Feeds

SAP buys Sybase - but why?

$5.8bn question

Maximizing your infrastructure through virtualization

Comment German database maker SAP went on a shopping spree last week to buy in rather than build up a mobile platform maker to bolt onto its already bloated business. But why did it drop close to $6bn on Sybase?

It was arguably the biggest pure tech news story of the past week, in which German database giant SAP shook money out of its own piggy bank and secured a $2.75bn loan from Deutsche Bank and Barclays Capital to pay for the purchase.

Some considered the buyout to represent SAP’s efforts to step on Oracle’s toes, especially while the Larry Ellison-run firm is busy digesting Sun Microsystems and, at the same time, continuing to try and cleanse the nasty aftertaste in the mouths of its current and former employees.

The most interesting element of SAP’s planned takeover is - it would like you to believe - that Sybase will get its hands on the company’s in-memory processing tech, which will give the mobile platform maker a leg up in analytics.

SAP, for its part, said it would be able to ramp up its mobile offerings. This is all well and good in a database market that’s looking increasingly contracted. The acquisition, on the surface at least, makes the German company look like it’s still a relevant or even significant player in the database space.

But wind the clock back 12 years to Ellison’s precocious comment on who the database rivals were back in 1998: "I have only IBM and Microsoft to compete with, since Sybase and Informix are having a hard time sustaining their business."

In other words, Mr Oracle thinks Sybase jumped the shark a long, long time ago, when the iPhone was still a twinkle in Steve Jobs’ eye. So what’s changed? Well, we now have the iPhone.

Meanwhile Sybase is still out there doing its thing, no matter how small a global market share it commands - it was hovering somewhere around the five per cent mark at the last count. And perhaps the rationale follows over at the SAP camp that clamping a mobile platform to its clunking middleware bulk will help somehow propel it into the big boys' league by bringing its database onto more mobile handsets.

That’s the message SAP is hoping to bang home with this planned buyout, anyway.

Returning to Ellison’s 12-year-old comment about the database biz, he singled out Informix alongside Sybase as companies Oracle could probably afford to ignore.

By 2005 Informix was folded into the Big Blue family and the logic follows that had Microsoft made a play for Sybase around the mid-noughties then perhaps it would still, in its own small way, be able to look like a serious contender up against Oracle.

But SAP betting on a fairly anonymous firm that in Ellison's eyes was an also-ran way back in 1998, could yet prove to be an irrelevant but extremely costly acquisition. ®

Seven Steps to Software Security

More from The Register

next story
Whoah! How many Google Play apps want to read your texts?
Google's app permissions far too lax – security firm survey
Chrome browser has been DRAINING PC batteries for YEARS
Google is only now fixing ancient, energy-sapping bug
Do YOU work at Microsoft? Um. Are you SURE about that?
Nokia and marketing types first to get the bullet, says report
Microsoft takes on Chromebook with low-cost Windows laptops
Redmond's chief salesman: We're taking 'hard' decisions
EU dons gloves, pokes Google's deals with Android mobe makers
El Reg cops a squint at investigatory letters
Big Blue Apple: IBM to sell iPads, iPhones to enterprises
iOS/2 gear loaded with apps for big biz ... uh oh BlackBerry
OpenWRT gets native IPv6 slurping in major refresh
Also faster init and a new packages system
Google shows off new Chrome OS look
Athena springs full-grown from Chromium project's head
prev story

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Mobile application security vulnerability report
The alarming realities regarding the sheer number of applications vulnerable to attack, and the most common and easily addressable vulnerability errors.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.