TechWeek: Tech Can't Win for Losing

By the most conventional metric -- sales of application servers -- Oracle's market share is teensy, about 2.5%, according to market researcher Gartner. By that measure, BEA leads with a 34% share, and IBM is second at 33%.

But Oracle has widened the category to include numerous other types of software, including some that almost no one else counts as middleware. "It's everything but the kitchen sink," says Dennis Byron, principal analyst with IT Investment Research.

"I don't question their numbers, but it simply isn't an apples-to-apples comparison with other companies," he says.

To be fair, there is a category in Gartner's schema that incorporates most -- but not all -- of Oracle's middleware, and it's called Application Platform Suite, of which Oracle has a better than 48% share.

Also a bit puzzling is the relatively high proportion of maintenance fees to license fees in Oracle's middleware business. Byron estimates that license revenue, an indicator of new business, accounted for about 300 million middleware dollars for Oracle; the rest came from maintenance, which is generated by existing customers.

Typically, says Byron, a new business exhibits a higher percentage of license revenue. "Oracle says they are taking share, but if the majority of revenue comes from maintenance, there seems to be a disconnect."

The argument is somewhat reminiscent of the dispute between Siebel and SAP(SAP) over which company really had the biggest market share of customer relations-management software.

Ultimately, most people figured Siebel was the winner. The outcome: Siebel faltered and fell into Oracle's maw.

So much for the power of market share.

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