January 16, 2008

Sun Picks Up MySQL For $1 Billion; Open Source Is A Legitimate Business Model

Michael Arrington

73 comments »

mysql.pngThe big news this morning is that open source database startup MySQL finally found a year’s worth of rumors that they were mulling over an initial public offering. Sun Microsystems has acquired them instead, for $1 billion. MySQL had raised a total of $39 million from Benchmark, Index, IVP, Intel, and SAP.

Sun CEO Jonathan Schwartz wrote about the acquisition on his blog, lavishing praise on MySQL: “MySQL is by far the most popular platform on which modern developers are creating network services. From Facebook, Google and Sina.com to banks and telecommunications companies, architects looking for performance, productivity and innovation have turned to MySQL. In high schools and college campuses, at startups, at high performance computing labs and in the Global 2000. The adoption of MySQL across the globe is nothing short of breathtaking. They are the root stock from which an enormous portion of the web economy springs.”

Startups with similar business models - managing a free open source project and bolting for-pay services on as a business model, will be happy to see this. Wordpress and OpenAds are two that we follow closely.

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Comments

FlyerTalk Beta Male - January 16th, 2008 at 9:19 am PST

Open Source a legitimate business model? LOL. RedHat much?

Open Souce is a legitimate way to make cash for your investors at least!

 

Congrats to MySQL. This is a remarkable achievement for an open source company and a confirmation of the value in the business model.

Roy
Magento - Open Source eCommerce
http://www.magentocommerce.com

 

Going public was a better option for open source community.

I hope Sun won’t disturb current situation of this brilliant open source software with it’s own policies.

 

Sun finally find something to make some noise in the Web2.0 era. How’s that Sun Grid thing doing, btw?

 

Yes, a wonderful day, and a milestone achieve IMO — OS cannot be ignored by the bigwigs any more.

BTW, hey @Roy (magento), congrats on what looks like a remarkable OS e-commerce package — I will be looking into it deeply in 2008.

Peace.

 

Wow, $1B exit on $39M investment? A 25x return is really good, but I wonder if they would have fared better in an IPO.

This is a great buy for Sun, though the terms ($800M cash, $200M options) really magnify the relative weakness in Sun’s market position. They needed to do something like this, lest they begin to look less relevant to the world with each passing day.

Here’s to hoping for a good corporate integration. (no pun intended)

 

How come there are no Windows binaries for a 1 Billion worth product?

 

This just goes to show you how retarded the $15 billion valuation of Facebook is.

 

Fireball what the hell are you talking about.

http://dev.mysql.com/downloads.....html#win32

 

Did you not get the memo? OSS has been a legitimate business model since the RedHat IPO.

Also, if you can make sure there’s a cover sheet on your TPS reports from here on out we’d appreciate it.

Thaaaaanks.

 

Sun’s this $1B buys “its role as the largest commercial open source contributor“, per http://www.mysql.com/news-and-.....mysql.html

Nice little spending to shut some people up.

Now there’s some good reason to let them say to themselves, “let’s forget about Java (and embrance LAMP!)”.. for that matter, buy PHP too — is it ready for sale — Like Mozilla’s anytime we-are-ready?!!

Considering Yahoo’s $350M for the little known Zimbra, $1B ($800M cash) for MySQL is pretty good deal (for Sun).

 

Will the open source community that helped develop this (and others) be compensated in the deal (and any other deals)? If not, one has to wonder about the Karmic payback, to say the least.

 

Now comes Sun’s next big (enterprise customer) problem: Oracle is going to rip them to shreds in terms of how software is released and marketed when it comes to the Linux/UNIX market. Case in point: when Redhat bought JBoss, Oracle got pissed; and although Oracle’s support of Redhat did not necessarily waiver, their marketing of Oracle-on-Redhat did. With so many of Sun’s largest customers (especially in government) running Oracle-on-Sun, I wouldn’t be surprised to see some of them jump ship at Oracle’s recommendation.

 

I’m not fan of Duncan. He’s spinhead idiot.
I like Mike Arrington post much better.

 

I moved from mssql (asp.net) to mysql (LAMP) about 3 years ago…

how much profit has mysql stripped from Microsoft? do you think it is close to $1B?

 

@ozzy - Thanks for the kind words!

 

Well, there goes all the wonderful web hosting startups. What’s that? You want to run a LAMP setup? That’s gonna cost you 0.004 cents per query.

Wait, that’s right. There’s this database alternative that is more powerful, faster, and more flexible. It’s called PostgreSQL (http://www.postgresql.org/). If you don’t know, you better ask somebody.

 

@Technicle

You are mixing a lot of unrelated things.
1. MySQL doesn’t exclude Java, quite the opposite.
2. PHP isn’t for sale. The business model of MySQL [that was sold] revolves around enterprise licensing and enterprise support. Zend is the company that is intertwined with PHP, and offers enterprise services.
3. Rasmus Lerdorf, the creator of PHP, is a Yahoo! employee. And we I worked with him at Yahoo! he and Brian France, another core engineer, seemed pretty happy.
4. Are really comparing Zimbra to MySQL? At the time I left Yahoo! they were mid-transition to what appeared to be an internally developed groupware suite. I don’t know if it was Zimbra based, or if they chose to switch to Zimbra, or if the experience of developing groupware from scratch made them realize the value of Zimbra. Regardless, comparing those 2 is about as obscure as comparing iTunes to the Linux kernel. (Even Kevin Bacon would say, “How are those 2 connected?”)

 

Sun has a history of overpaying and then destroying great companies after acquisition. Just a couple come to mind that I was involved with. July 1998 - NetDynamics - developers of the NetDynamics Application Server. September 2000 - Cobalt Networks, an Internet appliance manufacturer. This company should have gone IPO and remained independent of Sun. I’m a huge fan of MySQL and would hate to see it fall apart.

 

@ilovebonnie.net

I am a DBA at my company and all morning people have been asking my take on this. I keep telling them that PostgreSQL will keep Sun from doing anything stupid. Especially with the way so many web frameworks abstract the DB away with an ORM… Most of the current MySQL users, maybe less so with the biggest, would have no problem jumping ship if it catches fire. That’s why we chose FLOSS in the first place.

 

With…Long run… and same old…. same old words. Frustration.

Hey, Mike.
Do you get boring writing. More VC rises.. More VC rise.. More VC rise?
What’s stopping you always?
The article tells us.

$1 Billion. What else? Is there any innovation? Is there Killer App? Is there something better than Apple thin crust Laptop?

 

@RichardBronosky

Well, things originally unconnected could be connected simply by someone paying.. eg., BEA is now connected to Oracle by $8.5B, just as simple as that!

 
 

Thumbs up to this good news.

 

Hey technicle.

Why choose technicle domain name?

It sounds like testicles…testicles…testicles..testicles..testicles..testicles..testicles..testicles..testicles..testicles..testicles…

 

Sun = google acquisition bait

 

S/he maens two sey, “Technical”.

 

It will be interesting to see how this turns out. Seems like a good move for Sun, but a good move for MySQL? I guess we’ll have to see.

 

@RichardBronosky

For why the mention of Java and PHP, read the Sun/MySql’s along with my that comment (which again, http://www.mysql.com/news-and-.....mysql.html) and you’ll perhaps understand of why their mentions.

Or more explicitly:
1. need some “reaffirmations” by using MySql (because Sun’s Java is not getting attention)
2. LAMP, M is MySql, P is PHP, as you know, and they say they now have the M.
3. Zimbra comparison, common practice.. note my mention of the “little known” keyword (compared to the 100 Million+ downloads of MySql, how many did Zimbra have? 10? 100? — thus, in that sense, the attention per unit cost efficiency, in web2.0 terms)…

 

A simple question- Why?
As the saying goes “Don’t confuse motion with action”
mySQL doesn’t yet get very serious enterprise attention (outside the internet world). That’s the realm of oracle, sql server and db2.
Is Sun trying to make money from small to medium sized businesses selling their overpriced boxes?
A year from now, they’ll not be happy about it.

 

@justin, oracle isn’t going to be worried one bit about sun’s acquisition of mysql. oracle’s market share is massive relative to mysql’s, and whatever growth sun tries to help mysql with will in no way step on oracle’s turf in any significant manner that they will even notice. they both cater to opposite sides of the db market and oracle will never open source its core database or go after the web 2.0+ market.

sun, of course, caters to startups and massive edu/gov/financial institutions and so they’ll be focusing on selling broader sun offerings to existing mysql customers and bringing enterprise support to those larger institutions that are *already* using mysql under the table for certain projects.

 

Far beyond the viability of Open Source as a business model, MySQL puts Sun at the nexus of a variety of convergences, while Oracle’s acquisition of BEA is betting on a fading horse.

More on my blog:

http://smoothspan.wordpress.co.....s-throats/

Best,

BW

 

@testicles..

Thanks.. no comment :-)

 

I could care less about this right now.. I am still so upset at the Data Portability Group. Breaking down that kind of wall is bad for capitalism.

 

Forget about the Data Portability Group. I took back my previous urging people to join it. It has become an elite group of people. Want to be heard? Build your own billion-dollar enterprise first.

 
 

How many companies are against open source database?

 

select m from lamp where java=”forgotton” and php=”notforsale” order by billions limit 1;

 

Congrats My sql (and open source in general). I think open source will have some meaning at the end of the day if some body acquires and further develops it.

import javax.mysql. :)

 

First of all, congrats to the MySQL team. Second, I am more of a PostgreSQL guy. Stopped using MySQL 8 years ago.

 

I am ‘for’ the aquisation. Congrats to MySql. As Sun chief said they have been doing great.

 

Unfortunately Sun themselves hasn’t been doing great… being at $13B market cap, is not even half of a new company like vmware ($31B).. or visually — http://finance.yahoo.com/q/bc?.....=m&q=l

 

brilliant - Sun is back.

 

Being an OpenSource company, who gets to keep the money?

 

…Sun is back [to 1997].

 

stay the Mozilla Foundation and Mozilla Corporation..

 

>stay the Mozilla Foundation and Mozilla Corporation..
study the Mozilla Foundation and Mozilla Corporation..

 

Interesting that TC is still not banning my posting access. :-D
Feel a little shameful to be like advertising here.. so let me sign off for a while!

 

Smart move, Amazon’s SimpleDB will only grow and dominate as the choice for internet based startups, and that will spread from there. Nobody wants the headache of managing/scaling a DB arch.

 

and lastly, re @44, regardless of @47 (non-profit/for-profit dual), simple example being you can simply set up your RP Open Source Inc and open source your products.. if people contribute great, if not, Zimbra didn’t have a lot of contributors (compared to mysql and linux etc).. the gist being, those contributors are mere volunteers and thus they get $0 and you get to keep all your money when your o.s. company becomes sold.

 

Cudos to the MySQLAB and the hardworking decade+ community. Interesting to see SUN finally did something to catch a fresh breather, hope they will make use of it rather than burn it with likes of Netscape, Cobalt etc.

With INNODB storage engine owned by Oracle, and MySQL owned by SUN - it will be interesting to see how things shape up in the near future. Needless to say the newer entrants like falcon will have a lot of mixup on this entire story.

Dear SUN, where are you heading next? Ubantu, Caldera, may be :-)?

 

Hopefully Sun will release a java frontend for mysql databases because of the acquisition.

http://www.webepags.com

 

This is huge news. I had no idea this was coming!

 

Seems like a good time to be working for an open source software company like Appcelerator.

 

what was MySQl valuation? What is their revenue? How do they make money?

 

If Mysql was bought by another company other than Sun the free software community can worry but Sun has the credibility congratulations.

 
 

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