Microsoft opens SQL server to Linux

For years, Microsoft built walls between its products and the rest of the industry. Now it is tearing them down.

Microsoft, the world's biggest software company, is known for creating business software that runs only on the Windows operating system. That has made it hard - or impossible - to buy something like a database from Microsoft without first buying Windows to run on a server.

But on Monday Microsoft announced that SQL Server, its software for managing corporate data, would also run on Linux, a competing operating system. Other Microsoft products could follow suit, analysts said.

SQL, pronounced "sequel," is among Microsoft's most important products, and the chief way it competes with the Oracle Corporation for business customers.

Microsoft has always sold PC software for other companies' operating systems, like that used by Apple's Macintosh computers. But since becoming chief executive of Microsoft two years ago, Satya Nadella has gone further by creating software to run on other mobile operating systems like Apple iOS, and decoupling Microsoft's Azure cloud computing system from Windows.

Now, for the first time that strategy is extending into so-called back-office software, a lucrative but not as well-known part of Microsoft's business.

"Data is the core asset now," Nadella said.

The numbers bear that out. While Windows Server is still popular, Linux servers are gaining. According to the research firm Gartner, 3.6 million Linux servers were shipped in 2014, compared with 2.4 million in 2011. Windows servers fell to 6.2 million in that time, from 6.5 million.

In the old computing world, decoupling Windows and SQL would have been unthinkable to Microsoft executives. But with Linux servers trending up and Microsoft servers heading down, insisting that SQL has to run on Windows would mean turning away potential customers.

That is not to say that Microsoft is in a weak position in corporate software sales. Even running on only one of two operating systems, Gartner said, Microsoft has 21.4 per cent of the market in data management software. That is ahead of IBM and SAP, and behind only Oracle, which Gartner estimates still has a 43 per cent share.

Nadella wants to go after the computers running Linux. "It's a market expansion opportunity," he said. Still, it is not easy to do. Some customers will work with a Linux version of SQL this year, but a full commercial release is not expected until 2017. Even the announcement could change company buying plans, however, tempting people to put off purchases until they can get the new version of SQL.

"They definitely hesitated to do this, because of the negative implications for Windows," said Al Gillen, an analyst with IDC. Before, he noted, having SQL only on Windows increased operating system sales, adding "this makes Linux more attractive." That may be a necessary sacrifice, in Nadella's eyes.

He is stressing the company's business in cloud computing, called Microsoft Azure, which is a way of renting server, data storage and applications over the Internet. Both Windows and Linux servers are available in Azure. Nadella said SQL would also be available in Azure. Gillen said other Microsoft products, such as its SharePoint collaboration software and its Exchange email product, might also be adapted for both Linux servers and across Azure.

Nadella's long-term plan may be to seek a new kind of control over the so-called stack of operating systems and applications. In January, Microsoft announced a way to make servers that operate in a cloud system work closely with software that runs on traditional servers.

"He is thinking about building the new stack in a more coherent way," said Merv Adrian, an analyst with Gartner. "They want to be the go-to company for all developers, not just developers on Windows."

The old competition is making its own moves to adapt to the data explosion. Oracle has been on a recruiting frenzy for cloud engineers, and says that it has the greatest number of products for data analysis. IBM has spent billions on its own cloud, and lauds the data-sorting and artificial intelligence potential of Watson, its "Jeopardy!" champion computer.

Nadella is unfazed for now. "As a percentage of GDP, technology spending is only going up," he said. "All the decisions we've made are around this market expansion."