IBM unveils DB2 for small business; Microsoft, Oracle say: "We're not impressed"

The corporate database market historically has had two distinct tiers: one in which Oracle and IBMbattle for the business of large enterprises, and a second one where Microsoft scoops up most of the sales from small and medium-size businesses.

Recently, however, the top-tier players have been making a concerted effort to capture more business at the lower end of the market. The latest example was IBM's September release of version 8.2 of its flagship DB2 Universal Database, which included two editions—Express and Workgroup—aimed specifically at the small and medium-size market.

Capable of running on UNIX, Windows, or Linux operating systems, these packages are priced as low as $624 per server, plus $124 for each named user—and that price includes a year's service.

The products also come with wizards and online advisors that IBM says will help users complete installations without relying on database administrators. "It's a big-company computing experience without the staff," says Jeff Jones, director of strategy for IBM Data Management Solutions, who also acknowledges that "there is a war going on at the low end" of the database market.

These new DB2 editions are expected to compete with Microsoft's SQL Server Standard Edition and Oracle's Database Standard Edition One, which debuted roughly a year ago. Jones says IBM actually unveiled its lower-priced DB2 editions last year as well. So far, he adds, independent software vendors looking to pair compact databases with their applications have been the most enthusiastic buyers of the new DB2 editions.

Meanwhile, both Microsoft and Oracle profess little concern about IBM's latest move. A Microsoft spokesperson says SQL Server Standard Edition has several advantages over IBM's new offerings, including the ability to run on servers with more processors—four rather than two—and built-in reporting and business intelligence tools.

Robert Shrimp, an Oracle VP, says IBM's September announcement amounts to "IBM honing features that were released [with the previous version of DB2] in an attempt to keep pace with Oracle."