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IBM targets smaller firms with flat database fee

Martin LaMonica CNET News.com

Published: 20 Oct 2003 10:20 BST

IBM is looking to increase the competitive pressure on its database rivals with the introduction of a revamped database pricing plan for small and medium-sized businesses.

The company said on Friday that it will charge a flat fee of $3,899 (£2,332) for DB2 Express with an unlimited number of people accessing the database. DB2 Express is an edition of IBM's database designed with features such as simplified installation and configuration to appeal to customers in smaller organisations.

The unlimited-user pricing option is intended to expand the purchasing choices for small and medium-sized companies, IBM said. The computing giant's standard pricing for DB2 Express on Linux or Windows is $624 plus $124 per user, which includes maintenance and support. The flat $3,899 licence fee for an unlimited number of users can be applied to two-processor servers.

The pricing move follows a similar database pricing announcement last week from IBM's database rival Oracle. Oracle introduced Oracle Standard Edition, which is aimed at smaller organisations. Oracle charges $5,995 for a single processor version of Oracle Standard Edition, which can be used by an unlimited number of people. Oracle also offers a payment option of $195 per user for a minimum of 5 people, allowing a company to buy a relational database for less than $1,000.

IBM and Oracle are both battling to gain ground on Microsoft's SQL Server database, which has traditionally been strong with smaller organisations and with departments in large companies. Microsoft's database business grew faster than comparable database lines from IBM and Oracle last year, according to research company Gartner Dataquest.

Big Blue introduced DB2 Express in June, along with Express versions of software products such as WebSphere. The Express bundles are part of IBM's strategy to break into the midrange market, which Big Blue and its competitors view as an important area for future growth.

The Express offerings are also intended to make IBM's software easier to use by partners, such as value-added resellers, which create custom business applications for mid-sized companies. IBM said that nearly 300 business partners have signed on to use DB2 Express and about 20 customers have chosen it as well.

The flat $3,899 licence charge for an unlimited number of customers will be available at the end of October.

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