Sybase: Can It Find Its Niche?

Sybase chairman and CEO John Chen is smiling. Three years ago, a pummeling by Oracle and Microsoft left Sybase with only a 4 percent share of the e-commerce database market, and experts were wondering if the SQL Server pioneer would survive. That's when Chen arrived and got things moving.

"We're having some great success," says a beaming Chen enroute to announcing Sybase's eighth straight quarter of higher-than-expected earnings. "We credit a lot of work and a little luck in timing the demand for our SQL Anywhere software. It's used by solution providers to produce exciting mobile systems."

The mobile computing market for connecting PDAs, laptops and handheld devices to back-end servers is gaining speed. Experts agree the number of mobile/wireless devices will outpace the number of traditional PCs by 2001. Sybase's SQL Anywhere software owns 61 percent of this exploding market, according to research from Gartner Group. In response, Oracle and Microsoft recently stepped up their own mobile programs to compete, but developers have so far stuck with Sybase. "We looked at several options," says Rebecca

McKinnon, CEO of BeyondNow Technologies, a health-care company. "Our users go into patients' homes and need to retrieve and record a lot of medical data. Only Sybase has a disconnected-in-use feature, allowing our RoadNotes tablet to operate without being connected all the time. It was the best fit for us."

Other solution providers agree. "Our systems synchronize data types from dispatching to inventories to license requirements," says Brian Widell, president of trucking software company ProfitTools. For Widell, Sybase proved extremely stable. "Most of our clients don't have IT departments, so stability is key," he says.

SQL Anywhere's database synchronization lets disconnected mobile devices work as if they were connected to their servers. Recently, the mobile computing division spun off into its own subsidiary, iAnywhere.

"Our technical edge is in the software's small footprint and the SQL-with-Java [SQLJ] compiler," says Chris Kleisath, director of engineering for iAnywhere. "SQLJ makes our transmissions three times smaller than Oracle's, and SQL Anywhere developers don't have to tweak the cache and bindings as much as other systems' database administrators."

Direction Dilemma
While Sybase leads in mobile-computing software, signals are mixed about the company's direction. Unless Sybase dramatically improves its database server operations, its mobile systems' success may boost its competitors' sales. Mobile devices connect to database servers, and Sybase still holds only 4 percent of the server systems, compared with Oracle's 42 percent, IBM's 20 percent and Microsoft's 8 percent.

Also, the U.S. mobile/wireless market cannot reach its full potential until the jam-packed airwaves are reorganized for m-commerce transmissions. That won't happen until late 2002, according to the FCC.

"Right now, mobile computing can't do everything the experts are promising, at least not profitably," McKinnon warns. "Today's applications have to be for very specific uses."

Additional concerns hit Sybase's server products: For example, Linux developers perceive a lack of support. Sybase is expanding its Linux-server expertise, but the company has only one point person for Linux-server development, says Tom Traubitz, director of marketing of Sybase's enterprise solutions division.

Traubitz says Oracle's 8i product moved quickly to partner with Red Hat Linux, but adds, "Red Hat isn't the only Linux platform. We want our systems to work with Souza, Caldera and the dozens of freeware versions." Linux versions on some Sybase server products are available for download; Sybase, however, won't be promoting Linux for EAServer or ASE products until next year.

That delay in Linux promotion may cost Sybase in the mobile game. Because of its small size, Linux is the OS of choice for many handheld and wireless platforms. SQL Anywhere is Linux-friendly, but often connects to NT or Unix back-ends because developers are unaware Sybase offers Linux-server options.

"We obviously have a very active network of developers," Sybase's Chen says. "Our user groups support our [solution providers] and OEMs in a real partnership, and the network on Sybase.com has even won awards. That says a lot."

David Owen of Midsomer Consultants is a Sybase-on-Linux expert and administrator of the Sybase FAQ user group. Owen agrees with Chen. "Unlike other networks, Sybase developers are very friendly--so even new DBAs can ask basic questions without fear of getting flamed," he says.

Clearly, the company's shift toward mobile computing and improving back-end server performance is working. Keeping the momentum going won't be easy. Chen says Sybase lost ground in the past because it ignored subtle changes in customer needs. So, how will Sybase keep the lead it now enjoys? "We are the global leader in the mobile computing market," Chen says. "By empowering our solution partners, we plan on keeping it that way."