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Oracle’s Exadata Boosts Speed, Saves Space; Cost Savings to Come 321 Pacific Ave., San Francisco, CA 94111 | www.blueshiftideas.com INITIAL REPORT November 17, 2011 Companies: CSCO, DELL, EMC, HPQ, IBM, MSFT, NTAP, ORCL, TDC, VMW 1 Reverdy Johnson, [email protected], 415.364.3782 Summary of Findings All 12 sources said Oracle Corp.‟s (ORCL) Exadata database machine quickens data input and migration as well as processing and analytics. As a result, Exadata‟s performance has freed up capacity and led many sources to increase their workloads, including in new jobs and new revenue streams. Sources said Exadata has exceeded expectations and is a breakthrough and reliable device. Five sources fully expect to order more Exadata racks. Another source already has added to his initial Exadata purchase. None of the other sources has ruled out a future purchase. Exadata saves energy costs, decreases terabyte requirements and, in some cases, conserves space at data centers although many sources have used the extra room for other hardware. Exadata is viewed as unique, with no viable competitors. Its edge stems from its ability to both house and process data quickly. The closest competitors are strictly data warehouses. Because of the initial high cost, Exadata will not save companies money in the short term, but sources expect the machine to result in cost savings in the long run. Challenges related to Exadata were described as manageable. Minor installation glitches and the expected learning curve were the most common complaints. Two sources said Exadata will change corporate culture, diminishing the importance of the storage teams while bolstering status of database administrators. Four sources said Oracle‟s new Database Appliance is a logical product extension with a strong market potential among smaller businesses with tighter budgets and less technological know-how. It serves as a possible add-on or flash memory device for users scaling up. The Database Appliance was viewed as yet another way for Oracle to bring new customers into the fold. One source said Exadata may result in lost business or market share for Oracle component/hardware suppliers, including Dell Inc. (DELL), Cisco Systems Inc. (CSC), EMC Corp. (EMC) and IBM Corp. (IBM). Improves Data Speed Saves Space Already Has Saved Customers Money Exadata Box Users Research Question: What are customers’ reactions to Oracle’s second version of the Exadata database machine in terms of cost savings, data speed and space conservation?

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Page 1: Oracle’s Exadata Boosts Speed, Saves Space; Cost Savings ......performance speed and reduce storage requirements. Oracle believes that by combining the software and hardware components

Oracle’s Exadata Boosts Speed, Saves Space; Cost Savings to Come

321 Pacific Ave., San Francisco, CA 94111 | www.blueshiftideas.com

INITIAL REPORT

November 17, 2011 Companies: CSCO, DELL, EMC, HPQ, IBM, MSFT, NTAP, ORCL, TDC, VMW

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Reverdy Johnson, [email protected], 415.364.3782

Summary of Findings

All 12 sources said Oracle Corp.‟s (ORCL) Exadata database machine quickens data input and migration as well as

processing and analytics. As a result, Exadata‟s performance has freed up capacity and led many sources to increase

their workloads, including in new jobs and new revenue streams.

Sources said Exadata has exceeded expectations and is a breakthrough and reliable device.

Five sources fully expect to order more Exadata racks. Another source already has added to his initial Exadata purchase.

None of the other sources has ruled out a future purchase.

Exadata saves energy costs, decreases terabyte requirements and, in some cases, conserves space at data centers

although many sources have used the extra room for other hardware.

Exadata is viewed as unique, with no viable competitors. Its edge stems from its ability to both house and process data

quickly. The closest competitors are strictly data warehouses.

Because of the initial high cost, Exadata will not save companies money in the short term, but sources expect the

machine to result in cost savings in the long run.

Challenges related to Exadata were described as manageable. Minor installation glitches and the expected learning

curve were the most common complaints. Two sources said Exadata will change corporate culture, diminishing the

importance of the storage teams while bolstering status of database administrators.

Four sources said Oracle‟s new Database Appliance is a logical product extension with a strong market potential among

smaller businesses with tighter budgets and less technological know-how. It serves as a possible add-on or flash

memory device for users scaling up. The Database Appliance was viewed as yet another way for Oracle to bring new

customers into the fold.

One source said Exadata may result in lost business or market share for Oracle component/hardware suppliers,

including Dell Inc. (DELL), Cisco Systems Inc. (CSC), EMC Corp. (EMC) and IBM Corp. (IBM).

Improves Data Speed Saves Space Already Has Saved

Customers Money

Exadata Box Users

Research Question:

What are customers’ reactions to Oracle’s second version of the Exadata database

machine in terms of cost savings, data speed and space conservation?

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Oracle Corp.’s Exadata

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Background

Oracle‟s second version of Exadata is a database machine that serves both data warehousing and online transaction

processing. It is intended to allow companies to lower costs by consolidating workloads onto one platform, improve

performance speed and reduce storage requirements. Oracle believes that by combining the software and hardware

components in a preconfigured format, Exadata could eliminate the configuration issues that plague many organizations and

eliminate the need for multiple database server and storage server solutions while increasing storage and speed.

CURRENT RESEARCH This report aims to gauge customer reaction to Exadata and to determine if the database machine has resulted in cost

savings, higher speed and improved storage. Blueshift employed its pattern mining approach to establish and interview

sources in two independent silos:

1) Exadata box owners/users/customers (12)

2) Secondary sources (5)

Blueshift interviewed 12 primary sources and included five of the most relevant secondary sources focused on the changing

administration dynamic in IT departments as a result of Exadata, praise for the new device, details on cost and payment

structure, and inputs on the Database Appliance for small and midsized businesses.

Silos

EXADATA BOX OWNERS/USERS/CUSTOMERS Director of database development for an automotive industry company

This source bought one full Exadata X2-2 (formerly known as V2) in mid-2010 for $3 million all-inclusive (hardware and

software licenses). The machine has exceeded company expectations, with processing speeds that are 10 times faster

than the company‟s previous system and much improved from Oracle‟s V1, which disappointed the industry. He expects

sales of the Exadata box to do well because Oracle has a captive audience in its existing customer base and continuous

revenue through annual maintenance fees. The new rack replaced six servers, saving energy costs and making room for

other equipment at a rented storage center. It has not saved money for the company, but Exadata‟s sophisticated data

analysis and speed capabilities have helped the company create new customer products and revenue streams. He

expects his company to purchase another Exadata box.

“The box definitely makes a difference. Our company business is

providing data and database warehousing with high value and

performance. We have been at the forefront with Oracle, but with our

standard configuration of servers there comes a point where you reach

a limit of what the database system can do.”

“The Exadata first came out in November of 2008. That was the

Version 1. It was interesting but rough around the edges. It had a lot of

issues, and to keep customers happy it took a lot to keep it running

smoothly. Early on, a lot of companies were unhappy with V1.”

“In November of 2009, they came out with the Version 2 and

introduced it at a trade show. We bought it and installed it in July of

2010, and it is apparently miles better than the first one. We have

been absolutely thrilled, and its performance is beyond what other

[nontechnology] people at the company expected.”

“It comes in different configurations, so the costs vary. We bought one

full rack, which is the standard buy and the cost covers all of the

licenses and hardware. It‟s an expensive device and it cost us about

$3 million. But it really is not substantially more expensive than if you

bought everything separately.”

We have been absolutely

thrilled, and its performance is

beyond what other

[nontechnology] people at the

company expected. … There is

increased data speed. We have

stuff running for customers that

is 10 times faster than before.

A job that once took 15

minutes now takes just

seconds. The speed change is

absolutely dramatic.

Director of Database Development

Automotive Industry Company

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“They sell them by the quarter rack, half rack and full rack, so the price of a quarter rack might be around half a

million and so on. The bulk of the cost is for the licenses, so about two-thirds of the cost are in licensing with

about one-third of that for the Exadata licenses and the other third for the database licenses. The rest is for

hardware, etc. If you look at it from a monetary perspective, the software license is the highest margin item you

can have. There also is annual support and maintenance, and that comes to about 22% of the originally cost,

annually. The annual fee includes personnel support, patches and new releases. So if you have an Oracle V10

and they introduce a V11 there is no extra cost.”

“There is increased data speed. We have stuff running for customers that is 10 times faster than before. A job

that once took 15 minutes now takes just seconds. The speed change is absolutely dramatic.”

“We have been an Oracle customer for 10 to 15 years. We are a small niche company and have no room for

more equipment. For us, it is more about performance and space. As we see more and more data being

generated in our industry niche, it gets harder and harder to analyze without higher performance capability. Also,

in part because of Google search, people just expect better data.”

“Is it saving us money? I wouldn‟t go that far. But it is providing something for us we did not have for our

customers before. I suppose some companies are saving a lot of money. I know one company that had 36

Teradata devices and now they have three Exadata racks, so the cost can go down if you use technology that

uses less energy and space.”

“It is saving us lots of space. We rent a space for our servers at a

hosted data center that handles the backup and cooling and oversight.

This one device replaced six racks of what was there before. So it cut

our footprint down by 80% because it‟s all integrated into one box. The

magic of that is in the software. So right now we are down five racks,

but of course we just filled up that space with other junk.”

“We probably would buy more. Everything we have is not on Exadata

yet. We have 50 terabytes of Oracle storage and 18 terabytes are

already on the Exadata. In the next year, we will do a technology

refresh so we will take a look at our needs and wants. We maybe would

buy another full rack, but we would not have to pay out for the Oracle

licenses again, just the hardware and Exadata license. And then the

additional maintenance.”

“It has not hurt us in any way. The transition is almost transparent. It

has been more reliable than I expected. For example, we bought it in

July [2010], and by October we had most of our main customers on it.

We will move every one of our customers. In November of 2010, the

system was down for one hour and 40 minutes. That was the only

outage in a year, and that‟s not bad for such a new device. We did have

to learn some new things, but that was pretty easy.”

“Oracle is installing the database everywhere, and for any company

that has gained dominance in their niche or field, the box is hard to beat. I know they are selling a bunch of

them. They probably are not all full racks. Most getting it are already Oracle customers, so they can just roll [the

box] in. Exadata has a built-in customer base, and now they are pushing it really hard.”

“Their market is large, and most are already Oracle customers. Most of them are migrating to Exadata. If you are

with Oracle, this is the only real option. It‟s too expensive and overwhelming to start over. They are selling to

people who are already existing customers and their current customer base is huge.”

“I don‟t think others can compete with people who are already Oracle customers. That installation base is such

an asset. You might go with another if you are a smaller company. IBM [Corp./IBM] has the DB2 and Netezza.

Microsoft [Corp./MSFT] has the SQL server and DATAllegro, but it is not as heavy-duty. Teradata has a good

installation base, and they are loyal. They will continue to sell and improve versions, and I don‟t think Oracle can

make headway on Teradata. But I also don‟t think Teradata will kick out or overtake Oracle.”

“Another big selling point is that if you need help, you just call Oracle. With other systems, you are putting them

together with components from this company and that company, so if you need support it can be really

frustrating.”

“Before Exadata, there were separate components. The standard Oracle configuration was a Dell server, Cisco

component and an EMC storage device. Now it‟s all in one box. I do not believe that will knock the others out of

Is it saving us money? I

wouldn‟t go that far. But it is

providing something for us we

did not have for our customers

before. I suppose some

companies are saving a lot of

money. I know one company

that had 36 Teradata devices

and now they have three

Exadata racks, so the cost can

go down if you use technology

that uses less energy and

space.

Director of Database Development

Automotive Industry Company

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business, but it definitely with take some market share away from

them. I think EMC will be the biggest loser. IBM will definitely see some

changes.”

“Before Exadata, there were other systems offered. Teradata had a

special data-warehousing platform, but you had to buy their hardware

and software. There were a number of start-ups that came out with

data warehouse appliances, and the products were getting better and

better and they were getting better performance than Oracle was. That

is why Oracle developed Exadata.”

“Most of the people I know using it are pretty happy. I think Monsanto

is buying four or five. P&G has four to five, and Macy‟s has four. The

U.S. Customs and Border Protection bought 15 full racks to track all

the shipments that go through the ports. Amway bought three full

racks. These all may be part of the 1,000 already delivered, I‟m

guessing. Most are happy. But PNC Bank bought three to four, and they

had a rough time. So not everyone is doing back flips.”

“The next big thing we are seeing is flash memory. We have 18

terabytes [Exadata] in use, and it is filling up quickly. We are seeing

more pure storage flash memory that is not as fast as a server and has

less memory but it can be a bridge. I don‟t know if it would reduce the

value of the Exadata box.”

Senior data warehouse architect with a large financial institution

After buying two half racks of Exadata in July of 2010, the source said data input was 17 times faster than before and

data processing speeds were 100 times faster. Although he declined to provide cost details, he agreed with another

source who priced half racks at between $500,000 to $1 million each. The company expects to see a return on

investment for the full purchase cost in less than a year. The appeal of Exadata is reliability and simplicity that eliminates

the burden of managing technology. The Exadata has no viable competition. The biggest challenge for Oracle will be from

internal culture clashes and shifts in job descriptions as database administrators (DBAs) become more important and

storage teams less important to companies with Exadata machines. He expects his company to buy more Exadata boxes.

He also believes the Database Appliance will be successful and create customers in businesses that too small and

technologically inexperienced to embrace other Oracle products.

“In July of 2010, we bought two half Exadata racks, one for use in production and the other one as a

disaster/backup relief. I can‟t give you information on specific costs, but the true detail of the question goes to

our return on investment. We will get the payback of the full cost in less than a year. The total cost of ownership

additionally is about one-third the cost of other solutions. That is, one-third the total of what would have been

expected over a three-year lifespan. We also got a very good deal in terms of what we paid.”

“It is expected to save us money over the multitude of years. The

savings refers to everything related to the TCO [total cost of

ownership]. The reference to one-third the cost of other solutions

includes the data center savings because the thing takes up much less

space, so we are saving one-third of what we would have spent. We are

saving space and we are saving on what it would take to put it into the

data center and, of course, energy costs. But once you are using the

thing, that is where the real ROI is.”

“There are a couple of different metrics we look at when we assess its

ability. There are two applications: throughput and consumption. Our

throughput—the time it takes to put data into the machine—went up to

about 17 times faster than before. The migration time was about four

times faster, and the consumption of the data is about 100 times

faster. So to quantify the increase in speed, every minute becomes 3.5

seconds.”

“What this thing really does is it allows us to focus on our operations

and our business, rather than on the technology. It essentially has

Before Exadata, there were

separate components. The

standard Oracle configuration

was a Dell server, Cisco

component and an EMC

storage device. Now it‟s all in

one box. I do not believe that

will knock the others out of

business, but it definitely with

take some market share away

from them. I think EMC will be

the biggest loser. IBM will

definitely see some changes.

Director of Database Development

Automotive Industry Company

We will get the payback of the

full cost in less than a year. The

total cost of ownership

additionally is about one-third

the cost of other solutions. That

is, one-third the total of what

would have been expected over

a three-year lifespan. We also

got a very good deal in terms of

what we paid.

Senior Data Warehouse Architect

Large Financial Institution

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changed the conversation of our business. I would say it represents a paradigm shift, and I am not the kind of

person who is prone to making dramatic statements.”

“Will we buy more Exadata? Yes, I am 100% certain of it, and it will be sometime soon because it works really

well. I imagine we will buy a bunch, several, but it is more of a strategy and it will occur over the course of time. I

would say most current Oracle users that rely on big data are moving toward Exadata and they will move in that

direction as they have the need for more power.”

“You can‟t compare Exadata to other products on the market because

nothing out there comes close to it. You can‟t compare it to Teradata or

Netezza.”

“The one challenge I see that is insidious is that Exadata changes the

way you manage your infrastructure team. Your storage teams and

network teams are less involved, and now you really rely on your

database team. Storage is really not involved, but they are not out of

work, at least not right away. But because of this, it will change the

industry. Remember, 15 years ago people were buying motherboards

and making servers. We don‟t do that anymore. And with this machine,

we now don‟t need to do the engineering.”

“Is it disruptive? Any change is disruptive for those in the business who

resist the change. For the corporate culture it certainly will change the

playing field, especially if people who need to change the most resist.

Developers don‟t have to fix code with it. The biggest [internal/industry]

corporate losers are the storage guys because storage is integrated in

and Oracle has its own support/automation/storage team. The

database guys benefit the most.”

“There is a big market for it because everyone is moving to big data. As

our data volumes increase exponentially, people need more efficient, faster platforms. Anyone with a lot of data

needs it, and anyone who is ramping up to manage a lot of data, which is everyone else, needs it. This is

especially true in finance and medical records.”

“The Oracle Database Appliance is a totally different thing and not Exadata at all. It is an engineering solution

that comes with a database cluster. The preinstalled data gives a company access to some of Oracle‟s coolest

things. You can slap it in a rack, but it is completely separate. The application database is just a computer with

software preinstalled. Most would buy two, not just one. I don‟t know if anyone has purchased it yet or whether

it‟s even available, but I know there is a lot of interest.”

“Imagine Exadata as a car and you put the engine in and parts in and paint it. The Appliance is more like a bike

that comes in a box and you put it together and ride away. It is lower-scale and at a price point people are

interested in. It appeals to the low-tech company that cannot put things together themselves. But the Appliance

and Exadata can coexist. You can ride your bike in the park, but you would use the car to go on vacation.”

“Will the Appliance bring in new customers for Oracle? Absolutely, 100%, it will bring in new customers. Because

until Open World, Oracle was hard to get into. To configure you really had to know what you were doing. Now, you

really don‟t have to build anymore. Oracle [Exadata and Appliance] is especially appealing to businesses and

today‟s business model. With everything that‟s changed in the economy, people have got other problems to

worry about, and they don‟t want to think about the technology.”

DBA who handled the Exadata installation for a U.S. cable TV, telecom and

wireless company

After installing one full and one half Exadata rack, the source‟s company

experienced a 70% increase in the speed of data processing and performance.

The machine saves time and takes up less space, but the source doubted the

company would save money in the short term. The Exadata is unique and

currently has no viable competitor. The purchase of additional Exadata racks is

inevitable.

“We bought one full rack and one half rack, and we have them in the

same location but use one for production and the other for

development. We see a great big difference with Exadata, and our jobs

There is a big market for it

because everyone is moving to

big data. As our data volumes

increase exponentially, people

need more efficient, faster

platforms. Anyone with a lot of

data needs it, and anyone who

is ramping up to manage a lot

of data, which is everyone else,

needs it. This is especially true

in finance and medical records.

Senior Data Warehouse Architect

Large Financial Institution

We see a great big difference

with Exadata, and our jobs are

running about 70% faster. The

customers noticed the

performance change

immediately.

DBA for U.S. Cable TV, Telecom &

Wireless Company

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are running about 70% faster. The customers noticed the performance change immediately.”

“It saves a lot of space. It takes a 2-terabyte database and makes it into less than a terabyte database. But we

are not really down any racks or servers. We just replaced one thing for another.”

“We use it a lot for writing reports, and they are completed a lot faster. The processing is faster, and the loading

is faster. It used to take from midnight to 11 a.m. the next day to load all of the data for the day. That loading

time went down to six hours with Exadata. We used to use a lot of bitmap indexing, and we don‟t use it anymore.

So by dropping the bitmap indexing, performance overall is now much faster.”

“Personally, I love it. But they still have had some problems. That‟s true with every new database. Some of the

initial problems we had were our fault. Something went wrong, and it was apparent something was bad on the

rack after we set it up but we didn‟t call Oracle until after the fact. If we

had notified Oracle right away, they would have handled it. The

problem was just that one piece that went into it was bad. They

ordered it and replaced it. I do not believe it was a systemic problem or

a recurring problem. It was just a bad part. That happens sometimes.

As a whole, the system is great and the overall design is very good.”

“The full rack cost a million-something, but I don‟t have exact numbers.

It changes some things; it gives the database people more

responsibility, and it takes some responsibility away from the systems

administrator. So if you asked the SA, they may say they don‟t like it

because it takes away their job responsibility although no one has lost

their jobs yet. But there is some stuff the DBA can do now so we don‟t

need the input of the SA.”

“There is nothing to compare [Exadata] to. I have not used the

Teradata or the Netezza, but I know that all of the other ones are for

data warehousing only. With Oracle and Exadata, you can use it for

anything. When it first came out it was for data warehousing, but now

you can use it for day-to-day jobs and transaction processing and

analyzing data. With Oracle and Exadata, you get more bang for your buck.”

“It costs a lot of money upfront, so in the short term it won‟t save a company any money. But in the long term it

should save money. The compression and rack do save storage space, so there may be some saving in soft

costs. But, overall, you are not going to save any money on it today.”

“I think the company will buy more eventually, and I would not be surprised if they had one on order now.”

CIO for a U.S. subsidiary of a global consumer technology company

This source bought a one-fourth of a rack roughly six months ago as part of an enterprisewide transition to Oracle

General Ledger accounting systems. He is happy with the hardware‟s power and environmental footprint, but not pleased

with the Oracle environment in general. He expects to expand the Exadata system to meet his data warehousing needs.

“It‟s extremely fast and seems well-integrated with the Oracle database architecture as well as the front-end

applications we now run. We will almost certainly scale up our initial investment as we continue to migrate our

systems to Oracle.”

“Exadata is unquestionably an expensive machine, but we have very strict zero-carbon-footprint guidelines to

adhere to, so the fewer servers we have plugged in and spinning, the better. And right now we are using it

tactically to support the departments that interact most closely with Oracle‟s applications in order to get the

maximum engineered efficiency out of the system.”

“It‟s hard to say whether it‟s saving us money because it‟s so new that we‟re still in the integration spend. That

spend is going on much longer than we‟d like, and headquarters is not happy with the delays. Eventually, I hope

it will make our people more efficient, allowing us to integrate our business functions more effectively and

streamline our technology footprint. But that‟s a long-term goal. Right now, I just want to get our configuration

running smoothly.”

“The machine is actually fine. It‟s the software and the changes we needed to make to integrate it into our

platform that is causing frustrations. We had to add a lot of custom features on a tight schedule. If it was up to

me, we probably wouldn‟t have done any of this, but here we are.”

“We‟re not throwing away our old servers, so it‟s not like this is saving space in the here and now. Down the

road, as those servers reach the end of their life and we need more capacity, we will probably buy more and

It costs a lot of money upfront,

so in the short term it won‟t

save a company any money.

But in the long term it should

save money. The compression

and rack do save storage

space, so there may be some

saving in soft costs. But,

overall, you are not going to

save any money on it today.

DBA for U.S. Cable TV, Telecom &

Wireless Company

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slow our expansion, or replace a lot of racks with one of these. And, in the meantime, this slows my spend on

new boxes to expand our capacity since we‟ve essentially made those future purchases.”

“My hope is that pricing will eventually drop, so it makes sense to wait. Same as anything else in the storage

space. Granted, Exadata is a very sophisticated warehousing and processing box so it will be relatively resistant

to downward price pressure but not immune.”

“Teradata has something similar, and so does IBM. It wasn‟t really an option for us to shop around since we

wanted to integrate it into our Oracle applications to get the most efficient all-in-one performance we could.”

Senior VP of products/IT for an SAS-based software solutions/research company

This longtime Oracle customer said Exadata was the sensible and obvious choice when it came time to rebuild the

company‟s processing system. The quarter rack cost between $500,000 and $1 million, with annual support fees of

$87,000. Despite a few installation glitches, the firm has been impressed with Exadata‟s speed and ability to crunch

data reliably. Jobs that used to take several days now run in minutes. Its processing power has enabled the firm to accept

jobs that previously would have been too difficult, and its ability to create new data sets is leading to additional services

and revenue streams. He could not comment on competitors such as Teradata or IBM, but viewed the open-source

Apache Hadoop project as a potential threat. The source reported no immediate

plans to purchase more from Oracle, but he did not rule it out either. He believes

the Database Appliance has strong market potential as a gateway to processing

upgrades and a way to lure new customers into Oracle‟s stable.

“In general, we are happy with the experience and the Exadata

machine. We have been with Oracle for a long time, and our existing

solution was a regular server with Oracle/Linux. We decided to get the

Exadata because we were in the process of redesigning our processing

and rebuilding our system to improve our analytic offerings. We needed

more power to calculate a lot of information.”

“Because our business relies on software and is very focused on

database processing, we did not want to just add more servers. You

basically have two choices. You can go the Google route and have huge

server centers, but Oracle‟s way is much faster and more efficient.”

“We bought a quarter rack. I can‟t comment on the exact price, but it

cost us over half a million and less than one million. It will cost us

$87,000 a year for premium support. We don‟t have any immediate

plans to get another one, but we are not at all against getting another

one.”

“The increased speed has been impressive and the machine reliable,

which is important to us because we only have two database

administrators. We had one job that normally took us 20 days to run,

and with Exadata, we could run it in one hour. We are using it on a lot

more jobs than we originally intended because of its performance and

speed. Another job that took us multiple days before now runs in minutes.”

“In another case to test the speed differential, we had a job that required analysis of 10 million records. It was

not a simple job because it was recursive. To process the data on the Exadata took 14 days. The same job using

a dual-quad with 2.9 gigahertz and a Dell with 96 gigabytes took 74 days. And on a small system with 32

gigabytes of RAM and 2.6 gigahertz, it took 120 days. So you can see the speed of the Exadata is dramatically

faster than what we had before. And it‟s reliable.”

“We are not using it in the classic way a company might use it. We are using it as a data factory, and it also has

been able to create new data that goes into our system. When I say we are using it as a factory, I mean we are

using it to aggregate because we get data from maybe 33 different sources, like the U.S. Census.”

“We did at one point look at going with a shared memory system with NetApp [Inc./NTAP], similar to VMware

[Inc./VMW]. The Exadata was 25% more in cost, but we felt justified at the time in spending more. In hindsight, it

was worth it. There is not a lot of stuff to learn, so it‟s a small learning curve to change. We also ended up buying

the NetApp.”

“Is it saving money? Let‟s just say we would not be able to do without it. Since we are not using it as an order

entry system, I cannot speak for whether others are saving money, but in the right environment it could save

The increased speed has been

impressive and the machine

reliable, which is important to

us because we only have two

database administrators. We

had one job that normally took

us 20 days to run, and with

Exadata, we could run it in one

hour. We are using it on a lot

more jobs than we originally

intended because of its

performance and speed.

Another job that took us

multiple days before now runs

in minutes.

Senior VP of products/IT

SAS-based Software Solutions Co.

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some companies money. But that is not how we are using it. We did

save some [electricity] power, space and cooling costs because we

didn‟t have the extra servers.”

“Does it save space and energy and cooling costs? Absolutely. But the

major reason we bought it was to build new and faster files. If buying

the Exadata only accomplished that, we would be extremely happy with

it. But it has opened up other opportunities for us.”

“Normally, we get such jobs and they have 30,000 to 40,000 records

and it takes 15 days. But we got offered a job with 2 million records

and they wanted it in 15 days. With Exadata we did it in three to four

days. This was a job we never would have been able to take before. In

another case, our online server system went down and there was a

screwed-up piece in the backup system because some hardware was

corrupted. So we shifted all of the data over to Exadata. Its ability to

handle workload and crank out data is incredible. So it has also bailed

us out in some cases while still handling big jobs.”

“As for challenges, we are a longtime Oracle shop, but there was some new technology we had to learn. We

didn‟t know how well we needed to know our data and there was a problem in the Unicode properties. So we

had to change some columns and fields because it was not loading properly. Glitches are generally a problem

with any new technology; they all have issues. But we weren‟t as prepared as we should have been and so there

were some problems because we wanted to do it ourselves. We didn‟t want to hand over our set-up to [Oracle].

Also, some of my people would say the support is not as good as it should be. We had some little problems and

called Oracle, but by the time they got back to us we had figured it out for ourselves.”

“At first, it did not seem to be running as well as we had hoped, but they sent a guy right away and he stayed for

four days to tune it up. But it was nothing that put us behind schedule. The only other issue was that they

shipped the Exadata machine to us on time, but something went wrong with getting the cables. We had to wait

three weeks to get the cables, and the machine was just sitting there idle. They were pretty upset because there

was some sort of a glitch in their internal ordering and supply system, and they didn‟t have cables on hand. But

overall, I would still characterize our experience as a relatively smooth install. Would we do it again knowing

what we know now? Yes.”

“Exadata is allowing us to really change our competitive landscape. Before, customers could buy [our biggest

competitors‟] products or they could buy our services and use us to do the analysis. But with Exadata, [our

competitor] doesn‟t have the capability we now have. Next April, at a conference, we will show customers that

we can do more for them with our system than they can with theirs. Exadata at some point will allow us to add

services and to do stuff that we haven‟t been able to do before. And we will be able to charge additional fees to

create a new revenue stream.”

“I‟m not an IT geek, so I don‟t spend time reading about Exadata competitors. I suppose everything that comes

along is a threat to them. There are a lot of people doing big data

storage. Behind the scenes at Google [Inc./GOOG] there is the Hadoop

server, which is free [open source]. That is probably the most serious

threat. The language is free, and the licenses are free. You just need to

buy the servers. But then you end up with a lot of servers that consume

a lot of power and space.”

“We think the Oracle Database Appliance is a great idea. For $180,000

or so, you get an entry-level system you can use with Exadata. The

Appliance is not Exadata, but you do get a lot of the database

technology that is in the thumb of Exadata. It‟s more of a plug-and-play

device. We would think about getting the Appliance as an interim

device that would take us from where we are now to the next step. If

you want a faster scalable system and just have the rack. The

Appliance uses the notion of flash memory because you are able to

store information and when you want quick access you can transfer it.”

“The people in my group and the CEO felt there would be a real market

for Oracle‟s Appliance. It does not take a lot complexity. I don‟t how big

Does it save space and energy

and cooling costs? Absolutely.

But the major reason we

bought it was to build new and

faster files. If buying the

Exadata only accomplished

that, we would be extremely

happy with it. But it has opened

up other opportunities for us.

Senior VP of products/IT

SAS-based Software Solutions Co.

Exadata is allowing us to really

change our competitive

landscape. … Exadata at some

point will allow us to add

services and to do stuff that we

haven‟t been able to do before.

And we will be able to charge

additional fees to create a new

revenue stream.

Senior VP of products/IT

SAS-based Software Solutions Co.

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a thing it could be, but I think a lot of people could use it. It could have strong appeal, and it would reduce the

learning curve to get into the Oracle world. I suspect it will do very well, and it‟s at a good price point. We

reviewed it and it would have cost us $187,000, all inclusive with a support contract. I had to go to our board to

get approval to buy the Exadata but probably would not have to make the case for a device that only costs

$187,000.”

Database architect at a global hospitality company

This source views the Exadata as the future of data management, especially for organizations that prefer to host their

own data instead of going to the cloud. The transition to the Exadata requires patience, conviction and willingness to

change, but the payoff is more than worthwhile. He believes the Database Appliance will succeed as a less expensive,

less powerful option for smaller companies.

“This is the first true breakthrough in the database world in years. In a

lot of ways it is the salvation of companies like mine that are struggling

with an effective ceiling on the number of accounts and inventory we

have to track on a close to real-time basis.”

“Like any innovation, this one requires customers to demonstrate high

conviction and roll with the changes. It‟s not simply a faster version of

an existing box. It requires IT to rethink the role of the database in the

overall organization. That may initially slow the adoption, and I think it

has.”

“For those organizations that can adapt to the demands of the Exadata

environment, the rewards are huge. As I noted, some of us simply had

to adapt or face the prospect of failure in the near term. There are only

so many servers you can throw at a problem of matching global assets

to customers around the world in real time. We have that problem, the

airlines have that problem, logistics companies definitely have that

problem.”

“In some ways we‟re too big for the cloud. This is almost a third approach between cloud-managed database—

which runs into the same problems I laid out, only faster as far as the cloud manager is concerned—and

traditional storage-oriented database buildout.”

“I think the [Database Appliance] now available lets enterprises ease the fear factor of trying the new

technology. It isn‟t cheap at any level, so the smaller the initial investment needs to be, the more it helps.”

“Once you buy in, storage concerns go away. The big concerns become managing the way the Exadata boxes fit

into the larger network. You‟re really managing around the box and letting the box do its job.”

COO for a leading marketing affiliate network

This source bought two separate halves of Exadata racks about a year ago and has been more than satisfied. Oracle will

continue to expand its Exadata product line in order to make it more reasonable for smaller customers to migrate to the

platform. The new Appliance is only the latest example of this down-market expansion. Deployment was relatively error-

free because he allotted the proper amount of time, and he expects to continue purchasing half racks every few years.

“We bought two half racks last summer in order to split them between two of our data centers. The goal here is

to expand our infrastructure in a balanced way, avoiding situations

where an outage at one data center might end up knocking out all of

our Exadata boxes at once. Redundancy and backup capacity are a

must for our customers.”

“In terms of scale, a single half rack would have worked for us, but we

wanted the redundancy. We were running about 6 terabytes total on

our database then and are now at close to 10 terabytes, which would

theoretically fit on a single Exadata half-rack configuration.”

“Most of Oracle‟s customers are actually in our range. There aren‟t

many petabyte-level organizations out there, and I‟ve been told most of

the world is still running at well under 10 terabytes. That‟s just the

database, of course, but then again, Exadata is just the database

housing.”

This is the first true

breakthrough in the database

world in years. In a lot of ways it

is the salvation of companies

like mine that are struggling

with an effective ceiling on the

number of accounts and

inventory we have to track on a

close to real-time basis.

Database Architect

Global Hospitality Company

We will probably keep buying in

two half increments every few

years until something better

comes along. But in the

meantime our needs are more

than met.

COO, Leading Marketing Affiliate

Network

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“Opening up the configuration to allow half and now fourth rack purchases helps people like us that are adding

massive amounts of data—200 gigabytes a month—to the database, but are still not growing exponentially. The

new version makes it even easier to bring the offering down to smaller organizations although it‟s a lot of power

for a small company—probably more than they need.”

“We will probably keep buying in two half increments every few years until something better comes along. But in

the meantime our needs are more than met.”

“Installation and integration were relatively painless. These things always take a few weeks to a few months

longer than you think, but we allocated plenty of time for overage. One thing to point out is we were one of the

first organizations to use a third-party service bureau to set up our systems. I think there‟ve been a few others

since. We like Oracle, but didn‟t need the full service bill direct from the „mother ship.‟”

Database architect for an emerging markets wireless carrier

This source has consolidated 11 full racks of x86 servers into three racks of Exadata boxes. He characterizes

performance improvement as 10 times what his old hardware provided.

“We are happy customers and vocal evangelists of the technology. It sped up our customer billing by about

tenfold, and with 34 million subscribers, that improvement in processing power pays for itself.”

“We knew there were other solutions out there, but none offered the integrated storage and data analysis that

the Exadata does. It‟s the difference between choosing between several general-purpose machines and a highly

specialized solution for a highly specialized function.”

“We might have had a bit of an advantage in that our previous configuration was aging quickly, so it made sense

for us to replace it and upgrade our capacity at the same time. At our size, the pricing was surprisingly attractive

compared to simply replacing the old servers and buying more. It let us jump a step in the upgrade process from

somewhat antiquated servers to the best out there.”

“We are one of the enterprises for whom the Exadata storage solution was made. That is our upgrade path.”

Chief Oracle architect at a global technology consulting company

This source uses a fourth-rack Exadata as a staging server for client engagements. It delivers better speed than his in-

house solution, while adding capacity and efficiency. He appreciates the technology‟s built-in integration with Oracle

software, but notes that this limits the effective market to Oracle users. He had some qualms about the future of the Sun

Microsystems architecture that runs the system.

“We compete with Oracle in some markets and cooperate with them in others. Obviously, I‟m a cooperator, and

for my practice Exadata can deliver better outcomes than our own in-house technology. Naturally, my practice

has already selected into an Oracle environment, so it‟s natural that their technology glide path would point

toward an Exadata deployment.”

“The engineered technology allows not only relative miracles of speed—

jobs that took weeks or even months now take days—but scale. We

have been reaching the limits of database scalability in the last few

years with social networking and CRM applications that generate

hundreds of millions of rich, multidimensional records. Exadata

extends the life of the database by adding capacity, but more

importantly, making the entire database more efficient.”

“For Oracle processing, Exadata is the obvious choice. I haven‟t

benchmarked it against our in-house technology, but our technology is

oriented toward providing a different class of solutions. Exadata is for

real database-intensive enterprises that have to perform more

automated analysis. In effect, their customer database becomes their

transaction platform. For traditional search and analysis, other

solutions may offer a cost-competitive alternative.”

“Some people are wary of the fact that this machine is built out of Sun

hardware. They don‟t mind being on a SPARC machine but worry about

the long-term viability of the architecture. Will Oracle support it beyond

the next three or four years? Given the price point here and the fact

that these machines need to last more than three or four years, it‟s an

important question.”

Exadata can deliver better

outcomes than our own in-

house technology. … The

engineered technology allows

not only relative miracles of

speed but scale. We have been

reaching the limits of database

scalability in the last few years.

… Exadata extends the life of

the database by adding

capacity, but more importantly,

making the entire database

more efficient.

Chief Oracle Architect

Global Technology Consulting Company

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“We bought our Exadata as soon as the small-scale deployment became available since we really only needed a

proof-of-concept testing environment. Installation went smoothly since we work really well with their people and

needed a pure vanilla deployment. Customization would have only made it useless for our purposes. I‟ve heard

some customers are unhappy about the long integration process.”

Head of information management for a major billing services vendor

This source bought a half Exadata rack in order to woo potential utility customers. He is excited about the technology and

considers it the only way to make true smart-grid computing possible.

“We have a small investment in Exadata hardware, largely as a showpiece for our conversations with leading

utility companies looking for a way to implement the smart grid. In the meantime, the box hosts our internal

systems analytics and other higher-level functions we need for running our own databases.”

“The best way to characterize our deployment is as a version of the solid-state drive that runs the performance-

intensive functions while the bulk of the data lives on traditional hard drives. It can be slower because it‟s not as

performance-intensive or frequently accessed, so it can remain in the older and cheaper media.”

“The exciting thing is going to be engineering larger systems that run on an Exadata or other super-server but

are not built exclusively out of super-servers. Buying and linking three racks of these machines creates a small

and profoundly high-performance network, but it‟s also a profoundly expensive network. The analogy of the sliver

of high-grade solid-state flash driving the file server is appropriate here. That flash is incredibly expensive at the

densities you need, so it makes more sense to round out the system with older alternatives.”

“Smart grid needs something like this hybrid system because utilities are cheap. They operate under significant

capital constraints, so aren‟t interested in dropping $3 million or $10 million on an all-new Exadata network.

They‟re all about buying only what‟s truly critical. That‟s a problem with the smart grid because you need so

much scale to control all the meters and their data flow, not to mention the very sophisticated billing.”

“Ironically, of course, they don‟t actually care about the power footprint because they are the power company.”

Director of enterprise business solutions for a global IT firm

This source bought several Exadata boxes to incorporate into his company‟s cloud processing business. The technology

has shown a noticeable improvement in managing large amounts of data. The decision to go with Exadata was largely

customer-motivated as they wanted faster processing power. The purchase is only weeks old and integration is still going

on, but the source reported no problems to date.

“It wasn‟t a choice for us. We have quite a few enterprise customers

who wanted extremely fast and scalable database processing power,

and since their systems are remotely housed in our data centers, they

needed the ability to do complex searches from across the earth. They

suggested the Exadata on their own.”

“I think the rationale for them was that they use Oracle as the front

end, so wanted a vertically integrated solution all the way down to the

hardware. We were happy to oblige since at the end they‟re the ones

paying the bill.”

“It‟s not a true, enhanced warehousing solution. There are other

machines that excel at pure storage of mostly cold data. Exadata is

best at working with active accounts and manipulating large amounts

of more frequently accessed data. The performance gain there is very

noticeable.”

“Fewer machines mean less maintenance and more power

conservation, which is critical here given the state of the power grid

already. Each Exadata machine is more expensive, but that‟s the way

of server evolution. The best practices always require the most

advanced hardware, which is most expensive.”

“And the biggest enterprise customers need the best practices because they‟re already at the limit of what

standard practices can deliver.”

“We only accepted delivery a few weeks ago and are still integrating our racks into our cloud architecture. So far

there have been no problems, unlike what you hear about the earlier versions.”

We have quite a few enterprise

customers who wanted

extremely fast and scalable

database processing power,

and since their systems are

remotely housed in our data

centers, they needed the ability

to do complex searches from

across the earth. They

suggested the Exadata on their

own.

Dir. of Enterprise Business Solutions

Global IT Firm

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DBA for a retail food/beverage chain with branded stores and grocery products

The company recently purchase its third half Exadata rack and now is able to process and analyze data and conduct

operations previously out of reach on its older, outdated system. Challenges include a slight learning curve, especially for

DBAs less familiar with Oracle. Exadata is unique and cannot be compared with competitors such as Teradata.

“Roughly one year ago we bought and installed two half Exadata racks, and then recently we added to it and we

now have one full rack and a half rack. We were already on an Oracle rack system and platform. It was pretty

standard with Oracle software and HP [Hewlett-Packard Co./HPQ] hardware [server] so Exadata was a logical

extension and it was not as big a task to make the switch. We are using it for data warehousing and analytics.

The other system [HP] is no longer in use.”

“Before making the purchase, we did consider other options because

we do have a multitude of systems that we use here. Oracle is just one

of our platforms.”

“As advertised, it can do things that previously we could not do on our

existing systems. With big data, you have billions of rows of

information/data and that‟s really where Exadata shines. Dealing with

billions of rows of data is right up its alley.”

“Almost anything runs faster on Exadata, and it‟s hard to quantify

because of the system we had before. The processing is such that you

have to know how to leverage its unique characteristics so that it

moves faster or as fast as possible.”

“With Exadata, you still have to know how to take advantage of its

special features and how to leverage its power. There are things you

can do that would make it operate less smoothly. At the storage layer,

there are things Exadata can do with processing and churning the data, but when you operate it you have to

know how to take advantage of the smart scan. You have to know how to customize somewhat. Almost anything

runs faster on Exadata.”

“We no longer use a SAN, but we have other hardware in its place. I have seen presentations by Oracle that

promote its compression and ability to save space. And it‟s important for every data center not to proliferate. But

we weren‟t really bringing it in to consolidate in this case. We chose it to do something we couldn‟t do before

analytically.”

“One benefit, for example, is that at night we have to load the processor for the next day. As soon as we turned

on the Exadata, we noticed a difference. Before we would load data from midnight and end at about 6 a.m. But

now we‟re finished at 4 a.m. So we immediately gained time without making any code changes and right out of

the box. That in itself took some real pressure off the staff.”

“There have been some challenges. With the adoption of any new technology, you have to figure out or

understand what to view as wrong or what to view as right. There is always some noise. So there is a learning

curve, but I would say the learning curve is about average. It does help if you have worked with Oracle before

because there is always some degree of learning. That‟s the way it is with Oracle.”

“Has it helped our business overall? Yes.”

“The only competition out there is between Teradata and Netezza. They

are the only other ones in the data warehousing space. There are other

competitors outside of that if you pitch Exadata also as a database. But

either way, there are differences and it is unique. It is a different

animal. No one is really doing the offloading to the storage system that

Exadata does.”

“I was reading a new book about Oracle and Exadata and in the very

first chapter they ask the question „Can you build your own?‟ And you

can‟t. Oracle locks others out of building their own. They have in there

what people are calling the „secret software‟ that can talk to the

storage layer and do its own offloading. That‟s why you can‟t go out and

do it yourself. There really is no competition out there with a way of

doing that.”

As advertised, it can do things

that previously we could not do

on our existing systems. With

big data, you have billions of

rows of information/data and

that‟s really where Exadata

shines. Dealing with billions of

rows of data is right up its alley.

DBA, Retail Food/Beverage Chain

There is a learning curve, but I

would say the learning curve is

about average. It does help if

you have worked with Oracle

before because there is always

some degree of learning. That‟s

the way it is with Oracle.

DBA, Retail Food/Beverage Chain

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“I don‟t see how Hadoop is a competitor. It doesn‟t follow the rules of the ACID [atomicity, consistency, isolation

and durability] test. Although I did hear of someone who was running Hadoop on Exadata. But, still, you have to

have the Exadata.”

Secondary Sources

These five secondary sources were focused on the changing administration dynamic in IT departments as a result of Exadata,

praise for the new device, details on cost and payment structure, and inputs on Database Appliance for SMBs.

Oct. 4 InfoWorld.com article

Oracle‟s Exadata machine requires constant administration, necessitating the learning of new skills and a new form of

database implementation. For decades, database implementation has been done through somewhat segregated jobs,

with employees such a server technicians and networking experts playing individual roles. However, Oracle‟s Exadata

technology requires a role for someone to oversee the whole process.

http://www.infoworld.com/d/business-intelligence/oracles-exadata-means-changes-dbas-174953

“Oracle‟s Exadata database machine can deliver the performance improvements the vendor claims, but also

demands that IT shops and database administrators undergo a shift in thinking as well as attain new skills, a

number of experts said this week at the OpenWorld conference in San Francisco.”

“Oracle intends Exadata to be the new reality for its customers, with it serving as a consolidation point for large

numbers of disparate servers and data stores.”

“For decades, IT shops have been dealing with database

implementations through "somewhat segregated" jobs, with server

technicians, networking experts and database administrators playing

individual roles, said Andy Flower, managing director of Right Triangle

Consulting, during a session at the show.”

“But Exadata‟s tight integration between those components presents a

challenge to the status quo. „You have to have a role that manages the

whole thing,‟ he said. „The technology makes it as such that you have

to administer them in constant.‟”

“There aren‟t „clear answers, but there are indications‟ as to which type

of employee is best suited to oversee an Exadata installation, he said.

„People with DBA experience are more likely to put their head around

the whole problem space, because they‟ve been dealing with data

rather than dealing with machines.‟”

“Arup Nanda, principal global database architect at Starwood Hotels

and Resorts Worldwide, has willingly embraced his new role.”

“Nanda now refers to himself as a „DMA,‟ or database machine administrator, he said during a session that

explored Exadata‟s architecture in great detail.”

“Similar sentiments were expressed during another session by Vinod Haval, vice president and database

product manager at Bank of America.”

“The bank is running two critical applications on Exadata, Haval said. Overall, the project has been „a

tremendous success from the performance perspective,‟ and will also provide great savings on storage thanks

to Exadata‟s advanced compression capabilities, he said.”

“But Oracle „was walking with us hand-in-hand through the process,‟ he added. „We had to make sure we had

the right skills internally.‟”

“If one were to break down the skill set of a solid Exadata administrator, it would constitute 60 percent

database expertise, 20 percent with storage and another 20 percent or so with Linux and UNIX, Haval said.”

“Remote database administration provider Pythian Group has been aggressively moving into the Exadata

business. The Ottawa, Ontario, company was recognized by Oracle this week for its work implementing and

managing an Exadata system for online marketing company LinkShare.”

“Enterprise IT shops that decide against hiring specialists like Pythian to help them with Exadata can be

successful if the right elements are in place, said Paul Vallee, founder and executive chairman, in an interview.”

Oracle‟s Exadata database

machine can deliver the

performance improvements the

vendor claims, but also

demands that IT shops and

database administrators

undergo a shift in thinking as

well as attain new skills, a

number of experts said this

week.

InfoWorld.com Article

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“Companies can train their DBAs on Oracle‟s Linux distribution, get them Exadata training certifications „and

accept the incremental risk,‟ he said. „You could also try to hire away an Exadata specialist, but good luck,‟

Vallee added.”

“The ideal target for an Exadata administrator is a solid DBA „with a

special interest in the systems side‟ as well as areas like data modeling

and an understanding of Oracle‟s various clustering technologies,

Vallee said. „Then I think the learning curve is manageable.‟”

“CCC Information Services, which offers a variety of software

applications that help auto insurance companies manage and evaluate

claims, is about to undertake an Exadata implementation.”

“CCCIS is doing some staff shuffling in anticipation of Exadata‟s

management responsibilities, said Patrick Traynor, vice president of

architecture, in an interview. „We‟re in the planning stages and we feel

pretty good about it.‟”

“CCCIS did not do a full proof-of-concept exercise for Exadata before it

bought the system, but had extensive conversations with existing

customers, according to Traynor.”

“The company is eagerly anticipating the performance boosts and

storage savings Exadata is supposed to provide, but there‟s more to the investment than that, said Chetan Ghai,

senior vice president of global marketing and product strategy.”

“Exadata should give CCCIS some headroom to roll out new applications, especially ones with predictive

capabilities that can save insurance carriers money and streamline claims processing, he said.”

July 21 TDWI.org article

An industry commentator reviewed version 2.0 of Exadata and praised the device for its ability to improve speed, lower

costs and offer a potential for tasks that have not yet been realized, including Enterprise Performance Management.

http://tdwi.org/articles/2010/07/21/oracle-exadata-v2.aspx

“Veteran industry watcher Merv Adrian recently took an in-depth look at Oracle Corp.‟s Exadata version 2.0—aka,

the Oracle Sun Database Machine.”

“Adrian liked what he saw. He says the revamped offering‟s combination of features—cutting edge storage (SSD

and Flash Cache), high-performance I/O (which exploits solid state storage to reduce latencies and increase I/O

operations), and a quasi-analytic database architecture (Oracle‟s „Hybrid Columnar Compression‟)—achieves a

kind of gestalt effect in which the Exadata V2 whole is considerably greater than the sum of its parts.”

“„The real „secret sauce‟ of Oracle Exadata V2 is the way in which these technologies complement each other to

deliver additional performance and scalability,‟ writes Adrian, a principal with IT Market Strategy.”

“„Traditionally, server, storage, and database technologies from different vendors achieved excellent

optimization within their own spheres, but that optimization often worked at cross-purposes with other parts of

the data-management architecture,‟ he continues. „[D]atabase and

storage vendors have traditionally optimized data storage for different

user needs, so that a [SAN] … solution aimed at remote-PC document

and video data could undercut the optimization of a data-warehouse

data store.‟”

“Exadata V2 serves up a more synergistic arrangement, Adrian notes.

This could help explain Oracle‟s extremely optimistic performance

claims.”

“„In querying, the [Exadata] database engine works in concert with the

storage solution, with server and storage being allocated query tasks in

a version of load balancing across CPU, SSD, and disk-array

processing,‟ he explains. „Storage allocation and compression are

integrated between the storage manager and the database engine. The

CPU can operate on less data, as retrieval is assisted by pushdown

processing in the storage layer.‟”

“Adrian also lauds Exadata‟s workload management capability. Data

warehousing stalwart Teradata Corp. likes to trumpet its own workload

The ideal target for an Exadata

administrator is a solid DBA

„with a special interest in the

systems side‟ as well as areas

like data modeling and an

understanding of Oracle‟s

various clustering technologies,

Vallee said. „Then I think the

learning curve is manageable.

InfoWorld.com Article

He says the revamped

offering‟s combination of

features—cutting edge storage,

high-performance I/O, and a

quasi-analytic database

architecture—achieves a kind of

gestalt effect in which the

Exadata V2 whole is

considerably greater than the

sum of its parts.

TDWI.org Article

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management expertise, which it says permits its DW platform accommodate a mix of different workloads—and

prioritize certain workloads based on the roles, responsibilities, or needs of users. For a while now, rival Hewlett-

Packard Co. (HP) has been making similar claims about its Neoview DW platform.”

“More recently, vendors such as analytic database specialists Kognitio, Netezza Inc., and Vertica Inc. have

trumpeted their own mixed workload bona fides. Although none of these players (with the exception of HP)

claims to offer Teradata-like workload management, all claim to achieve good enough service (in some cases,

they claim, by virtue of the superior speed of their analytic database platforms) for most users.”

“Oracle, too, likes to claim that it can consider the goods—i.e., adequate query response times and availability

levels that are appropriate to user classes or roles—mixed query-wise. If

nothing else, Adrian writes, Exadata V2 seems to have the makings of a

mixed workload performer.”

“„[W]hile complex-query data-analysis solutions use hybrid-columnar

technology up and down the integrated stack to deliver deeper analysis

on smaller, compressed data sets that have been rapidly pre-filtered by

smart storage, Oracle Exadata‟s OLTP write-heavy solutions can take

advantage of the new SSDs to process transactions faster, with fewer

buffer flushes, and less forced swapping to disk,‟ he points out.”

“Adrian offers an assessment of Exadata V2 as part of a new wave of

category-inaugurating devices. „[T]he potential of Oracle Exadata lies in

its ability to do what is already being done, but faster and cheaper, or in

the assurance [for existing or prospective customers] that they may

now be able to keep ahead of ever-growing demands for more data,‟ he

comments. “But an equally significant—and perhaps more exciting—use

of Oracle Exadata is the promise of using its raw power to do

something that hasn‟t been done before. One example of this might be

Enterprise Performance Management.‟”

“EPM, according to Adrian, has a much more ambitious scope than

vanilla business or corporate performance management.”

“„Twenty years ago, it might take a month to do a yearly plan for a large-

scale enterprise, and a month to record the quarterly „actuals‟ and

come out with a quarterly set of balance sheet, income statement, and

cash analysis,‟ he explains. „Today, consolidation of weekly results from

a 150-line-of-business global enterprise, followed by comparison with

plan, replanning, and rebudgeting, can be done in less than a working

day.‟”

“The takeaway? New and hitherto unimaginable responsiveness, according to Adrian. „This speedup means that

enterprise-wide plans are not cast in concrete for a full year; they can be modified, drastically if necessary, on a

monthly or even weekly basis, when the organization changes strategy in midstream,‟ he continues. „But the real

new EPM application potential is in using deeper what-if analysis during the consolidation process to drive more

granular plan/budget modifications.‟ In other words, Adrian concludes, an offering like Exadata makes it

possible for „EPM to move surprisingly close to real-time reaction to events.‟”

Sept. 22 Silicon.com article

Oracle is launching Database Appliance, aimed at SMBs. The new product will offer the same general functions as

Exadata but on a smaller scale.

http://www.silicon.com/technology/hardware/2011/09/22/oracle-gives-exadata-a-little-brother-with-launch-of-

database-appliance-39747990/

“Exadata now has a younger sibling after Oracle launched its Database Appliance.”

“Like Exadata, Database Appliance is a combination of servers, storage and networking kit coupled with Oracle

software. And, like Exadata, Oracle‟s predicting it will be put to work for OLTP, consolidation and data

warehousing uses.”

“However, unlike Exadata, Database Appliance is aimed at the mid-market: small and medium businesses and

departmental systems.”

[T]he potential of Oracle

Exadata lies in its ability to do

what is already being done, but

faster and cheaper, or in the

assurance [for existing or

prospective customers] that

they may now be able to keep

ahead of ever-growing

demands for more data,‟ he

comments. But an equally

significant—and perhaps more

exciting—use of Oracle Exadata

is the promise of using its raw

power to do something that

hasn‟t been done before. One

example of this might be

Enterprise Performance

Management.

TDWI.org Article

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“Database Appliance, which Oracle has dubbed a „database hardware cluster in a box,‟ comes with two servers,

12TB of total storage (4TB of usable storage, triple-mirrored) and is loaded with Oracle software including the

company‟s 11g Enterprise Edition database product, as well as Oracle Linux and Oracle Appliance Manager.”

“Oracle customers will be able to transfer existing [licenses] onto the system, according to the company.”

“While the Database Appliance will be sold in single a hardware configuration, businesses can [license] software

for it according to demand—from an initial two cores up to a maximum of 24. Equally, [licenses] can be scaled

back down again if cores are no longer needed.”

Sept. 19 ZDNet article

The Database Appliance could bring Oracle‟s products more mainstream and add $1 to $2 billion in revenue.

http://www.zdnet.com/blog/btl/oracles-exadata-mini-would-aim-for-midmarket/58312

“Oracle is prepping an Exadata mini appliance geared toward mid-market customers, according to an analyst.”

“The company is expected to unveil this Exadata mini at its OpenWorld conference in October, said Piper Jaffray

analyst Mark Murphy. It‟s unlikely that Oracle would call its latest Exadata a „mini,‟ but Murphy said it‟s the best

he could come up with to highlight that the company is launching a lower end version of its database appliance.”

“In a research note, Murphy wrote:

o Our checks and analysis indicate Oracle will introduce an Exadata “mini” box at its OpenWorld user

conference in October. The device is a mid-market database appliance designed to be extremely easy

to manage and small enough to sit underneath a desk. We estimate a price point of $100K-$200K,

well below Exadata prices of $500K-$2.5M. This is an important strategic move for Oracle because

thus far, Exadata‟s price tag has created sticker shock for all but the very largest organizations.”

“If Oracle follows through on its midmarket Exadata box, Murphy estimated that the company would garner an

extra $1 billion to $2 billion in revenue.”

“More importantly, Oracle would be able to make its Exadata machines more mainstream. Among some of the

details via Murphy:

o The Exadata could fit under a desk;

o Customers wouldn‟t need a database admin to maintain the Exadata environment;

o The focus of the Exadata mini would be ease of management over running complex enterprise

applications.”

“Add it up and Oracle seems to be making a play for the SMB market, which has traditionally be Microsoft‟s turf.

In addition, this new Exadata box could expand Oracle‟s server market share, which is just above 7 percent

through the second quarter, according to IDC.”

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Sept 18 Oracle Optimization article

Oracle has a list price of more than $1 million for its Exadata machine but prices software separately.

http://oracleoptimization.com/2011/09/18/exadata-pricing/

“A reader asked that we cover how Exadata is priced.”

“It‟s important to note that Oracle is somewhat unique in that list pricing for Exadata and the associated

software is publicly available. Not that it matters much since discounting makes millions of dollars of difference

between what is published and what you may end up paying. On that

note, each of the four Exadata flavors has been added to Simple Quote

via the new drop down menu. This makes assessing how software

discounts will affect your mileage significantly easier.”

“In any case, Exadata pricing is a lump sum for an integrated stack of

servers, storage, network and operating system. X2-2 Full Rack, for

example, has a list price of $1,100,000.00. A keen eye notices that the

three support fees add up to 22% of the machine price, which is the

standard software support fee structure. This reminds me of when

Oracle kept update and support fees separate.”

“Here‟s the important part: software is sold separately, as noted in the

marketing literature. This means that pricing software for Exadata is

the traditional method of applying core factors to calculate how many

Processors for the database and extra-cost options you want. Licenses

for Enterprise Database, RAC, Management Packs, etc., that are sitting

on the shelf or being freed up from retiring existing workloads may be

transferred to Exadata. The only new gotcha is Exadata Storage

Software that is licensed per Disk Drive.”

“Exadata is a clear picture of how Oracle likes to operate. First, it has

simplified the bill of materials. This same stack of gear in the best of

breed model would be dozens of SKUs; for Oracle, it is one. Second,

Oracle has protected it‟s maintenance revenues by not including the

database software in the stack pricing. Otherwise customers could terminate expensive maintenance

agreements in return for a better discount on new software. Finally, Oracle is promoting itself as the first to think

of engineering hardware and software to work together from the factory. In reality, Oracle works with HP, IBM

and Dell to optimize it‟s products on other stacks.”

Next Steps

Blueshift‟s next report on Exadata will include a silo of sources who have not adopted Exadata to learn if they are entertaining

plans to make a switch. This will provide insight as to whether Exadata is adding to Oracle‟s business or simply serving as a

migration pattern for existing customers. We also will speak with sources who have purchased the Database Appliance to

learn how the product is faring with its intended audience and if it is adding SMBs to Oracle‟s client list. Lastly, we will explore

whether Exadata is hurting former Oracle partners such as EMC, IBM, Cisco and Dell.

Additional research by Carolyn Marshall and Scott Martin

The Author(s) of this research report certify that all of the views expressed in the report accurately reflect their personal views about any and all of the subject securities

and that no part of the Author(s) compensation was, is or will be, directly or indirectly, related to the specific recommendations or views in this report. The Author does not

own securities in any of the aforementioned companies.

OTA Financial Group LP has a membership interest in Blueshift Research LLC. OTA LLC, an SEC registered broker dealer subsidiary of OTA Financial Group LP, has both

market making and proprietary trading operations on several exchanges and alternative trading systems. The affiliated companies of the OTA Financial Group LP, including

OTA LLC, its principals, employees or clients may have an interest in the securities discussed herein, in securities of other issuers in other industries, may provide bids and

In any case, Exadata pricing is

a lump sum for an integrated

stack of servers, storage,

network and operating system.

X2-2 Full Rack, for example,

has a list price of

$1,100,000.00. A keen eye

notices that the three support

fees add up to 22% of the

machine price, which is the

standard software support fee

structure. This reminds me of

when Oracle kept update and

support fees separate.

Oracle Optimization Article

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offers of the subject companies and may act as principal in connection with such transactions. Craig Gordon, the founder of Blueshift, has an investment in OTA Financial

Group LP.

© 2011 Blueshift Research LLC. All rights reserved. This transmission was produced for the exclusive use of Blueshift Research LLC, and may not be reproduced or relied

upon, in whole or in part, without Blueshift‟s written consent. The information herein is not intended to be a complete analysis of every material fact in respect to any

company or industry discussed. Blueshift Research is a trademarks owned by Blueshift Research LLC.