Tuesday, February 12, 2008

IBM's RDBMS Strategy

Oracle is, at heart, a database company. IBM is not. Relational databases form a relatively small fraction of IBM's overall revenue:

Sources: IDC, Company 10-K Filings and Annual Reports. Backup

IBM sees relational databases as one component of a strategy that emphasizes large and complicated IT solutions for business customers:

The company’s strategy is to focus on the high-growth, high-value segments of the IT industry. The company’s broad capabilities include services, software, hardware, fundamental research, financing and the component technologies used to build larger systems. These global capabilities are combined to provide business insight and solutions in the enterprise computing space.

Source: IBM 2006 Annual Report, p. 12

If relational database systems commoditize enough, I wouldn't be surprised to see IBM jettison its proprietary RDBMS business. IBM has demonstrated a willingness to prune its business portfolio, by spinning off or selling businesses that don't fit the above strategy.