Oracle's sales of new licenses decline as more startups embrace open source database software
Oracle Sales Erode as Startups Embrace Souped-Up Free Software — Dan Wagner, the chief executive officer of U.K.-based mobile payments company Powa Technologies Ltd., poses a challenge for database giant Oracle Corp.
Context & Ripple Effects
This lands six months after Oracle's quarter of profit and sales beats framed around a shift to cloud, and it exposes the fault line under those numbers: the new-license line, the core of Oracle's proprietary database franchise, is shrinking because startups are building on free open-source databases instead. Powa Technologies and CEO Dan Wagner are the named face of that defection — a payments company that would once have been a natural Oracle customer.
The arc runs long: by 2021 Oracle was courting startups with cloud offerings and favorable contract terms precisely to win back the cohort this story describes, and by late 2025 the market was punishing the company's next big bet — AI data centers for OpenAI — with its steepest quarterly drop since Q3 2001.
First-order effects
- Startups like Powa Technologies route new database deployments to free open-source software, directly cutting Oracle's new-license sales rather than just slowing their growth.
Second-order effects
- Oracle responds downstream by competing on commercial terms instead of product lock-in — the playbook visible years later when it targeted startups with cloud offerings and favorable contract terms while SAP ran the same play.
Third-order effects
- If the erosion pattern holds, Oracle's value migrates from selling perpetual licenses to winning hosted workloads — a dependency that culminates in the 2025 dynamic where the stock swings on skepticism about its ability to open more data centers for OpenAI after a $250B+ market-value reversal.
The trend: Database demand keeps shifting from proprietary per-license software toward free open source and cloud-delivered capacity, forcing incumbents like Oracle to chase each generation of buyers on new terms.