Deutsche Bank: MongoDB Isn't A Near-Term Threat To Oracle

In a report published Tuesday, Deutsche Bank analyst Karl Keirstead reiterated a Hold rating and $44 price target on Oracle Corporation (NYSE: ORCL). The analyst believes that MongoDB does not pose any threat to the company in the near-term.

In MongoDB's annual user conference, held in New York City on June 1, the NoSQL database vendor indicated that the database market was "ripe for disruption" and that it continued to be committed to its "developer centric roots."

Another key element of the user event was that neither MongoDB's CEO nor its key partners mentioned anything about Oracle displacements. The focus of the conference was on empowering developers rather than on "closing enterprise-wide deals with CIOs. The event also focused on "new use cases associated with web apps and sites," rather than on displacing the relational database workloads of Oracle or Microsoft Corporation (NASDAQ: MSFT).

In fact, according to the Deutsche Bank report, "Partners downplayed the ORCL displacement story and we heard that salesforce.com, inc. (which uses MongoDB in parts of its ExactTarget business) is not even close to using MongoDB to displace any of its huge ORCL database deployment."

NoSQL vendors, including MongoDB, have been witnessing robust growth, largely from new uses cases. The analyst therefore believes that displacement risk to Oracle appears modest in the near term.

The analyst believes that there are three other factors that are driving the company's database license growth. These include "1) overall spending on relational data management software, 2) the impact from the launch of 12c R2 and 3) ORCL's early-stage success in selling database-as-a-service," Keirstead said.