Netezza Finds Its Way with Spatial Data

9/16/08Follow @wroush

Marlborough, MA-based Netezza (NYSE: NZ) will today unveil a feature for which users of its data warehouse appliances have long been clamoring: location.

The firm raised more than $100 million in a July 2007 IPO, based largely on the perceived strength of its appliances, which are designed to speed up the complex queries that business managers often need to run against their historical business data. Traditional data warehouses are sundry contraptions, consisting of storage hardware from the likes of EMC or Hitachi, servers from IBM, Sun, HP, or Teradata, and database software from Oracle, IBM, or Microsoft. But Netezza combines all of these elements into one box. And using a combination of technical tricks—such as running queries in parallel against hundreds of segments of a database, and filtering and pre-analyzing data using processors placed directly on storage disks rather than moving it all to main memory first—its devices can complete many types of business-intelligence (BI) queries 10 to 100 times as fast as competitors’ systems.

But until this week, there was one type of data that Netezza’s appliances couldn’t handle at all: spatial information such as latitudes and longitudes. That was a key shortcoming, since more and more business decisions have a location-based component. Cellular providers, for example, need to know where customers have the most trouble with dropped calls before they can decide where to build new cell towers. But for the most part, solving the geospatial parts of such riddles has fallen to specialized geographic information systems (GIS), which evolved separately from most other business software and are set apart by very different ways of storing data—using formats that Netezza’s database couldn’t even read.

So Netezza was, in effect, ceding the spatial information management business—which is expected to generate $5.1 billion in IT revenues per year by 2012, according to research firm IDC—to Oracle, IBM, Microsoft, and other competitors whose database programs offer support for geospatial data types. But at a user conference in Orlando, FL, today, Netezza will announce a software extension that allows its data warehouse appliances not only to handle location-based information, but to do it at the same accelerated rate that they can execute standard business queries.

It’s a feature that Netezza customers have been requesting for years, according to Jonathan Shepherd, the company’s general manager of location based solutions. “What we saw was that in insurance, financial services, telecommunications, retail, online, advertising, and government, customers were primarily using Oracle, which has the largest share of the spatial data market. And they were saying ‘If you could do in our spatial data warehouse what you’ve done in our BI warehouse, we’d be thrilled.’ So we saw an opportunity to merge the two.”

But following through on that opportunity required some help from another local startup, Boston-based Intelligent Integration Systems, Inc., or IISi. A year ago, says Shepherd, Netezza launched a program giving outside software developers the technical details they needed to write applications that would run inside the massively parallel architecture of Netezza’s appliances. IISi was one of the companies that took up this challenge, creating a geospatial toolkit that allowed Netezza’s built-in database to handle data encoded using specifications from the Open Geospatial Consortium, the leading standards body in the GIS field. “We saw IISi’s effort as being applicable across our customer base, so we acquired the technology from them,” says Shepherd.

That’s what the company is unveiling today, under the name Netezza Spatial. It’s also working with other vendors, such as PitneyBowes’ MapInfo location intelligence division and spatial data conversion specialist Safe Software, to make sure that the new technology works with existing BI and GIS software.

Already, at least one Netezza customer is using the spatial extension: New York-based Guy Carpenter, which helps insurance companies balance risks and obtain reinsurance. The company must frequently answer questions such as how many of a client’s subscribers live within a given floodplain or earthquake zone or are likely to suffer storm damage in an approaching hurricane. “Providing real-time, predictive data to our insurance customers is critical when it comes to natural disasters,” Shajy Mathai, a Guy Carpenter managing director, said in a statement. “The combined solution of Netezza, MapInfo and Safe Software provides us the critical tool we need to ensure our customers are getting the most up-to-date information.”

Shepherd couldn’t say exactly how much faster Guy Carpenter can run geospatial queries now that it’s using Netezza’s appliances. “What we’re comfortable saying is that we’re seeing the same order-of-magnitude improvement—meaning 10 to 100 times faster than our customers’ legacy systems,” he says. “We’ll have more case studies as we announce more customers. But the issue Netezza is seeing is that our 200-plus [existing] customers want to capture this data, but it has not been easy to query and derive meaningful analytics. That was really the motivation for us to acquire this technology and make it available.”

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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