An Interview with Simon Galbraith, Marketing Director of Red Gate Software, on Major Trends in the SQL Server Market

What do you see as the major trends affecting the SQL Server market?

SQL Server is becoming one of Microsoft’s biggest businesses. As it becomes bigger and more important, I think we’ll see a number of changes that affect users, Microsoft, and the market in which Red Gate participates.

The main market for SQL Server is the people who have the skills to exploit it – your readers. Their skills are going to increase in value as SQL Server is used more and more in serious production environments. The success of SQL Server means that it is becoming more important for Microsoft, which should translate into bigger budgets and a higher-level executive focus to support this business. The tools market for SQL Server that Red Gate plays in is going to continue to grow as the professionals who use SQL Server see the benefits of tools such as ours. All of these things should be good news for those of us involved with SQL Server.

As SQL Server gets more and more established and important data is stored in it, performance will no longer be only about making your queries run more quickly (although that will always be important). Performance, as your site recognizes, will encompass a much wider set of criteria.

Red Gate is known for its comparison products, but recently you launched a backup product. Why did you decide to develop that product and how is it doing?

Our experience in comparison products gave us a deep knowledge of SQL Server internals. We saw an opportunity to deliver the same kind of cost-benefit improvements to other parts of the SQL Server tools market. I’m sure you’ve seen the stories of lost backups that have compromised personal data for millions of corporate customers. We saw the need for a fast, easy process to produce encrypted backups. The response from the SQL Server community shows that our product was right on target.

Red Gate has grown quite a bit over the last couple of years. What has driven that growth and do you expect it to continue?

We’ve experienced wonderful growth; we’ve had to move our office 5 times in the last 5 years to cope – a happy problem to have. We have more than 12,000 customers now in the SQL tools market, which is more than all the other SQL Server tool vendors combined. Although SQL tools have been the most visible success story, sales of our .NET tools doubled last year. Our research indicates that there is still a sizable majority of SQL Server professionals out there who’ve never even heard of our tools. If we can find better ways to reach them, we’ll continue to grow.

Who are your competitors and what differentiates Red Gate?

Our biggest competitor is lack of awareness – the vast majority of the professionals who use SQL Server don’t use any tools at all. Our challenge is to persuade the people who never use a tool that they can save lots of time and effort using our software.

For SQL Compare and SQL Data Compare (our comparison and synchronization tools), the biggest competitors are Embarcadero and Computer Associates. At similar price points, we also face several ‘mom and pop’ shops. Our research shows that we own more than 95% of this market. Although our shareholders might prefer it if we didn’t have any competition, it is good for our customers that we compete with Embarcadero and Computer Associates to maintain our market share; it means we have to focus on improving our products and continuing to be innovative.

In the market for compressed and encrypted backups, Red Gate’s SQL Backup faces a raft of well-funded, serious competitors. Embarcadero and Idera have both entered the market in the last year, and Quest’s LiteSpeed still has customers numbering in the low thousands. These three competitors are all fighting over the same turf – the Enterprise. They are interested in selling to the Fortune 500 at a CTO level for big ticket prices. Although we have sold large numbers of SQL Backup licenses to very large companies, our focus is providing a tool that is affordable enough so that any SQL Server professional can compress and encrypt their SQL Server backups. We believe that everyone who has important information on SQL Server backups should be able to protect it. Our research indicates that there are only a few thousand customers of any compressed sql server backup software, and even fewer with the protection of encryption, so again we want to reach out to the majority of users who risk using native backup at the moment.

As far as I know. our SQL Packager product for packaging up a SQL Server database update as an executable doesn’t have any real competitors.

In terms of our approach we differentiate ourselves on three levels:

Simplicity: By focusing our efforts on a specific need, we make it so that users can achieve what they need with the minimum of fuss. The biggest benefit of this approach is quality; because we focus on a specific area we can spend the serious time and money required to make things really work.

Affordability: We price our products (starting at $195) so that our customers can afford them. Our goal is to create what we call a ‘virtuous circle’: by creating excellent-quality products at an affordable price we can get lots of customers; with lots of customers we can invest in making our products even better; and when our products are even better even more people will buy them.

Bundling compelling products: Individually our products are excellent, but together they are even more compelling. Here’s an example. SQL Backup provides a simple way to compress and encrypt your SQL Server backups. There is a lot of value in that – backups are faster, smaller and safe – which saves you time, money and stress. Our new product, SQL Log Rescue, will allow you to undelete what has happened to your SQL Server – so you will be able to undrop a table or undo column rename etc. It will enable you to recover from potentially awful situations whilst preserving the data that has just been entered – which could save you your job in the event of a disaster. Although they are excellent stand-alone tools, as a bundle they will provide the equivalent of SQL Server employment insurance. If you own SQL Backup and SQL Log Rescue, it will help protect your job, since it will be almost impossible for you to lose valuable data. At the moment no one offers this. If our competitors did address these issues, they would almost certainly try to solve both problems in one product – it would sound good, but wouldn’t work properly.

 

Continues…

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