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Amazon’s new data warehousing service takes aim at “old guard” IT giants

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Updated: Well, now we know what one of Amazon’s “unbelievable” new services will be. It’s Redshift, a data warehousing service now in preview, which aims to siphon business from Oracle(s orcl) (Redshift, get it?), IBM(s ibm) and Teradata(s tdc). The move shows that Amazon Web Services (AWS) hasn’t finished building higher-level services that compete not only with old-school IT vendors but with some of Amazon’s own software partners.

Redshift will cost roughly 1/10th of what old-school data warehouses would, Andy Jassy, SVP of Amazon Web Services (AWS) said Wednesday morning in his AWS:Reinvent keynote.

Data warehouses are too expensive and too hard to scale for big companies and just plain too expensive for small businesses, Jassy said. For that reason, AWS wanted to build a service that is easy to get started on, would be self service and can scale up and down as needed.

The company tested out Redshift on’s giant retail business and found that it worked out to about $32,000 a year versus “millions” spent on its old-school data warehouse. Traditional data warehouse applications can cost $19,000 to $25,000 per GB per year compared to $1,000 per GB TB per year for Redshift. Update: Redshift builds on technology licensed from Paraccel.

Of course the proof is in the pudding. Customers can sign up for the preview now.

Amazon execs are hell bent on showing that their services are ready for primetime even for mission-critical applications. But last week,  two IT execs, one from Diebold and another from a big US bank, both told me that no one in their companies, not even developers, can use AWS at all for compliance reasons So there’s still some work to do there.

13 Responses to “Amazon’s new data warehousing service takes aim at “old guard” IT giants”

  1. George Kong

    I am confused. The picture shows 1.6 PB costing several million dollars. 16 TB costs 32K on Amazon. If you scale that up to 1.6 PB, that’s 3.2 million. Isn’t that the same thing?

  2. mikelamble

    Amazon’s Redshift announcement validates that enterprises are ready for cloud-based big data warehousing solutions. XtremeData, also available on Amazon as well as other clouds, is targeted for organizations that need a massively scalable DBMS solution for mixed read and write workloads, for example, with serious ELT. Redshift (a column-store licensed from ParAccel) is well-suited for read-only data marts of all sizes. The market is rapidly moving to a tipping point where the specialized solutions available on premise are becoming available on the cloud, Amazon and others.

  3. DW Consultant

    AMZN seems to be on the right track. From listening to the webinar, it sounds that there are lots of differences between ParAccel and Vertica. ParAccel has more enterprise features as compared to VT and has lot more enterprise customers in investment banking and retail. VT needs projections for performance which means not great for adhoc analysis. It will be interesting to see how it plays out, VT is well suited for operational reporting needs while ParAccel will be more analytical workload. At the end, customers can now choose right tool for the job!!!

  4. Brian Reeves

    Linkedin or it’s news writers seem to be in love with Amazon Web Services. Every day AWS is receiving FREE advertisements in the news feed. AWS is trying to penetrate the Enterprise market but Verizon/Terremark is already built for Enterprise. Why wait for AWS to get it right. VT has been built to handle Enterprise level applications without the normal concern of security.

  5. Barb, there is interesting data in the picture you included. The legacy system was 16 times the number of nodes and yet the Redshift service provided 10X performance which means there will be added savings because more queries can be run in the same amount of time. Any one running ParAccel on premise would experience even greater cost/performance benefits, particularly higher performance needed for advanced analytic workloads!