Oracle's biggest database foe: Could it be Postgres?

Deutsche Bank analyst Karl Keirstead wants to soothe Oracle that it needn't fear the open-source reaper, arguing that open-source databases "don't represent a near-term threat" to Oracle's database lead.

Though Keirstead is right that NoSQL databases like MongoDB and DataStax's Cassandra may merely nibble at Oracle's lead, primarily finding purchase in new applications, old-school Postgres may be another matter.

That is, if a new Postgres survey conducted by EnterpriseDB is to be believed. While it has been evident for years that Postgres is undergoing a serious renaissance, it's harder to believe that it's chewing into core Oracle deployments. That said, if any database could threaten to replace Oracle in applications being refreshed by enterprises tired of paying Oracle's eternal maintenance fees, it's Postgres.

Hegemony isn't what it used to be

Once upon a time, Oracle could dismiss open-source databases as test and development toys that couldn't compete when it came to mission-critical production. Unfortunately, reality hasn't been kind to that supposition.

Gartner, for example, forecasts that more than 70% of new in-house applications will be developed on an open-source database by 2018, and that 50% of existing commercial RDBMS instances will have been converted to open-source databases or will be in process.

In other words, open-source databases are almost certainly cutting off Oracle's oxygen when it comes to new applications, but it may also be cutting into its hegemony within existing workloads.

If true, that's new.

Though from a biased source, an EnterpriseDB survey of Postgres users certainly suggests that Postgres users are running the venerable open-source database for increasingly mission-critical workloads, including those that used to pay the Oracle tax:

• 55% of users—up from 40% two years ago—are deploying Postgres for mission-critical applications
• 77% of users are dedicating all new application deployments to PostgreSQL, and 37% reported they had migrated existing applications from Oracle or Microsoft SQL Server to Postgres
• 37% of PostgreSQL users expect to gradually replace their legacy systems with Postgres, compared to 29% in 2013
• End users predict their deployments of Postgres will expand significantly, with 32% saying they anticipate production deployments of Postgres to increase by at least 50% over the next year.

That's a lot of new Postgres deployments. Nor is it particularly surprising, given that 41% of those surveyed report they had first-year cost savings of 50% or more. While big data applications are naturally going to gravitate to MongoDB, Cassandra, and other NoSQL databases, Postgres is carving out its place as a like-for-like replacement of Oracle, DB2, and other traditional RDBMSes.

Or is it? In many ways, these Postgres numbers seem too good to be true. For example, some longtime Oracle users have turned to Postgres as a bargaining chip in negotiations with Oracle, without serious intention to switch, as was the case with Salesforce.com.

This will only hurt a lot

And yet... something is clearly going on.

In its latest earnings miss, Oracle blamed currency valuations for its poor performance. But this is just one miss among many. It's actually becoming difficult to remember the last time Oracle nailed earnings estimates for two consecutive quarters. Over the last few years, it has missed more than it has hit earnings.

Over the years, Oracle has blamed sales execution, currency fluctuations, and other factors.

What it hasn't blamed, but Bloomberg has, are open-source databases: "The impact [of open-source databases] shows up in Oracle's sales of new software licenses, which have declined for seven straight quarters compared with the period a year earlier."

Bloomberg points to startups that have almost entirely forsaken Oracle as a source of Oracle's weakening new license sales, but startups have never driven the heft of Oracle's earnings. It's much more telling, as the article points out, that giants like Goldman Sachs are eschewing Oracle for open-source databases. As its co-head of technology told Businessweek, "It's hard not to go into our datacenter and see a tremendous amount of open source running our applications and middleware."

There are good reasons to believe an enterprise's next database will be open source—and not just any open-source database, it would seem, based on the Postgres survey data. With Postgres, enterprises don't need to learn new query languages or alternative ways to structure data. They don't sacrifice functionality and can get equal or better performance as Oracle.

Oh, and the price? Nada. Zilch. Zero.

Jobs data suggests Postgres is hot with the startup crowd. But with excellent performance and Oracle-esque functionality, it's not surprising it's heating up with enterprise customers, too. And while the EnterpriseDB survey may overstate just how fast this is happening, it's clear that Postgres is making a dent on Oracle's ability to dominate database purchasing decisions in the way it once did.