Yukon Will Open New Frontier for Third-Party SQL Server Market

Not everyone is patiently biding his time waiting for the much-delayed release of SQL Server 2005 (“Yukon”), now anticipated to ship by the end of the first half of 2005. Members of Microsoft’s network of business partner vendors see the gold running in Yukon, and are ready to spring into action with enhanced solutions. SQL Server 2005 is chock full of new tools and capabilities, and partners and analysts say the database platform is poised to vault to first place in leading the burgeoning business intelligence and reporting space. It’s now a matter of getting the product out to capture this momentum.

Delay after delay in the planned release of the product has some analysts concerned that Microsoft may lose this opportunity for itself as well as solutions partners. “Who knows when Yukon will ship?” says Mark Smith, analyst with Ventana Research. “This long product cycle has cost Microsoft growth they could have achieved if they would not have such long major product releases. ISVs do not want to wait, and have to ensure they operate across different stacks as well.”

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The delays have Microsoft’s partners chomping at the bit, adds Rob Enderle, president of Enderle Group. “A new product platform generally represents a strong upgrade revenue opportunity for ISVs. Certainly IT buyers like it this way, but ISVs live on product releases and the delays associated with Yukon are becoming painful,” he says.

Still, other observers feel that Microsoft already has such a potentially commanding presence in the market with SQL Server 2000 that any delays won’t hurt at all. “Say Microsoft delays Yukon for another six months. So what?” says Peter DeBetta, an independent software consultant, trainer for Wintellect, and author of Introducing Microsoft SQL Server 2005 for Developers (to be released October 2004). “SQL Server 2000 has been holding its own in the industry, and giving Microsoft a much bigger market share. People said they couldn’t compete with the Oracles and DB2s. Yet, here they are, doing so with SQL Server 2000, which has been around for four years. If it’s a question of putting out a better product, and waiting six months to do so, I think it’s a better choice for them. It’s in Microsoft’s best interest to put out a better product, even if it’s delayed a little.”

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In fact, some SQL Server business partners say that the slow pace of releases has actually helped solidify Microsoft’s presence in many enterprises – providing a platform set up and ready for the latest database system. “The fact that Microsoft is bundling in very powerful frameworks definitely plays into our sales cycle, and how we position our products,” says George McMann, president and CEO of BizNet Software. “A lot of the people already have SQL Server 2000. They may already have a newer version of Microsoft Office. They may already have one or more instances of Windows Server 2003. So the costs for the foundation are already sunk.”

Microsoft may even be missing out on an enormous opportunity to more aggressively promote the BI capabilities of SQL Server. “Yukon is a very sophisticated collection of information technologies from DTS [Data Transformation Services] to UDM [Unified Dimensional Model] to Reporting Services,” Smith says. “In some cases, there’s even more technology than organizations actually need. There is so much in the box that they could make more impact to the market if they packaged the tools outside of the database into some type of BI package. Microsoft could really change the BI market landscape. If they also could have shorter release cycles on the package outside of the database, then we have a market shaker.”

Microsoft – and by extension, business partners – could then go after more lucrative prospects within larger enterprises. DeBetta cautions that the traditional SQL Server market is typically a cost-conscious group that prefers customized solutions build with SQL Server tools to pre-packaged third-party tools. “Third-party tools are cost prohibitive,” he says. “There aren’t many companies that aren’t willing to foot the bill for $2,000, $3,000 or $4,000 products, when the tools that SQL Server comes with will do the job. And Yukon comes with a lot of tools. Vendors will be offering features that still aren’t readily available, but some of them are just going to have to change their approach or pricing.”

Some Microsoft business partners, however, see far more opportunity than threat in Microsoft’s new database. “We really look forward to a lot of what Microsoft is doing in Yukon,” relates Andy Coutts, president and CEO of Databeacon. “As a vendor, we’re always looking for infrastructure to build on. Clearly, Microsoft keeps putting more and more capability into SQL Server that we can leverage.”

Of particular interest are new features in Microsoft’s business intelligence line, including upgrades of Analysis Services, Reporting Services (already released), and Data Transformation Services (DTS). DTS in particular garnered the enthusiasm of vendors interviewed for this article. According to Microsoft, SQL Server 2005 DTS will provide developers with enterprise-level extract, transform and load (ETL) capabilities out of the box. DTS will also handle Web services and XML sources, along with data cleansing, data mining and text mining. “What they’ve done with DTS enables us to not have to go down a path where we start brining our own ETL type technology to our product,” says Coutts. “That’s an area where we don’t really want to build it out, we think there’s lots of value in SQL Server there.”

McMann of BizNet is equally excited about DTS. “The single most important aspect of Yukon as it relates to our product line is going to be the revamping of DTS,” he says. “We need to merge the data, pull the data from different sources, and merge it into a common view. In our market, the mid-market, we can’t afford high-end middleware products; it would blow our price-point right out of the water.” DTS within SQL Server will provide a cost-effective ETL environment, McMann adds. However, previous releases – which date back to the release of SQL Server 7.0 – were too cumbersome to work with, he notes. “In SQL Server 2000, it started to look very promising. But we still don’t use it that much. One of the main problems we had with it is when you connected different tables, it was too easy to get misleading results. We wanted to have a single connection string for all relevant data. DTS didn’t provide us an easy way to do that, but it does with the next release of SQL Server.”

Analysis Services represents another major enhancement that add-on partners are anticipating. According to Microsoft, Analysis Services is enhanced in SQL Server 2005 with additional MDX expressions and new MDX script capabilities designed to support complex and advanced modeling needs. In addition, Analysis Services includes an online mode that allows developers to develop applications in real time. “We have a lot of enterprise installations of Analysis Services with the 2000 release,” says Douglas McDowell, principal consultant for Intellinet. “We have lots of clients on OLAP Services. But there is going to be a dramatic difference with Yukon. Microsoft basically went back and rewrote the product from the ground up, and took a more enterprise architecture approach to it, and matured the product dramatically. And added tons and tons of features.”

SQL Server 2005 will represent a major upgrade for most of Intellinet’s clients, McDowell adds. “They’re adding a metadata layer – the Unified Dimensional Model – that will allow organizations to facilitate better ad-hoc reporting across heterogeneous databases,” he says. “It’s a paradigm shift for the architecture of Analysis Services.”

However, the market is not standing still while Yukon approaches its long-awaited debut. MySQL, an open-source relational database, is now prevalent in 40 percent of enterprise development shops, up over a third over the past year, according to research from Evans Data Corp. Another megasize database challenger, IBM, is making an aggressive play for partners’ hearts, minds, and attention. “Microsoft is more consistent then either Oracle or IBM and has a more complete tools set surrounding their offering,” says Enderle. “However, IBM currently has an aggressive program to capture developers which, coupled with Microsoft’s less than stellar image, may give IBM a leg up.”

Another strong competitor in this space, Oracle, is seen as the Mercedes of databases, the vendor has been ham-handed with partner relationships, analysts say. “Oracle’s relationship with developers is often a love-hate thing – they are very uneven and their developers seem to be really nervous about company direction,” Enderle says.

Ventana’s Smith agrees that “the Oracle partner program is basically not a priority anymore – it lacks substance and focus. IBM has put a lot of muscle in their partner program. Many of the enterprise-class technology vendors are now swirling around IBM.”

However, Smith continues, Microsoft itself has not been delivering a winning performance in vendor partner relations. “Microsoft used to be much more outgoing as a partner,” he explains. “My recent interaction with the SQL Server and AS partners have indicated that at the product level the partnerships go well, but at the go-to-market and field-level, engagement is a bit lacking. They will throw money at the partners and match dollar for dollar, but do not follow through and help make events and programs real successful. They are slow on support as well. We have been involved with many of their partners in programs that have not been that successful.”

About the Author

Joe McKendrick is an independent consultant and author specializing in surveys, technology research and white papers. He's a contributing writer for

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