Dan Wagner, the chief executive officer of U.K.-based mobile payments company Powa Technologies Ltd., poses a challenge for database giant Oracle Corp.

Wagner’s company last year began shifting away from pricey products from Oracle and International Business Machines Corp., replacing them with open-source software, which is freely available and can be modified. Now, Wagner said the closely held company is converting virtually all of its operations to free database software.

“They scale and operate extremely well and they don’t cost anything,” Wagner said.

Other companies share Wagner’s view and are shifting to software whose code is public. While the threat to Oracle has been around for years, it’s becoming more intense with recent improvements that make open-source technology more reliable — and appealing to a new generation of multibillion-dollar startups, said Terilyn Palanca, an analyst at Gartner Inc.

SOURCE: bloomberg.com