SQL Server Delays Roil Solution Providers

This database, code-named Yukon, has slipped so much it's becoming "a credibility issue," said one East Coast solution provider who requested anonymity, as did several other interviewed for this story.

A West Coast Microsoft partner agreed, and said the continued and serious slippages out of Redmond are casting a favorable light on open source development as an alternative model.

That alone is serious a problem for Microsoft, but product delays are also exacerbating volume licensing issues. Companies who sign volume license pacts with Microsoft expect a certain number of upgrades within a pre-set period, and many now feel they are not getting their money's worth.

"This is evidence of the benefit of the open source model. For critically important software, an open source end-user can have access to incremental releases, analogous to beta/alpha, and may not have to wait for the vendor's planned release," he said.

In contrast, Microsoft alone determines the features and dates of its releases. "An active user of open source software can invest and have more control of what software they use and when they start using it," he said.

Other partners were still evaluating plans in the wake of Microsoft's acknowledgement Wednesday that next-generation SQL Server will be SQL Server 2005 and will not debut until that year. Likewise, the closely linked Whidbey release of Visual Studio is slipping from 2004 until 2005. (See story.)

"We need to assess the impact of the Yukon delay for our clients. We are lining up some smart client solutions and were counting on Yukon features to augment the occasionally-connected user stuff, along with some programming ability in Whidbey," said a New York metropolitan area solution provider.

Anytime a major IT infrastructure provider delays an anticipated upgrade, it sets off a chain reaction, said Joe Lindsay, CTO of eBuilt, a Costa Mesa, Calif., solution provider. It may help customers who need more time to upgrade, but "for folks badly needing the new functionality, it can be very bad news," he said.

For developers, the tandem Yukon and Whidbey delays underscore the danger of relying too much on one vendor and may play well in IBM Software's attempts to woo ISVs. One of IBM's main arguments as to why it is a safer infrastructure partner than Microsoft is that its support for J2EE and open standards means there will be alternative technology sources should IBM renege on partnership promises. Such may not be the case for Microsoft-only shops dependent on that company's code drops.

"Early adoption of Yukon in enterprises was quite strong due to the functions and features and the slip could change that," said Steve Chan, vice president of business development for Ziplip, a Mountain View, Calif., ISV specializing e-mail management and archiving.

Because Ziplip develops for J2EE as well as .Net and partners with IBM and Microsoft, the company is somewhat insulated, he said. "We deploy on a variety of platforms. If you look at it biologically, being more diverse protects us," he said.

Microsoft's other database rival was not shy about taking some credit for the SQL Server woes. Oracle chairman Larry Ellison told analysts Thursday night that the delay was at least in part due to Oracle's 10g database launch earlier this year.

"I think [Microsoft is] trying to respond to what we've done in grid computing. I don't think it's easy--we've erected a huge technical barrier here. We deliver much better performance than Microsoft can at a competitive or lower cost, we have much better reliability and much better security," Ellison said on the company's third quarter earnings call.

Indeed, Oracle struck a blow at Microsoft earlier this year when it offered up a version of its database for essentially the same price as SQL Server 2000.

Some think Microsoft has bitten off more than it can chew with Yukon. "This product lacks focus," said Betsy Burton, analyst with the Gartner Group. "They're doing all sorts of stuff with it, first scalability was the issue, then XML support, then .Net activities, and then business intelligence and now security. The gut issue is, what is the purpose of this release? As a team trying to develop a product you have to know where you're going," she said.

Burton and others also said that this slip could further antagonize companies with Microsoft volume licenses and who count on a certain number of major upgrades within the span, typically three years, of their contract.

"With Longhorn, Yukon delays and [Software Assurance] agreements, we're finding customers who are looking at their investment in SAs and trying to figure if they're getting their value back," Burton said. While Microsoft has tweaked the agreements a bit to make them more attractive, "if you're a company who bought in the beginning, you bought to get upgrades and there are many customers right now who signed up for SAs early and have gotten no upgrades."

Some observers even maintain that Microsoft is willfully delaying products to spur companies to renew volume licenses. They point out that even Microsoft CFO John Connors has stated he has no idea how many current Upgrade Assurance and Software Assurance licensees will renew and say there is growing anxiety on Wall Street around that issue.

Microsoft dismisses talk of intentional delays out of hand.

"I can categorically squash those rumors. There' s no conspiracy; this is all about quality," said Tom Rizzo, director of product marketing for SQL Server.

Elizabeth Montalbano and Paula Rooney contributed to this story.