oracle DBMS.” said a CEO of a DBMS-related business in South Korea. “This phenomenon of transfer to other DBMS will gain even more momentum as the trade conflict between the U.S. and China continues.” This CEO also said that businesses in Middle-Eastern countries that do not have good relationship with the U.S. have also begun to look for alternatives and that Oracle’s position in foreign market will continue to shrink.
SAP is also carrying out a plan that will shake up Oracle’s position in DBMS market. It is going to stop supporting other DBMS from its new products starting from 2025. Businesses must use SAP DBMS and this will greatly impact Oracle. Although ERP DB is one of many DBs, it is a major DB that leads corporate strategies. Number of global businesses that use ERP DB continues to increase. Most of SAP ERP customers are global businesses. It is expected that there will be more businesses that switch from Oracle DBMS to SAP ERP. In South Korea, Samsung Electronics and Hyundai Motor Group joined hands with SAP and decided to use ‘SAP S/4HANA’ that optimizes ERP into SAP DBMS HANA platform.
Oracle is also taking an active approach towards recent change in dynamic of global DBMS market. Cloud DB market has been riding a rapid growth out of global DBMS market. It is expected that Cloud DB market will be responsible for 30% of entire market in four years after being responsible for 10% in 2018. Oracle has recently strengthened its manpower and service support not to lose the leadership of DBMS market. As part of its plan, it is going to officially open its data center in South Korea next month.
“Oracle DBMS is still a major system globally.” said a representative for the consulting industry. “Although its market shares will not take a huge blow at the moment, it will be inevitable that they will start to dwindle as alternative products start to grow.”
Staff Reporter Kim, Jiseon | river@etnews.com