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Q&A with Bill Inmon on Some Straight Talk About The Costs Of Data Warehousing


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This is Tamara Graves of Dataupia and it is my pleasure to spend a few minutes talking with Bill Inmon about his research on the costs of data warehousing.

Can you tell us:

Q. Why data warehousing costs are becoming critical to businesses?
A. There are lots of reasons for it but the main reason is that the volumes of data that people are collecting are beyond anything they had ever imagined. What has happened is that as the volumes of data have increased, the infrastructure that is required to support that increase also increases. You need storage but you also need controllers, computers, processors, software, etc. and what is happening each day, each week as data increases in the corporation the infrastructure costs creeps up as well. That is happening universally.
Q. What would you say is the one cost component that most companies forget when they are doing their budget planning?
A. Quite frankly it is the cost of the storage and the processors that are needed to support that storage. What happens is that cost of the storage goes up as the data volumes increase. Let me explain what I mean by that. You can go down to Radio Shack and buy 1 TB of data. I am not sure of the cost, you can maybe buy it for $200 – $300... maybe even $1,000 or less and you can take that home and put it into your PC and you have bought a lot of storage. The problem is that when you are large corporation and you want to support that data on a real-time database managed basis, the cost of storage goes up. The more TBs of data you want to store, the more expensive those TBs become. So, if on a high performance, MMP processor for example from an organization like Teradata you might pay anywhere from $700,000 - $1 million/TB which is far more expensive then what you would get at Radio Shack. What is interesting is that as those volumes of data increase, they also increase the unit cost of the storage itself. That is why when I see people with large, mature data warehouse and I see what happens to their budget they are in for a rude shock if they that the cost of processing is going down as some hardware vendors would have you believe.

Thank you so much for sharing just a few of your insights on the costs of data warehousing. In order to get all of the details, please be sure to download the whitepaper in its entirety here.