Oracle To Slice Price On Standard Edition One, Weighs RAC Bundle
For the new Oracle 10g Standard Edition One release, the company will drop per CPU price to $4,995 from $5,995, sources said. And it will enable customers to run that database version on two processors. The current Oracle 9i Standard Edition One is limited for use on one-processor servers.
The database kingpin is also weighing a move to include limited real-application cluster (RAC) support, for up to two nodes, in Oracle 10g Standard Edition, which will likely retain its list price of $15,000 per processor. The Enterprise Edition will also hold the line at $40,000 per CPU, sources said.
The RAC option currently costs $20,000 per CPU but the company had been selling clustering for months at a 50 percent discount, cutting clustering costs to $10,000 per processor. That "limited-time" discount lasted well beyond its expiration date.
The Linux version of the 10g database is expected to ship this week, to be followed by the Windows version. Oracle could not be reached for comment.
Both moves are indeed big news for a company fighting a fierce database battle against IBM DB2 and Microsoft SQL Server.
Betsy Burton, an analyst at Gartner Group, said that if true, the inclusion of RAC in the standard edition would be a step in the right direction. However, Oracle's "real opportunity to set the world on fire would be to bundle two or three nodes of RAC with the Enterprise Edition," she said.
Oracle positions SQL Server as a competitor only in the low-end and that is no longer true, Burton said. "SQL Server runs a lot of enterprise applications," she said.
The current Oracle 9i Enterprise Edition lists for $40,000 per CPU without the RAC options. Microsoft SQL Server Standard Edition lists for about $5,000 per processor, the enterprise version at $20,000 per processor.
A source close to Oracle with knowledge of the moves lauded these plans and said over time Oracle will move more optional, and separately priced, features into the standard database SKU. "RAC, partitioning, etc., will all eventually end up in there."
Microsoft partisans say that company's tendency to bundle capabilities,business intelligence, OLAP etc into the core database has been a key selling point for SQL Server.
The whole notion of Oracle price cuts has been a hot potato for the company. Last fall at OracleWorld, CEO Larry Ellison said to expect imminent price cuts on the database. That never happened. The company eventually came out with the Oracle 9i Standard Edition One SKU, ostensibly to combat SQL Server. But price on the mainstream standard and enterprise editions remain unchanged.
Competitors and observers say Oracle has always been somewhat slippery on pricing. "They did a 50 percent limited-time price promotion on RAC years ago that never went away," said Tom Rizzo, director of product management for Microsoft SQL Server. That is a fact even Ellison acknowledged last October.
Earlier this week Oracle President Chuck Phillips reportedly said Oracle 10g will come in at the same per-CPU price as SQL Server. He did not specify any particular SKUs however, and no one expected the company to drop the Enterprise Edition price.
Ellison himself has waged a public battle to go to some kind of usage or utility-based price model that would supercede per-user or per-CPU prices.
In addition, many observers say current Oracle list prices are meaningless given what happens in the field.
Microsoft's Rizzo said, "When it comes to Oracle, no one pays less. They already discount below SQL Server today in much of our competition," he said.
But Oracle tends to charge separately for functionality that is standard in competitive databases, according to both IBM and Microsoft.
Oracle executives have long maintained that the company's embrace of Linux and inexpensive Intel "blade" servers has bled total cost out of Oracle solutions.