Oracle, which has been slow to transform itself for the coming cloud era, took an important step on Monday at Oracle Openworld 2011 by announcing the Oracle Big Data Appliance, which is built on NoSQL and Hadoop — key technologies for the future of the cloud and "big data."
Oracle's flagship database is built on a solid old technology called the relational database, but newer web sites and web apps have moved beyond the relational database in order to scale to a global level at much faster speeds. Sites like Twitter, Facebook, and Netflix are examples of the kinds of sites that have had to use NoSQL in order to meet the demands of the rapidly-expanding global web, especially for sites/apps that are more interactive and not just about loading pages.
For Oracle's purposes, it wants to have a NoSQL and Hadoop product to allow businesses to grab unstructured data from across the web and then use it to build powerful new reports. Oracle will also provide a bridge to its other products so that this unstructured data can be combined with structured data in a traditional Oracle database to provide businesses with the ability to do reports and real-time business analytics that are based on streams of both structured data and unstructured data.
So what does that look like in the real world? Interestingly enough, in an earlier keynote from Oracle partner EMC, who is working on a similar product (albeit from a software perspective), provided a perfect example. In this case, it was an auto insurance company that is using big data to set better rates for its customers. Analyzing big data has showed that the vast majority of customers are safe and they are subsidizing the cost of a small sample of really bad drivers. So, this insurance company could use this big data do two things to change the rates of its customers and save the majority of its customers more money (and, conversely, make bad drivers pay more of their own way).
The big data software for this insurance company could set the standard rate for the customer and then provide a discount (or penalty) based on more thorough data analysis. The first analysis would be based on structured data (driving record, legal record, credit score, etc.). The second analysis could be based on an unstructured source of data such as the person's social graph (Twitter stream, YouTube views, etc.). People that do a lot of parental stuff on their social graph would likely get a discount, while those whose social graph is full of thrill-seeking activity would likely get a penalty.
Your social graph having a financial impact on you personally may sound a little scary — and let's be clear that this example is only conceptual at this point — but everyone should be aware that this is the kind of thing that companies are going to be able to do in the future. This shows how businesses will soon be able mine public data with products like the Oracle Big Data Appliance. You can already do much of this now by hacking something together with NoSQL and Hadoop, but Oracle is ready to commercialize it in a big way.
Here's how Andrew Mendelsohn, senior vice president of Oracle Server Technologies, put the announcement in context for Oracle:
"With the explosion of data in the past decade, including more machine-generated data and social data, companies are faced with the challenge of acquiring, organizing and analyzing this data to make better business decisions. New technologies, such as Hadoop, offer some relief, but don't provide a holistic solution for customers' Big Data needs. With today's announcement, Oracle becomes the first vendor to offer customers a complete and integrated set of products to address critical Big Data requirements, unlock efficiencies, simplify management and create data insights that maximize business value."
Jason Hiner is Editor in Chief of TechRepublic and Long Form Editor of ZDNet. He writes about the people, products, and ideas changing how we live and work in the 21st century. He's co-author of the book, Follow the Geeks.