Oracle's data warehouse strategy unclear after Sun acquisition

With its acquisition of Sun Microsystems complete, Oracle faces a slew of questions regarding its data warehouse strategy.

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Despite its media offensive last week, Oracle still has some questions to answer regarding its data warehouse strategy now that the Sun acquisition is complete.

Prior to the Sun acquisition, Oracle wasn't in the hardware business but instead partnered with hardware vendors like IBM and HP to power its data warehouse deployments. In fact, Oracle sold more data warehouses on top of IBM server and storage technology than any other hardware.

And there are probably still a few Exadata v1 deployments out there running on HP servers. Exadata is Oracle's data warehouse appliance that it originally built using HP hardware. Version 2, which was released in September, bundles Oracle's data warehouse technology with Sun hardware.

Sun, meanwhile, has numerous partnerships with data warehouse vendors that use Sun hardware to power their data warehouse appliances. They include Greenplum, Vertica and ParAccel.

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 The bottom line: There are scores of Oracle data warehouses running on hardware other than Sun and probably nearly as many non-Oracle data warehouses powered by Sun hardware.

Unknown future for Sun's data warehouse partnerships, open source database

The question now is whether Oracle will continue supporting and selling its data warehouses on top of competitors' hardware now that it is in the hardware business, via the Sun acquisition. And what will happen to Sun's data warehouse partnerships?

"It's not at all clear what the status of all these partnerships is going forward," said Jim Kobielus, an analyst with Cambridge, Mass.-based Forrester Research.

To make matters more complicated, there's MySQL, Sun's open source database. While used primarily as a transactional system, more and more customers are turning to MySQL for data warehousing, Kobielus said.

"Going forward, will we see Exadata integrated with the MySQL storage layer and packaged up with Sun hardware?" he asked. "And if so, when, at what price and how would [Oracle] avoid cannibalizing [its] low-end, half-rack Oracle database machine running on Sun?"

The only sure bet, it seems, is that Oracle is going to push its Exadata v2 data warehouse appliance built with Sun hardware as its core data warehouse.

"Larry Ellison's goal is to move to an all-appliance model [built with Sun hardware]," said Donald Feinberg, an analyst with Stamford, Conn.-based Gartner. "Oracle salespeople are not going to lead with an HP box when they walk into an account."

But Feinberg doesn't think Oracle will abandon its lucrative customers running data warehouses on non-Sun hardware. "Oracle's not going to walk away from the client base that's out there," he said. "The bottom line is Oracle is in business to make money."

Kobielus agreed, in part, saying that although Oracle isn't going to sell Exadata with anything but Sun hardware, "I don't think they'll back away with hardware vendors partnered with the Oracle Optimized Warehouse."

That's good news for customers like the Gallup Organization, which runs its Oracle data warehouse on Red Hat open source servers. "At least at this point, [Oracle] is not going to de-support any of the Linux platforms, at least as far as we've heard," said Jim Collison, an Oracle applications manager at Gallup. "But I think it'll be interesting to see what they do in the long term."

Can Oracle Exadata compete with Teradata's performance?

There is still a question, however, as to whether Exadata can truly compare with the market leader in terms of performance – Teradata, according to Feinberg. It will take time to tell, he said, as there are not yet enough mature Exadata deployments to compare.

For its part, Teradata doesn't seem too worried by Oracle's Sun acquisition or its Exadata push.

"Oracle Exadata has been on the market for over a year, and although there has been much marketing hype, there are still very few systems in production for data warehousing," said Randy Lea, Teradata's vice president for product and services marketing. "We don't take any of our competitors lightly, but we're confident in our ability to compete against Oracle in our data warehousing space."

Whatever its data warehouse strategy may be, Oracle isn't saying, at least not publicly. Oracle did not respond to requests for comment for this story.

"At this point," Feinberg said, "it's difficult to have a crystal ball."

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