Oracle enhanced its business intelligence capabilities with the announcement of the Exalytics appliance at Oracle Open World in San Francisco this week. The product, currently in beta, is expected to be generally available by year's end.

Exalytics is a hardware-software combo that brings in-memory and visual discovery into Oracle's OBI EE 11g product line. It's the latest addition to Oracle’s expanding engineered systems that includes Exadata for transaction processing and data warehouse, and Exalogic for the middle tier application server. Previously, I’ve criticized Oracle for its lack of innovation and lackluster commitment to in-memory. Exalytics addresses both weaknesses.

Oracle acquired TimesTen, an in-memory database used predominantly for transaction processing, in 2005. It added support for TimesTen as a data source to OBI EE 11g in August 2010, but Oracle gave the impression that step was more of a checkoff to having BI in-memory, not a deeper integration.

In-memory isn't the only way to boost performance, Oracle argued. There’s Exadata, for example! It's true that for speed-of-thought analysis, there are multiple ways to achieve performance, and in-memory is just one approach. However, it’s an important one, more flexible than, say, indexes and cheaper than SSD. With SAP releasing its HANA in-memory appliance and with the rapid growth of vendors such as QlikTech and Tableau, Oracle has lagged in this area.

With the Exalytics appliance, TimesTen is enhanced for columnar compression and additional analytic functions such as WHEN, RANK, and it's tuned for analytic queries such as subqueries. There's a new adaptive in-memory cache and summary advisory to determine what should go in memory and what's better left on disk. An administrator can override the advisor’s selections.

Both the business meta data layer from OBI EE and the selected data sets are loaded into memory. Similar to HANA but in stark contrast to QlikTech, Exalytics can be queried with straight SQL. Another Exalytics differentiator is that Essbase is optimized for in-memory, allowing for better performance in planning and forecasting applications. On the hardware side, Exalytics has 1 TB of DRAM, running on four Intel Xeon E7-4800 processors.

Oracle says Exalytics has 20 times faster performance than current OBI EE implementations. And a beta customer cites 100 times better performance in some drill paths. One of Oracle's smartest moves is ensuring that Exalytics complements rather than competes with Exadata. Exalytics plugs into Exadata via two InfiniBand ports. This approach also addresses customers' concerns of what to do when all the data doesn’t fit into memory.

In addition to in-memory, the upcoming release includes visual discovery capabilities. Previously, Oracle OEM’d the Tableau visualization tool in an agreement established by Hyperion prior to Oracle's acquisition of that company. That agreement was discontinued earlier this year. Exalytics includes things like micro charts and trellis charts (also known as small multiples). There's a new “Presentation Suggestion Engine” that will recommend a visualization based on the data, no doubt an idea taken from Tableau’s “Show Me” feature. All of this is a vast improvement for customers and Oracle’s BI positioning.

However, based on an early demo of the controlled beta, I don’t think Oracle has a slam dunk here to beat more nimble competitors. Slow them, perhaps. Beat them, I’m not convinced.

The rise of visual discovery tools has as much to do with the visual appeal and rapid time to insight of the products as with their ease of deployment. Exalytics may solve some ease of deployment and performance tuning issues, but the enterprise architecture of OBI EE and its dependence on Fusion middleware components makes it less attractive to lines of business and SMBs.

In addition, competing products do some things better. For example, Tableau and Tibco Spotfire have powerful auto filters and data brushing that Exalytics doesn't appear to have. In QlikTech, the set analysis and faceted search are better. (For more details on how visual discovery vendors compare, see the recently updated "BI Scorecard Product And Vendor Summary")

Further, the new visualization capabilities appear to be tied to the Exalytics appliance. This can be a tough sell for customers who have already invested in OBI EE software and aren't otherwise planning hardware expenses. While I understand that the interactive, visual experience would be less powerful if the environment were slow, I’d like to see Oracle offer some of the software improvements as part of the standard OBI EE upgrade. MicroStrategy, by comparison, recently released Visual Insight as part of its Report Service license, a module most customers have already invested in.

Beyond these criticisms, the fact that Oracle is releasing a major appliance, with powerful visual and in-memory capabilities only a year after OBI EE 11g was released, shows that the vendor is serious about in-memory and capable of delivering BI innovation. I look forward to putting the new product to the test, and to hearing more about pricing and packaging.

Cindi Howson is the founder of BI Scorecard , an independent analyst firm that advises companies on BI tool strategies and offers in-depth business intelligence product reviews.

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