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Microsoft vs. Teradata: Data warehouse technology poised for competition (no, really)

The data warehouse technologies unveiled by Microsoft and Teradata last month may put the vendors in direct competition -- good news for buyers, according to expert Mark Whitehorn.

In consecutive weeks last month, Microsoft held its second annual Business Intelligence conference, and Teradata...

held its annual Partners conference -- both unveiling new data warehouse technology enhancements.

Now, Miamisburg, Ohio-based Teradata isn't exactly a household name, largely existing under the radar (even for many of those working in IT), and its stated market has been the top 1,000 companies worldwide. Microsoft, on the other hand, is almost too well known, and it does deserve credit for increasing awareness in the business community of data warehousing and BI. Microsoft has long championed the idea of "BI for the masses" and has made it possible by providing affordable, usable BI tools to every buyer of SQL Server.

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Get Mark Whitehorn's take on the Microsoft Business Intelligence Conference 2008 and Kilimanjaro, Madison and Gemini

Given the totally different customer bases, Microsoft and Teradata have never been even close to competitors. However, data warehouse technology announcements made by both companies at their respective conferences make for an interesting comparison that may give us a glimpse of future conflicts.

First, chronologically speaking, came Microsoft's Seattle conference. As reported earlier, Microsoft announced Madison, the code name for the integration of scalability technology (from the recent purchase of DATAllegro) into SQL Server. In a nutshell, Microsoft says Madison has the potential to increase dramatically the volume of data that can be handled in OLAP (on-line analytical processing) applications, and also to facilitate the implementation of data warehouses based on relational architecture (the Inmon approach).

Then Teradata announced at its Las Vegas conference an addition to its range of products. The Extreme Data Appliance 1550 is positioned in the center of the product range and adds to the vendor's appliance line. The real Wow! factor came from the cost -- $16.5K per terabyte of data -- which is truly remarkable in the field of data warehouse appliances.

And that's an interesting change: Teradata has always been for the big boys, catering to an enterprise market both in pricing and marketing. It has, however, been sufficiently astute over the last few years to take note of the adoption of data warehouse applications by companies lower down the pecking order. Having announced its first appliances earlier this year, the Extreme Data Appliance 1550 is an option that will look attractive to many large and midsized organizations. The price alone is encouragement to businesses outside the top 1,000, which would never previously have considered using such an up-market supplier but now may think about using Teradata's products. A strategy that encourages such companies to make an initial investment can only be good news for Teradata in the longer term.

So Teradata is looking more attractive to smaller companies, and Microsoft -- with the improved scalability offered by Madison -- is looking more attractive to larger companies.

The day will come when these two come head-to-head pitching for a new sale. From the buyer's point of view, it's probably nothing but good news – there are now two excellent solutions to consider, and the likelihood of finding one that's good for you, at a reasonable price, has surely increased.

About the author: Dr. Mark Whitehorn specializes in the areas of data analysis, data modeling, data warehousing and business intelligence (BI). Based in the U.K., he works as a consultant for a number of national and international companies, designing databases and BI systems. In addition to his consultancy practice, he is a well-recognized commentator on the computer world, publishing articles, white papers and books. He has written nine books on database and BI technology. The first one "Inside Relational Databases" (1997) is now in its third edition and has been translated into three other languages. The most recent is about MDX (a language for manipulating multi-dimensional data structures) and was co-written with the original architect of the language – Mosha Pasumansky. Mark has also worked as an associate with QA-IQ since 2000. He developed the company's database analysis and design course as well as its data warehousing course.

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