Microsoft Thursday strengthened its hand in the database market by releasing the first 64-bit version of SQL Server. The product should help Microsoft address a broader segment of the database market, although it hasn't yet matched the high-end capabilities of market leaders IBM and Oracle, analysts said.SQL Server 2000 Enterprise Edition (64-bit) offers faster performance and the ability to support more concurrent users than did previous versions of the product, said Sheryl Tullis, a product manager for SQL Server. Perhaps as important, she said, it provides customers with an alternative to products from IBM and Oracle, which have offered 64-bit databases for years.Microsoft is pricing the new product the same as the 32-bit version, hoping to encourage customers to upgrade and also to undercut its rivals on price. The product should appeal to organizations that are consolidating multiple databases into a single system in order to cut costs, who are building data warehouses and who are deploying large-scale ERP and CRM systems, Tullis said."What we offer is going to be half the cost of a Unix project. I don't expect people to rip out all their existing systems, but if they're doing new projects I think they'll see Microsoft as really attractive," she said.The 64-bit database allows Microsoft to address "a large portion of the sweet spot of the database market," Gartner analyst Betsy Burton said."Think about the average database; it's typically a few hundred concurrent users and a few hundred (gigabytes) of data. That's the mass market, where Oracle is trying to compete better (by offering its database on Linux), and where Microsoft is trying to move up with 64-bit SQL Server. More and more, there are comparisons to be made between the two," she said.For businesses building very large data warehouses, however, or for those that need the very highest levels of availability, such as banks and busy e-commerce Web sites, Oracle9i and IBM's DB2 are still likely to be more suitable products, she said."The 64-bit release incrementally helps SQL Server gain credibility and support a broader set of applications, but still, for the cream-of-the-crop high-end data warehousing and high-end [online transaction processing] applications, the market is still dominated by IBM and Oracle," Burton said.Microsoft has yet to equal Oracle's Real Application Clusters technology, which lets businesses run a database across groups of servers for nearly continuous uptime, said Carl Olofson, an analyst with IDC, in Framingham, Mass. The company also lags in its ability to store and manipulate XML data, where Oracle and IBM have been hard at work, analysts have said.Microsoft's Tullis acknowledged some of the shortcomings."We have some room to grow in data warehousing and we're addressing that with Yukon," she said, using the codename for a future version of SQL Server that she said Microsoft will start beta testing in the first half of this year. Such beta programs typically take 12 to 18 months to complete, although the final release date for Yukon "depends how many betas we need," she said.Yukon will also provide new XML capabilities and be designed from the ground up to improve security, she said. The 64-bit database released Thursday is based on Service Pack 3 of SQL Server 2000, which means it shouldn't be susceptible to the SQL Slammer worm that spread rapidly in January, Tullis said.Yukon will be the database release that makes Microsoft "feature-function comparable with the higher-end offerings of the competition," IDC's Olofson said. "This (first 64-bit product) is really intended to make them comparable from a performance standpoint," he said.The 64-bit version of SQL Server is unlikely to inspire customers to migrate away from IBM and Oracle, a process that can be risky and costly, Olofson said. Interest is likely to come from customers starting new projects, those who favor Microsoft's .Net platform and those who are attracted by the lower entry cost of SQL Server compared with DB2 and Oracle9i, he said.Price was what attracted at least one customer at Microsoft's launch event here."We use Oracle's database software today but are looking at SQL Server because it is cheaper," said Martyns Kanu, a system engineer and network specialist at the San Mateo County Community College District in California.The district already uses Windows 2000 Server on 15 systems at three different campuses and is contemplating an upgrade to Windows Server 2003, Microsoft's new operating system launched here Thursday. SQL Server could complement that operating system upgrade, Kanu said.As well as improving its database software, Tullis said, Microsoft could compete more effectively with Oracle and IBM by helping SQL Server DBAs (database administrators) to improve their skills at managing data centers, an area where the company has not traditionally had a strong presence."Oracle DBAs are very well trained; they're great in the data center. SQL Server has been around only 10 years, so those guys are just coming up on things like, How do we do security processes, how do we do best practices, how do we maintain four-nines reliability? That's what's going to make the big difference, when they grow into the job, and it's our job to help them do that," she said.Oracle and IBM shouldn't be too worried about losing customers to Microsoft's first 64-bit database, although the competitive pressure from Microsoft is likely to increase as time goes on, Olofson suggested."There's a considerable base of support within the Oracle user community, around not just the database but the whole constellation of products and tools. That gives them enough momentum that I don't think they have any immediate worries about erosion, and IBM also shouldn't be worried about erosion. It's a matter of whether opportunities in the future will be taken away; (Oracle and IBM) will have to fight harder for those opportunities," he said.Joris Evers contributed to this report.