EC Warned Of Oracle MySQL Dangers

Former MySQL business adviser Florian Mueller and members of the EC believe that Oracle owning MySQL through its acquisition of Sun is a colossal conflict of interest, since Oracle would suddenly become the new owner of its biggest open-source competitor — one that has 6 million installations and is gaining thousands more each month.

Open source advocate, European Union policy strategist and former MySQL business adviser Florian Mueller, representing European interests in the anti-competition issues surrounding Oracle’s proposed $7.4 billion acquisition of Sun Microsystems, told a small group of journalists and analysts 26 Oct that it is very important to the IT world that the open source database MySQL remains out of Oracle’s hands.

Oracle is in the process of acquiring the MySQL code base while it trudges through the legalities of acquiring Sun in a deal announced last April 20 and later cleared of antitrust liability by the U.S. Department of Justice.

The European Commission, which serves as the antitrust arm of the 27-nation EU, won’t sanction the deal if it perceives an antitrust problem, and Oracle needs this blessing in order to do business in Europe.

Mueller and members of the EC believe that Oracle owning MySQL through its acquisition of Sun is a colossal conflict of interest, since Oracle would suddenly become the new owner of its biggest open-source competitor — one that has 6 million installations and is gaining thousands more each month.

This conflict is becoming more problematic by the day for Oracle, the world’s second-largest software company, because the EC wields a great deal of power in this area.

The Redwood City, Calif.-based database software and middleware maker needs to make a big decision as soon as possible: Shall it continue to fight for MySQL, or not?

“Oracle is a high-priced cash cow in the parallel database business. Why then should it be the one entity that controls development, determines revenues, and controls an R&D budget of a competing product [MySQL] that it sells against directly in the database market?” Mueller told the press conference 26 Oct.

“It is legally possible but not viable [for Oracle] to be an innovative competitive force [by owning MySQL].”

Oracle CEO and founder Larry Ellison doesn’t see it this way at all, saying at the recent Oracle OpenWorld conference in San Francisco that “MySQL in no way competes with our databases. It has its own market and following. The main competitor is Microsoft [SQL Server], and that’s okay by us.”

Mueller said he thought it was interesting that Oracle spoke up to say that MySQL doesn’t compete with its own products only after the EC issued questions about the topic in a report published Sept. 3. Ellison has since been quoted as saying that Oracle “will invest even more in MySQL than Sun did.”

“In fact, Oracle in a FAQ on its Web site [immediately after the Sun acquisition was announced on April 20] stated that MySQL was only going to be an ‘addition’ to its database product line. It didn’t say anything about investing more until the EC came out and questioned this,” Mueller said.

“Oracle’s promises about investing in MySQL are not relevant. Oracle won’t be the turkey that votes for Christmas.”

The ultimate answers to all this are yet to come — from Oracle, from the regulators, from Sun, and from the MySQL community, Mueller said.

The EC has set a date of 19 Jan, 2010, to make a final decision whether to sanction the deal, although a determination could come sooner than that.

Mueller’s purpose Oct. 26 in a meeting here at the Westin Hotel was to “explain positions of critics of the proposed transaction in the lion’s den due to strong Wall Street interest in the matter.”

Mueller is a former MySQL shareholder and business adviser to former MySQL CEO Marten Mickos, who is now at Benchmark Capital as Entrepreneur in Residence in Silicon Valley. Mickos, however, does not share Mueller’s opinions on Oracle and MySQL and has said publicly several times that Oracle would be a good home for the database and its community.

Mickos wrote a letter on 9 Oct to EC Competition Commissioner Neelie Kroes explaining why he is not concerned with Oracle owning MySQL.

Mueller also is an author, entrepreneur, consultant, and the founder of the NoSoftwarePatents.com campaign.