RSSSurprising loss for Sun shows the heavy costs of MySQL
By Jacqueline Emigh | Published May 2, 2008, 3:19 PM
Despite his company racking up a $34 million loss this last quarter due entirely to its $1 billion buyout of MySQL, Sun CEO Jonathan Schwartz voiced optimism yesterday that its ownership of the open source database will start paying off.
During a fiscal third quarter that cost Sun's stockholders four cents per share, Sun closed the acquisitions of both MySQL and Innotek, maker of desktop virtualization products used mainly by crossplatform software developers.
"As we had expected, the overall impact of [the MySQL acquisition] on our Q3 income statement was a decrease of approximately $30 million to $35 million of net income or approximately $0.04 per share," Schwartz told analysts during this week's third quarter financial call.
"In Q4, the impact of MySQL is currently estimated to be in the same overall range as in Q3. This will reflect a near-term full quarter impact of the standalone business and ongoing amortization."
But Schwartz also promised a strong future commitment to MySQL as a key part of an overall open source platform that also includes OpenSolaris -- the open source alternative to Sun's traditional proprietary Solaris OS -- and Sun's new Open Storage Platform.
"With MySQL in particular, we found enormous receptivity to the technology and value proposition from among a broad spectrum of our customers who are already signing Sun Services agreements," he contended.
The CEO pointed to Sun customers for MySQL "ranging from Web 2.0 startups to large enterprises," specifically naming Thomson Reuters, Glasses Direct, Newforma and TimeLogic.
Also during the call, the CEO said that offering an open source OS is giving Sun a competitive edge against other large OEMs.
Meanwhile, though, some observers have suggested that presently, MySQL is most attractive to newer companies without entrenched database infrastructures, and that Sun will need to pour considerable R&D into evolving MySQL into a product will lure away existing customers of Oracle, IBM DB2, and Microsoft SQL Server.
Buyer's remorse? May be they have just realized that people on oracle, db2, and sql server aren't going to switch to mysql?
I guess their next move at communityone is to to push SAMP, solaris, apache, mysql, php?
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|I have a lot of faith in Sun and thought the acquisition of MySQL was a great move for the company. They'll turn this around, no doubt.
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|This is the company that Microsoft should be purchasing. They bring a hell of a lot more to the table than Yahoo. Scott hates Microsoft with a passion, but he also knows how to count.
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|What was surprising about it?
--->"Surprising loss"
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|"As we had expected, the overall impact of [the MySQL acquisition] on our Q3 income statement was a decrease of approximately $30 million to $35 million of net income"
Maybe that the expectations were met..?
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|What sort of person would think that by purchasing a product that is GIVEN AWAY FOR FREE would not in turn generate revenue for a company? Other than a democrat I mean?
Seriously- they knew that outlaying that kind of money for this would be a whole in the financial picture - but focusing on the long haul, I think this is a great move.
I'm betting we're going to see them start upgrading the SQL language supported by MySQL to also or only support PL/SQL. Once they do that, you'll have a whole slew of people that will be working in Oracle's flavor of SQL and when they're ready to migrate to a larger form of the DB Manager, guess which one they'll choose? The one where they can migrate their code with little to no change or one where they have to rewrite everything?
MS has SQL Express, IBM has DB2 Universal, Sybase has a developer edition that they give away for free. This is just fitting in with the rest of the players.
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|One other thing that I think you probably won't see with MySQL is any further advancement in making it more of a scalable DB. That would undercut their own system. Or - they would make it more scalable (partitioning, that sort of thing) and then they would charge for the upsell on the big kahoona.
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|Not the kind of news Sun wanted to confirm leading up to JavaOne and CommunityOne (which starts in three days, for those who are keeping count).
But it likely was a smart move for Sun to purchase MySQL for projects later down the road, so let's wait and see what happens, even if Sun has to pour tons of cash into R&D to force MySQL to evolve.
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