SQL Server 2005 at 6 Months

• By Scott Bekker
• May 22, 2006

Microsoft hasn’t come out with customer adoption details, and sales figures from Microsoft’s financial statements since the launch have been strong but not substantially different from SQL’s steady quarter-over-quarter growth in recent years.

In general with SQL Server 2005, Microsoft is trying to grow beyond its commanding position as the database of choice for small and medium-sized businesses into a stronger enterprise presence – an area where Oracle Corp. and IBM Corp. lead. Microsoft’s strategy to take SQL Server further into the enterprise market consisted of expanding and adding business intelligence features that enterprise customers formerly paid for in addition to their core database investments.

So far, Microsoft has shown respectable growth. For the most recently ended financial quarter, which ended March 31, Microsoft reported 30 percent growth in SQL Server revenues. Double-digit growth in a product which accounts for more than $1 billion in revenues for Microsoft per year is important, but it’s not an order of magnitude above SQL Server’s performance in prior quarters. Despite years without a new release, SQL Server has continued to post steady double-digit gains in revenues.

With such a long testing and development phase, Microsoft actually has a fair number of customers running SQL Server 2005 in production. Already, the company has more than 130 reference customers posted in the case study area of the SQL Server Web site. Internally, Microsoft has been running the database on production systems for years.

At the same time, there are some hints in the channel that the new business intelligence capabilities aren’t catching on with enterprise customers.

“It’s just been slower than we thought,” said an executive with a large systems integration firm who asked not to be identified. “The analysis and reporting piece has not driven adoption the way that they thought. The business intelligence tools baked in are just not becoming the standard. Companies are still throwing other business intelligence solutions on top of that.”

A different Microsoft partner, Wilton, N.H.-based Edgewood Solutions, conducted a survey of IT professionals just before the launch of SQL Server 2005 last year. In the survey, Edgewood found that 55 percent of large organizations, 45 percent of medium-sized organizations and 50 percent of small organizations planned to wait at least a year before adopting SQL Server 2005 on high-impact systems.

Microsoft is putting the final pieces in place for more customers to begin adoption. One of the most highly anticipated new features was database mirroring, which was only formally turned on for production use with the release of Service Pack 1 last month. SP1, meanwhile, is a traditional checklist item in enterprise shops considering Microsoft products. Many customers won’t begin evaluating a Microsoft technology for deployment until the first service pack is released. Waiting for SP1 has become a less common practice as Microsoft’s quality control and pre-release testing have improved over the years. The service pack didn’t include any security fixes, for example. Yet with a goal of pushing SQL Server 2005 to enterprise customers, a longer sales cycle could be a new reality for Microsoft’s SQL Server business.