For a long time, data warehousing on a terabyte scale has been
the preserve of the largest and wealthiest corporations - retailers,
telecoms companies, banks. The reason is simple - cost.
Customers of the high-end data warehousing vendors - NCR's
Teradata, IBM and Oracle - typically spend more than $1 million a
year with their supplier just on upgrades and maintenance. Initial
purchase prices reaching into eight figures are not uncommon. The
technolog- ists justify that not just by the value that their
products deliver, but the cost of developing the algorithms, the
parallel hardware and the proprietary database engines that drive
the data analysis.
However, two start-ups - Netezza and DATAllegro - are challenging
that status quo with a proposition that chills the old guard and
intrigues customers: affordable data warehousing appliances.
Netezza brags that its data warehousing appliance is 10 to 50
times faster than anything else on the market, yet the box costs
half as much. Costs are kept low by leveraging commodity hardware
(standard processor units and storage) and adapting 'free' software
such as the Linux operating system and the open source PostgreSQL
database.
"Netezza's sweet spot is large, high-end database systems, like
credit prospecting systems," says Eric Schmitt, an analyst at
Forrester Research. "More importantly," he adds, "Netezza's
appliance approach requires significantly less care and feeding than
standard relational databases, thereby decreasing total cost of
ownership."
Stephen Brobst, CTO at Teradata, dismisses the new products as
"vast, cheap scanning boxes" targeted at the enterprise data mart
space, and not designed for complex analytics. Nevertheless, in just
three years Netezza has built up a list of customers which includes
Amazon.com, Cingular Wireless, CNET Networks and Orange UK. As a
result, year-old DATAllegro, which is run by Stuart Frost, the
founder of Select Software, finds itself addressing a market already
'educated'.
After a decade of fixed battle-lines, such competition suggests
the warehousing market is about to be come a much more dynamic and
volatile place.
