Oracle To Buy Advanced Visual Technology

The retail software maker's products help store owners decide how to arrange stores and manage retail space for best product placement.

Oracle (NSDQ: ORCL) on Wednesday agreed to acquire the British firm Advanced Visual Technology, a supplier of 3-D space-planning software for retailers.

The terms of the deal weren't disclosed. The transaction is expected to close by the end of the year.

Advanced Visual Technology can present a photo-realistic view of individual stores, then allow a retailer to work with suppliers and partners to design the floor space around the product lines available, Oracle said in announcing the acquisition. Retail is a vertical application market that Oracle has targeted since its acquisition of Retek in 2004 and, more recently, 360Commerce in January.

Oracle is competing with SAP in the retail applications space and is expected to continue to buy application suppliers in the retail space. Up-front applications, such as Advanced Visual Technology, help store owners decide how to arrange stores and manage retail space for best product placement. Such applications are expected to be integrated in the future with Oracle's back-end applications that analyze sales data and project where consumers are spending their money.

Advanced Visual Technology supplements Oracle's financials and back-end business intelligence with storefront "boots on the ground" retail know-how, said Stuart Williams, analyst with Technology Business Research.

Existing Oracle applications cover retail merchandising, inventory, point of service, returns handling, promotion optimization, and master data management.

Employees of AVT will join Oracle's Retail Global Business Unit.

Author: Charles Babcock @ www.informationweek.com

Read more ...

Oracle offers compression to DBAs

Oracle's powerful new HP Oracle Database Machine comes with 168TB of storage, a new method of retrieving data more quickly and intelligently, and - gulp- a hefty $2.33m (£1.26m) price tag.

It's the turbocharged option for the database administrator with money to burn and a need for speed.

But most DBAs don't get to drive in the fast lane - especially not with IT budgets the way they are. So as a less lavish option for enterprise users, Oracle is touting another approach. That one involves data compression, which has long been a popular way to save storage space and money. Traditionally, though, the trade-off has been high: Gobs of memory and processing power typically are needed to compress data and write it to disks. Even more is needed when the information is later extracted.

Now Oracle claims to have solved this thorny problem with a feature it first introduced in its Oracle 11g database, which was released last year.

By using the Advanced Compression option in 11g, Oracle says, DBAs can shrink database sizes by as much as three-quarters and boost read/write speeds by three to four times, no matter whether they're running a data warehouse or a transaction-processing database - all while incurring little in the way of processor utilisation penalties.

Oracle claims the storage and speed gains are so dramatic that companies using Advanced Compression will no longer need to move old, seldom or non-used data to archives. Instead, they can keep it all in the same production database, even as the amount of data stored there grows into the hundreds of terabytes or even the petabyte range.

"This works completely transparently to your applications," according to Juan Loaiza, Oracle's senior vice president of systems technologies. "It increases CPU usage by just 5 percent, while cutting your [database] table sizes by half."
Oracle says it's responding to the demands of enterprise customers with fast-growing databases. "The envelope is always being pushed," Loaiza said. "Unstructured data is growing very quickly. We expect someone to be running a one-petabyte, 1,000-CPU-core database by 2010."

It's also responding to the fact that storage technology, one of the keys to database performance, has made little progress from a speed standpoint, according to Loaiza. "Disks are getting bigger, but they're not getting a whole lot faster," he said.

Taking data compression down to the block level
Oracle has offered simple index-level compression since the 8i version of its database was introduced in 1999. That improved several years later with the introduction of table-level compression in Oracle 9i Release 2, which helped data warehousing users compress data for faster bulk loads, according to Sushil Kumar, senior director of product management for database manageability, high availability and performance at Oracle.

Advanced Compression provides even finer capabilities, letting the database compress data down to the disk-block level. The algorithm used in the new feature compresses data while keeping track of exactly where information is stored, Kumar said. The result, he claimed, is that when data is extracted by users, the database can focus in like a laser on the exact block on the disk where the information is located, instead of pulling whole tables and sifting through unwanted data.

Other compression schemes "have no idea what's on the disk," Kumar contended. "They can't read part of a document without opening up the entire one."

According to Oracle officials, Advanced Compression is also smart enough not to compress data with every single change to a database, but to instead let the changes accumulate and then run them in batches. That is efficient enough to enable Advanced Compression to work with OLTP databases, which tend to have heavy read/write volumes, said Vineet Marwah, a principal member of the Oracle database staff.

Another component of Advanced Compression, called SecureFiles, can automatically detect, index and compress non-relational data such as Word documents, PDFs or XML files, Marwah said. Oracle also has enhanced its backup compression performance so that it is 40 percent faster in 11g than in the previous version of the database, while not degrading the performance of other database functions, he said.

And because a compressed database is generally much smaller, it shrinks the flow of data between the storage server and database, where bottlenecks tend to occur, Kumar says. The gains are so dramatic that DBAs can dump their complicated partitioning and archiving schemes, he claimed. "A lot of people archive data because they have to, not because they want to," he says. "So if you see a business value in keeping data around, compression is a useful way to not let resource constraints dictate your architecture."

Oracle acknowledges that Advanced Compression isn't a cure-all. For instance, while large table scans "are a whole lot faster, compression doesn't make random-access reads that much faster," Loaiza says. Also, data that has already been compressed, such as a JPEG image, can't be compressed further, according to Kumar.

Oracle's claim of 4:1 compression also isn't the highest level in the database industry. Database analyst Curt Monash pointed out in an online post this week that analytic database start-up Vertica claims compression ratios from 5:1 to as much as 60:1, depending on the type of data.

Kumar declined to comment about Vertica. But during his OpenWorld presentation, he claimed that Oracle's variable-length, block-level compression is more efficient than what is offered in IBM's rival DB2 9 database, not to mention faster. "Because DB2 is so inefficient to begin with, Oracle is the winner any day," Kumar said. He also called the compression offered by data warehousing database vendor Teradata Corp. "very primitive."

But users haven't flocked to Advanced Compression yet. One reason is that it's a paid add-on. A licence costs $11,500 per processor, with updates and support adding an additional $2,530 per CPU. Also, it's available only to users of 11g Enterprise Edition, and Oracle hasn't seen much adoption of 11g thus far. According to Andrew Mendelsohn, Oracle's senior vice president of server technologies, 75 percent of its customers are running 10g, and another 20 percent are still running 9i.

Take what is likely Oracle's biggest customer, LGR Telecommunications, which develops data warehousing systems for telecommunications companies. LGR has built two 300TB data warehouses for AT&T for use in storing and managing the carrier's caller data records, according to Paul Hartley, general manager of LGR's North American operations in Atlanta. The databases, which run concurrently with one another, can scale up to a total of 1.2PB, says Hartley.

But the two data warehouses are based on Oracle 10g, so they can't take advantage of Advanced Compression. LGR does "use compression to some extent today, but we plan to use it extensively in the future," says Hannes van Rooven, a manager at LGR.

Another Oracle customer, Intermap Technologies, is using the spatial-data version of 11g for its 11TB database of digital mapping and imagery data, which is expected to grow to 40TB by the first quarter of 2010, according to Sue Merrigan, senior director of information management at the company. Intermap isn't in the compression camp now. "We don't compress the data because we are concerned it would lose its accuracy," Merrigan says.

That isn't true, responds Kumar, who said that Advanced Compression is a so-called lossless compression scheme.

Rivals such as John Bantleman, CEO of archiving software vendor Clearpace Software, argue that sending old data to archives will continue to boost database performance more than compressing information. Moreover, it isn't much more complicated to do so, Bantleman claims. And using tools such as Clearpace, users can search and extract data archived outside of the database as quickly and conveniently as if the information was stored in it, according to Bantleman.

"A telco might need to maintain its caller data records for years," Bantleman says. "But does it really make sense to keep all of that in your database if regulations only require you to keep access to it for 90 days?" He added that it might seem better "emotionally" to maintain a single data storage environment. "But I think you want to segment the live part of your data for OLTP performance from your highly compressed historical data. These two schemas don't meld well in the same box."

Author: Eric Lai @ www.techworld.com

Read more ...

Oracle Flies High Above Wall Street's Carnage

With little exposure to the financial crisis, the software giant faces threats from SAP and the U.S. dollar. An economic slowdown could hurt.

Turmoil in American banking and recent gains by the U.S. dollar have left investors jittery over the potential impact on tech companies such as Oracle (ORCL). The world's second-largest software company allayed some of those concerns Sept. 18, when it reported fiscal first-quarter results in line with analysts' estimates and assured investors that its exposure to the problems of Wall Street financial firms is minimal.

Oracle said first-quarter profit rose 28% to $1.1 billion, or 21¢ a share, vs. 16¢ per share a year ago. Excluding expenses for stock options and acquisitions, profit in the period that ended Aug. 31 was 29¢ a share, beating analysts' expectation for 27¢. Revenue rose 18% to $5.3 billion. Including revenue from acquisitions not counted in its GAAP revenues, sales for the quarter were $5.4 billion, matching analysts' estimates. "Oracle is a great sales organization and very cost-conscious, and that's showing through," says Andy Miedler, a senior technology analyst at Edward Jones Trust, who rates Oracle a buy.

Evidence that Oracle is weathering the economic slowdown came as a relief to money managers, who regard its results as a barometer of the industry's health. "Investors are in a frenzy trying to gauge the exposure of Oracle and other technology companies to a slowdown in financial-services spending," says Mark Murphy, a research analyst at Piper Jaffray (PJC), who has a neutral rating on Oracle's stock. "There really is no firm consensus on that."

Little Dependence on Banks

Within the past week, Merrill Lynch (MER) has been acquired by Bank of America (BAC), Lehman Brothers (LEH) has begun liquidating its assets, and the Federal Reserve bailed out insurer American International Group (AIG). More consolidation among financial-services firms is likely. Those events, and the shocks they have sent through markets, have tech investors trying to calculate the effects on information technology spending. Piper Jaffray estimates financial-services firms account for about 20% of U.S. IT spending.

Oracle Co-President Safra Catz said the percentage of Oracle's sales to U.S. banks was in the "low single digits." Also reassuring to investors was news that sales of new software licenses, a yardstick of future revenue, increased 14%, to $1.2 billion, within the conservative range (BusinessWeek.com, 6/26/08) Oracle had told analysts to expect. Shares of Oracle rallied more than 6% in extended trading on Sept. 18 after having risen 65¢, or 3.6%, before the earnings report was released. Still, the stock is down 16% since reaching an at-least-52-week high in August.

Oracle has been on a tear for the past year, posting increases in sales of its database software and business applications, used by companies to manage payrolls, inventory levels, and billing. Today's news aside, some analysts question whether Oracle will remain immune to the economic slowdown and the forces roiling the financial-services sector. Dell (DELL) on Sept. 16 warned of weakening demand, just weeks after reporting a disappointing quarter. And Goldman Sachs (GS) on Sept. 8 cut its IT spending forecast for the year to 4% growth, from 6%.

Rising Dollar Cuts Revenues

Oracle's sales of new applications licenses fell 12%, to $331 million, during the quarter. Oracle is fighting a pitched battle for applications market share with German rival SAP (SAP), which held 22.4% of the $62.8 billion market in 2007, compared with 12.5% for Oracle, according to tech industry consultant AMR Research.

A stronger dollar is also taking a bite out of revenue. During a Sept. 18 conference call discussing the results, Catz said overall new license sales will rise just 5% to 15% during the second quarter, which ends in November, and that the dollar's appreciation since July will lop another 3% off those estimates. The company expects overall revenue to grow 9% to 12%, including currency effects. Excluding the effects of currency, Oracle's sales may be $6.03 billion, at the midpoint of the company's guidance, compared with analysts' expectation of $6.23 billion. Oracle expects to earn 35¢ or 36¢ a share, compared with analysts' estimates of 35¢.

After more than two years of declines, the dollar has rallied against the euro (BusinessWeek.com, 9/16/08), hitting an all-time low of $1.604 per euro on July 15. That means overseas sales by tech companies amount to less revenue when translated back into dollars. Conversely, SAP will likely benefit from the trend.
Maintenance Fees Add Up

So far, though, Oracle's acquisition machine and flagship database business have continued to fuel sales and profit growth. Oracle has purchased more than 40 software companies for more than $25 billion since the beginning of 2005. New license sales of databases and middleware, which connect other pieces of software, grew 27% during the first quarter, to $906 million, helped in part by Oracle's $8.5 billion acquisition of BEA Systems in January. At Oracle's annual customer conference that begins Sept. 21 in San Francisco, the company plans to announce a new database-related product, Co-President Charles Phillips Jr. said during the conference call.

And Oracle is expanding its profit margins by adding to its revenue stream more of the lucrative "maintenance" fees customers pay for software updates and technical support. The fees now account for nearly 56% of Oracle's sales and yield higher margins than other parts of Oracle's business. "That's a reshaping of our business—the highest-margin portion of our business is now the largest portion of our business," Oracle Chief Executive Larry Ellison said during the call.

Edward Jones analyst Miedler says Oracle has proved deft at integrating the companies it's bought. "They can acquire a company and plug it into the Oracle machinery with few hiccups," he says. "And they can squeeze more profit out of these targets." Amid the Wall Street meltdown, economic malaise, and currency drag, Oracle will need to keep that machine as well-oiled as ever.

Author: Aaron Ricadela @ www.businessweek.com

Read more ...