Oracle has launched a high-end database and storage system that it co-developed with Sun Microsystems, the companies' first joint product since announcing their plans to merge almost five months ago.

Called the Exadata Database Machine Version 2, it combines Intel-based servers and other Sun hardware with Oracle's database and storage management software in a rack-based system optimized for enterprise data warehousing and high-speed online transaction processing (OLTP).

Oracle CEO Larry Ellison unveiled the product on a webcast Tuesday from Oracle's California headquarters, where he was joined by John Fowler, executive vice president in charge of Sun's systems business. The system uses an unusually large amount of flash memory -- up to 5TB in a fully loaded rack -- to achieve high levels of OLTP performance, Ellison said.

Neither of the executives made any reference to the companies' pending merger, which Oracle had hoped to close by now but which has been held up by competition regulators in Europe. Nor did they disclose any more information about which Sun products Oracle will support or discontinue if the merger goes through.

The system that launched Tuesday uses Linux, rather than Sun Solaris, and Intel-type processors, rather than Sun's Ultrasparc T2 chips, as some had expected. But Oracle has pledged to support Sun's Sparc platform in the future.

The Exadata system is a follow-on to a similar product that Oracle developed last year with Hewlett-Packard. Both systems combine database servers, storage servers and networking in a rack-based system preconfigured with Oracle's software.

The first Exadata system was for data warehousing only, Ellison said, while Exadata 2 is for both data warehousing and online transaction processing. "Exadata Version 1 was the world’s fastest machine for data warehousing applications,” he said. “Exadata Version 2 is twice as fast as Exadata Version 1 for data warehousing, and it’s the only database machine that runs OLTP applications."

The first version was based on HP's Intel-based ProLiant G5 servers, while the new machine uses Sun Fire X4275 servers with Intel's quad-core Nehalem processors. It also uses a faster memory type, DDR3, and faster disk and InfiniBand components, Ellison said, explaining the performance boost over the first Exadata.

But the main advance is a new flash-based memory system from Sun that is used in the storage servers. Called FlashFire, it packs four flash accelerator cards into each storage server, each with a capacity of 96GB. A fully loaded rack with eight storage servers has 5TB of flash memory, as well as 100TB of SAS disk capacity or 336TB of SATA disk capacity, Ellison said.

"We have a huge, fast flash cache built into our storage servers," Ellison said. "These are not flash disks -- make no mistake, these are not flash disks. This is a smart memory hierarchy made up of DRAM in our database servers and flash in our storage servers, with very sophisticated algorithms. This is a very smart memory hierarchy where the Oracle software manages that memory extremely efficiently, much faster than flash disk."

The use of flash memory and InfiniBand allows the system to perform 1 million I/O operations per second, according to Ellison. "We can move data much more rapidly than any other computer in the world," he claimed.

All that speed comes at a price. A full rack configuration, with eight database servers and 14 storage servers, starts at US$1.15 million for the database hardware alone, according to a price list. The Oracle database software and Exadata Storage Software are extra, as are the storage hardware and installation fees.

The system is also offered in half-rack, quarter-rack and single-server configurations, however. The entry product starts at $115,000 for the database server hardware.

"I think it's incredible the amount of flash they're using," said Dan Olds, principal analyst with Gabriel Consulting Group. "It's not quite an in-memory database, but it's not far off it. Couple that with the Nehalem processors and the InfiniBand, and that's where the OLTP performance is coming from."

Terms of use are "quite restrictive, though," he noted, pointing to an Oracle FAQ. Exadata customers have to use the latest Enterprise Edition of Oracle Database, version 11.2 or higher, and the system can't be modified in any way.

Customers also can't run any other software on the machines, he noted. "They didn't really talk about whether you can do OLTP and data warehousing at the same time," Olds said. "As these machines get bigger and bigger, there are fewer and fewer customers that can use them for just one workload."

In some ways the event was notable for what Ellison did not say. With Sun customers facing uncertainty about the future of their platforms, rivals HP and IBM have been courting Sun customers away with aggressive migration programs. Oracle has been trying to contain the damage with newspaper ads saying it will invest more in Sun's Sparc than Sun does.

But Ellison said nothing about his plans for Sun on Tuesday. He and Fowler both stressed that the Exadata 2 was developed under the companies' long-standing partnership. The webcast ended abruptly with no time for questions.

Oracle has won approval for its Sun acquisition from U.S. regulators, but the European Commission has held up the deal, possibly until January. The Commission says it's concerned that Oracle's ownership of Sun's MySQL database could harm competition in the open-source software market.

While most analysts expect the deal to go through, the uncertainty has been hammering Sun's server business. Its server revenue plunged 37 percent in the second quarter, a much greater decline than for any of its main rivals, according to IDC.