September 20, 2010

Some thoughts on the announcement that IBM is buying Netezza

As you’ve probably read, IBM and Netezza announced a deal today for IBM to buy Netezza. I didn’t sit in on the conference call, but I’ve seen the reporting. Naturally, I have some quick thoughts, which I’ve broken up into several sections below:

First, the underbrush:

Now, the speculation about the technical and/or business evolution of Netezza and IBM data warehousing, assuming IBM indeed winds up being the Netezza buyer:

So who else could bid for Netezza?

So where does the analytic DBMS market go from here?

Comments

19 Responses to “Some thoughts on the announcement that IBM is buying Netezza”

  1. IBM to acquired Netezza | Analytics Team on September 20th, 2010 9:24 pm

    [...] check out DBMS2 for some [...]

  2. Robert Eve on September 20th, 2010 9:26 pm

    Curt – Cogent, concise analysis! A good service to your clients and extended followers. Thank you.

  3. Curt Monash on September 20th, 2010 10:24 pm

    Thanks for the kind words, Robert! And you’re welcome!

  4. M-A-O-L » IBM Netezza Update on September 21st, 2010 12:49 am

    [...] on IBM Buying Netezza, Sending Clear Shot Across Oracle’s Bow, and there’s Curt Monash with Some thoughts on the announcement that IBM is buying Netezza. Curt also spells out that there’s a breakup fee of around 3%, meaning somebody else could [...]

  5. Joe Harris on September 21st, 2010 5:26 am

    I agree that Netezza will likely have to remain separate from DB2 for the medium term, however I would expect IBM’s technical focus would be towards making NZ ‘code compatible’ with DB2 in the short term.

    If IBM/DB2 has any traction in the DW market, then it’s in Finance and Manufacturing. A lift and shift NZ option would be a boon for customers struggling to scale DB2 warehouses. Not to mention a real headache for Teradata’s sales reps.

    How do you rate the chances of IBM using Netezza as the platform for an “Exadata-killer” DW-OLTP hybrid rack system?

  6. Curt Monash on September 21st, 2010 7:07 am

    Joe,

    The idea of using Netezza in a hybrid OLTP system is ludicrous UNLESS you assume two different databases (one each managed by DB2 and Netezza) with great data movement between them. I.e., it’s not just a matter of two-way integration between DB2 and Netezza — it’s more like three-way between DB2, Netezza, and DataStage.

  7. Ajay Ohri on September 21st, 2010 7:23 am

    Netezza /SAS would definitely give way to Netezza/SPSS – I wonder what this would do to Netezza efforts to use R on the appliance. It was the foremost BI vendor pushing R Analytics/Stats on the BI world

  8. IBM Acquires Netezza – ADBMS Consolidation Heats Up on September 21st, 2010 9:13 am

    [...] territory for IBM, though Curt Monash, as always, offers some perceptive speculations in his post, including the likelihood that SPSS will displace Netezza’s SAS partnership. While I agree, [...]

  9. Walter Smithers on September 21st, 2010 1:51 pm

    Hi Curt – Nice writeup you covered all the questions I had about this deal as well as possible “next moves”. It will be interesting to see what further consolidation takes place particularly in the columnar space as there seems to be a few players and no real winners yet to handle the lower tier DW space.

    Cheers!

  10. Walter Smithers on September 21st, 2010 1:51 pm

    Hi Curt – Nice writeup and you covered all the questions I had about this deal as well as possible “next moves”. It will be interesting to see what further consolidation takes place particularly in the columnar space as there seems to be a few players and no real winners yet to handle the lower tier DW space.

    Cheers!

  11. sql examples | Big Data innovation marches on on September 21st, 2010 6:36 pm

    [...] deals include EMC/Greenplum Teradata/Kickfire and now IBM/Netezza.  A good breakdown of this deal is on Curt’s blog.  There is still more to go of course with one of the crown jewels, Vertica, still ripe for the [...]

  12. ParAccel And NetApp Partner To Offer High Performance Analytic Database on September 22nd, 2010 1:08 am

    [...] Some thoughts on the announcement that IBM is buying Netezza (dbms2.com) [...]

  13. ikke on September 22nd, 2010 1:18 am

    Curt,

    sometime ago we did a POC for our company that also included netezza. We were very interested in the technology but it didn’t get chosen because the benefits weren’t big enough to introduce a new DB-standard (we’re now oracle only). I think this is somewhere where IBM can leverage a lot. It is indeed ludicrous to use Netezza as hybrid OLTP/DW. But if you have a system that looks like DB2 to the end-user both for oltp and DWH you gain some standardization accross the company (like Oracle used times-ten as an in-memoryfront-end which is semi-transparant, this way you would have an OLTP semi-transparant in your DWH). I think the 2 parts should not be sync’ed with datastage but on a lower level(streaming technology).
    Even if there are no plans for a real merge of the technologies I think DB2 can be altered to use the fpga concept. The idea of offloading logic close to the storage layer is correct (allready stolen by exadata) and can be integrated in a DB2-appliance.
    On the netezza side I think a lot can be gained by implementing the broadness of sql-possibilities in the DB2 environment.

    On a broader aspect I mainly wonder what this means for teradata.If both IBM an Oracle get succesfull appliances (and is there maybe an SAP Sybase IQ appliance on it’s way?) I’m not sure if they can survive independently

  14. Curt Monash on September 22nd, 2010 9:05 am

    Well, I’m sure that Netezza has some expertise in using FPGA technology that isn’t obvious to other DBMS vendors. On the other hand, before too many more product generations, the FPGA will probably be replaced by standard microprocessors anyway.

    I do believe in predicate pushdown, for disk-based and solid-state implementations alike. But to date the DB2 architects have disagreed, and I’m not convinced that owning Netezza would lead them to suddenly change their opinion.

    Good point on the lower-level streaming. I was being sloppy about that part.

    Thanks,

    CAM

  15. Where I’m at | DBMS 2 : DataBase Management System Services on September 23rd, 2010 9:51 am

    [...] that won’t change. Of course, the clients may change. After all, my biggest client is being acquired by IBM,  my 2nd-largest was acquired by EMC, a small one was acquired by SAP, and another small one [...]

  16. Mike Pilcher on September 25th, 2010 5:36 am

    Curt

    great article. I have some comments on this, and while I freely raise my hand and say I work for a software company and so am biased, that does not mean I am wrong. One can be biased and right, they are not mutually exclusive.

    I know I talk about vendors no-one seems to remember and the grey hair on my head seems to be multiplying these days, but is the cloud that different from IBM’s time sharing? Are appliances really the new software or is that so last Thursday? Unlike other posts I have seen I am suspect you are as sold on the idea of appliances as others, so perhaps some of this will resonate.

    It seems like just the other day I was shaking my head at the determination of relational database vendors to keep fine-tuning their legacy software in order to optimize it for dedicated proprietary hardware. In essence, to deliver the last drips of performance by acquiring huge alloy wheels, an enormous spoiler, new carbs, a noisy exhaust pipe, and painting flames down the side of their database. To the outside world it looks like it should go fast, but inside there’s still the same rickety old steam engine under the hood. 


    This is very similar to what I recall from my first days in the database market. IBM and the big box vendors, ICL, Unisys, etc. had a stranglehold on the market with file technology that was two decades old. Remembers IMS, IDMS, TOTAL? They all held COBOL as the centre of their Universe. COBOL did deliver secure, scalable, and reliable environments. It was also expensive, slow, and delivered sub-par applications compared to what could be delivered with Unix, Client/Server, and Relational Databases.

    How did you fix things back in the day, especially if the problem involved more users, more data, more functionality? The answer was more disk, more memory, more CPU, and lots more money. (On a personal note, thank goodness for that!)

    I started my software career in this market in 1990 and with a better, faster, cheaper solution we had a lot of budget to work within and deliver ROI.

    But then those products started to mature, to become entrenched, and to stop innovating on future-thinking software in order to preserve past revenue streams.

    Rinse, wash, repeat.

    It’s twenty years later and how do you get Oracle, Teradata, Netezza, and IBM’s data to go faster? More disk, more memory, more CPU, and lots more money. Why else do you pay nearly 10 times revenues?

    If the definition of insanity is doing the same things over and over again and expecting different results, then continuously throwing hardware at what’s clearly a software problem is insane.

    Once again, it’s time for a new approach.

    I believe only a massively parallel, column-oriented database can properly handle the requirements of the modern database market. So when the team asked me today what I thought about IBM’s acquisition of Netezza, I said it was what’s to be expected, and there’s likely more to come.

    Now that Mark Hurd’s gone will we finally see HP ditch NeoView (or is that NoView?) and buy Teradata? With Kickfire going to Teradata, DATAllegro to Microsoft, Sun to Oracle to make their own appliance, and now IBM getting Netezza, that leaves the independent software vendors with the innovative software uniquely poised to deliver the real solutions.

    At least if we’re not confused about who the real competition is, unlike some who will remain named (ParAccel). Our competition is SAP’s Sybase IQ (hmm two acquisitions and a funeral?), Vertica, Infobright, and yes, ParAccel too. Then again, I remember ParAccell clearly talking about Oracle and Netezza and somehow forgetting Vertica. Perhaps they don’t really have a columnar database? they did start out as an appliance…

    Either way, it feels like 1990 all over again.

    Now, time to pull my double-breasted suit, Nirvana CD’s and my favourite Keds.

  17. Further thoughts on previous posts | DBMS 2 : DataBase Management System Services on September 29th, 2010 6:27 am

    [...] obvious reasons, IBM wasn’t in a position to talk a lot of IBM/Netezza detail when we happened to chat post-merger-announcement. But they did want to set me straight on [...]

  18. Appan on September 29th, 2010 11:42 pm

    Is there a benchmarks which shows how Vertica, ParAccel & Exasol performs on same dataset / same set of queries on same hardware like this one – http://www.vertica.com/benchmarks

    In the above link Vertica compares itself with only row-store DBMS.

  19. Curt Monash on September 29th, 2010 11:46 pm

    Not really. But if you look around this blog, you’ll see that I strongly favor running your own benchmarks anyway.

Leave a Reply




Feed: DBMS (database management system), DW (data warehousing), BI (business intelligence), and analytics technology Subscribe to the Monash Research feed via RSS or email:

Login

Search our blogs and white papers

Monash Research blogs

User consulting

Building a short list? Refining your strategic plan? We can help.

Vendor advisory

We tell vendors what's happening -- and, more important, what they should do about it.

Monash Research highlights

Learn about white papers, webcasts, and blog highlights, by RSS or email.