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The news may have befuddled Microsoft CEO Steve Ballmer and blindsided IBM, but Oracle Corp.'s decision to acquire Sun Microsystems for US$7.4 billion has been mostly welcomed by SMB market watchers in Canada.

It bodes well for the tech industry in general, according to James Alexander, senior vice-president, partner eco-systems at Info-Tech Research in London, Ont.

"And specifically, it's very significant for small and mid-sized businesses (SMBs)," he said.

IT World Canada Video – Oracle's proposed acquisition of Sun

"At least in a couple of ways."

First off, Alexander noted that many midmarket firms run their business on Sun systems.

Were Big Blue successful in its bid to buy Sun, one of its first steps would be to phase out a huge chunk of Sun's hardware, he said. "At least with an Oracle purchase those parts will continue to be supported … so from that perspective it's good news."

SMBs are also likely to be affected by MySQL database becoming part of the Oracle portfolio, he said. But the exact nature of that impact isn't entirely clear right now.

MySQL – fate unknown

With more than 11 million installations, MySQL has been dubbed as "the world's most popular open source database." It was developed by Swedish company MySQL AB, acquired by Sun in January 2008.

While after this acquisition, the open source character of MySQL remained intact, its fate as part of the Oracle portfolio is uncertain. 

"It remains to be seen whether Oracle will retain it as free, open source software," said Alexander.

At a bare minimum, he said, Oracle will probably write hooks into MySQL from its own applications.

"And perhaps they will have a slimmed-down free version, with extensions you can buy from them … so they can have a foot in each camp."

MySQL's much touted ability to reduce database total cost ownership (TCO) is one reason for its runaway success, especially in the small and mid-sized market.

Success stories have widely circulated of SMBs – such as Pivex, NetQoS and Friendster.com – using MySQL to boost database reliability and performance, and reduce costs – at times by as much as 90 per cent.

It's clear that MySQL's fate under Oracle will be of great interest to many SMBs, Alexander said. 

"Leaving a core version of it free and open source, and then building in extensions they can bill for … that's going to be the most likely strategy."

Up until now, he said, Oracle has tried hard to appeal to the open source community. "So I think they'll be loathe, as their first move, to jettison open source or the free version of MySQL."

Besides, Oracle's core database product doesn't really compete in the same space as MySQL, Alexander said.

At any rate, open source database vs. Oracle database could turn out to be one of the banner issues of the Oracle-Sun merger, another analyst noted.

"It's certainly going to be a tough call for Oracle -- whether or not to continue along the path of driving database open source middleware," said Vito Mabrucco, senior vice-president, worldwide consulting at analyst firm IDC Canada in Toronto.

Potential conflicts between Sun's open source strategy and Oracle's database products – the core of its profitability – would need to be resolved, he said.

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