Databricks is playing the long game in its battle against Snowflake

The data analytics market is Snowflake's to win right now, but Databricks CEO Ali Ghodsi doesn't expect its advantage to last.

​Databricks CEO Ali Ghodsi speaks during a 2019 Bloomberg Television interview.

Databricks CEO Ali Ghodsi is intent on moving into Snowflake's turf.

Photo: David Paul Morris/Bloomberg via Getty Images

Databricks CEO Ali Ghodsi is playing the long game to unseat Snowflake as the darling of the data world.

Snowflake made a name for itself helping companies use stored information to drive deeper analytics. Tackling that market, which could be worth $35 billion by 2025, helped propel the company to a historic IPO in September. But its stock has drifted downward since.

Databricks, which is plotting its own public offering, is wading deeper into Snowflake's territory with a new product that lets customers query data for more basic statistical analyses using SQL, a programming language that Snowflake also relies on.

Meanwhile, Snowflake is laying the groundwork to let its users tap the same analytical data to power artificial intelligence-backed algorithms.

That means the two, which until now were able to largely play nice together in the enterprise-data sandbox, may soon find themselves flinging their toys at each other. But while Ghodsi acknowledged that Snowflake has the advantage right now, he argued that will soon change.

"Operational AI is going to be a much bigger market," Ghodsi told Protocol. "It's not a bigger market right now than data warehousing, but over the next 10 years it will be."

In Ghodsi's view, it's much easier to take a system that can support advanced analytics and infuse the ability to do basic statistical work than trying to tackle it from the opposite direction, which he argued is Snowflake's struggle right now.

Snowflake does offer users several features, like data pipelining, which are important foundations for advanced algorithms. It also recently added support for Java and Python, two of the most popular AI programming languages, in an attempt to bring more data scientists on board. Currently, however, Snowflake's tools are more suited for data analysts — and will likely remain that way for a while.

Snowflake readily admits it isn't trying to replicate Databricks's model. Instead, the company is relying on integrations with AI platforms from Google, Microsoft and AWS, according to SVP Christian Kleinerman.

"Do you have algorithms that are natively hosted by us? No. But it's not because we can't or because we don't know how to. It's because we know the space is very fluid," he told Protocol. "Our entire initiative in AI and ML has been to build extensibility into Snowflake so you can interface with your tool of choice."

Snowflake was able to capitalize on the rush among enterprises to empower more of their employees to access data and conduct more advanced statistical analyses. But building AI models is much more difficult, as it involves training algorithms to begin to draw future predictions or discover unknown correlations from those vast data sets. Regeneron, for example, used Databricks to find a genome for chronic liver disease.

And there's clearly a lot of enthusiasm for Ghodsi's vision. Databricks has raised $1.8 billion — $1 billion of that in February — and is valued at an astonishing $28 billion. (Ghodsi even believes Databricks is undervalued at this point.) The company is also backed by Salesforce, AWS, Microsoft and CapitalG, a venture fund under the Alphabet umbrella alongside Google. Some of those giants have their own AI engines — AWS has SageMaker and Microsoft has Azure ML, for example — so backing Databricks is a good proof point of just how powerful its platform is. It's also an indicator that, while the major cloud providers partner with Snowflake, they may see longer-term value in a deeper relationship with Databricks.

Still, with a market cap of $57 billion, Snowflake is a much larger company. While Databricks's value is likely to skyrocket when it IPOs, Snowflake definitely has the first-mover advantage. And given the time it will take to establish operational AI as a full-fledged market, the company has some runway. There's also a plethora of AI startups Snowflake can pick from and, with its equity and a war chest of $4 billion, it's not short on stock or cash it can use to acquire tech to help support the pivot. The company, for example, recently invested an undisclosed sum in Dataiku and has an equity stake in DataRobot.

The market is ultimately going to be large enough to support both. But most software vendors are never content with second place, which means the fights between Snowflake and Databricks are likely just beginning.


A pro-China disinformation campaign is targeting rare earth miners

It’s uncommon for cyber criminals to target private industry. But a new operation has cast doubt on miners looking to gain a foothold in the West in an apparent attempt to protect China’s upper hand in a market that has become increasingly vital.

It is very uncommon for coordinated disinformation operations to target private industry, rather than governments or civil society, a cybersecurity expert says.

Photo: Goh Seng Chong/Bloomberg via Getty Images

Just when we thought the renewable energy supply chains couldn’t get more fraught, a sophisticated disinformation campaign has taken to social media to further complicate things.

Known as Dragonbridge, the campaign has existed for at least three years, but in the last few months it has shifted its focus to target several mining companies “with negative messaging in response to potential or planned rare earths production activities.” It was initially uncovered by cybersecurity firm Mandiant and peddles narratives in the Chinese interest via its network of thousands of fake social media accounts.

Keep Reading Show less
Lisa Martine Jenkins

Lisa Martine Jenkins is a senior reporter at Protocol covering climate. Lisa previously wrote for Morning Consult, Chemical Watch and the Associated Press. Lisa is currently based in Brooklyn, and is originally from the Bay Area. Find her on Twitter ( @l_m_j_) or reach out via email (ljenkins@protocol.com).

Some of the most astounding tech-enabled advances of the next decade, from cutting-edge medical research to urban traffic control and factory floor optimization, will be enabled by a device often smaller than a thumbnail: the memory chip.

While vast amounts of data are created, stored and processed every moment — by some estimates, 2.5 quintillion bytes daily — the insights in that code are unlocked by the memory chips that hold it and transfer it. “Memory will propel the next 10 years into the most transformative years in human history,” said Sanjay Mehrotra, president and CEO of Micron Technology.

Keep Reading Show less
James Daly
James Daly has a deep knowledge of creating brand voice identity, including understanding various audiences and targeting messaging accordingly. He enjoys commissioning, editing, writing, and business development, particularly in launching new ventures and building passionate audiences. Daly has led teams large and small to multiple awards and quantifiable success through a strategy built on teamwork, passion, fact-checking, intelligence, analytics, and audience growth while meeting budget goals and production deadlines in fast-paced environments. Daly is the Editorial Director of 2030 Media and a contributor at Wired.

Ripple’s CEO threatens to leave the US if it loses SEC case

CEO Brad Garlinghouse said a few countries have reached out to Ripple about relocating.

"There's no doubt that if the SEC doesn't win their case against us that that is good for crypto in the United States,” Brad Garlinghouse told Protocol.

Photo: Stephen McCarthy/Sportsfile for Collision via Getty Images

Ripple CEO Brad Garlinghouse said the crypto company will move to another country if it loses in its legal battle with the SEC.

Garlinghouse said he’s confident that Ripple will prevail against the federal regulator, which accused the company of failing to register roughly $1.4 billion in XRP tokens as securities.

Keep Reading Show less
Benjamin Pimentel

Benjamin Pimentel ( @benpimentel) covers crypto and fintech from San Francisco. He has reported on many of the biggest tech stories over the past 20 years for the San Francisco Chronicle, Dow Jones MarketWatch and Business Insider, from the dot-com crash, the rise of cloud computing, social networking and AI to the impact of the Great Recession and the COVID crisis on Silicon Valley and beyond. He can be reached at bpimentel@protocol.com or via Google Voice at (925) 307-9342.


The Supreme Court’s EPA ruling is bad news for tech regulation, too

The justices just gave themselves a lot of discretion to smack down agency rules.

The ruling could also endanger work on competition issues by the FTC and net neutrality by the FCC.

Photo: Geoff Livingston/Getty Images

The Supreme Court’s decision last week gutting the Environmental Protection Agency’s ability to regulate greenhouse gas emissions didn’t just signal the conservative justices’ dislike of the Clean Air Act at a moment of climate crisis. It also served as a warning for anyone that would like to see more regulation of Big Tech.

At the heart of Chief Justice John Roberts’ decision in West Virginia v. EPA was a codification of the “major questions doctrine,” which, he wrote, requires “clear congressional authorization” when agencies want to regulate on areas of great “economic and political significance.”

Keep Reading Show less
Ben Brody

Ben Brody (@ BenBrodyDC) is a senior reporter at Protocol focusing on how Congress, courts and agencies affect the online world we live in. He formerly covered tech policy and lobbying (including antitrust, Section 230 and privacy) at Bloomberg News, where he previously reported on the influence industry, government ethics and the 2016 presidential election. Before that, Ben covered business news at CNNMoney and AdAge, and all manner of stories in and around New York. He still loves appearing on the New York news radio he grew up with.


Microsoft and Google are still using emotion AI, but with limits

Microsoft said accessibility goals overrode problems with emotion recognition and Google offers off-the-shelf emotion recognition technology amid growing concern over the controversial AI.

Emotion recognition is a well-established field of computer vision research; however, AI-based technologies used in an attempt to assess people’s emotional states have moved beyond the research phase.

Photo: Microsoft

Microsoft said last month it would no longer provide general use of an AI-based cloud software feature used to infer people’s emotions. However, despite its own admission that emotion recognition technology creates “risks,” it turns out the company will retain its emotion recognition capability in an app used by people with vision loss.

In fact, amid growing concerns over development and use of controversial emotion recognition in everyday software, both Microsoft and Google continue to incorporate the AI-based features in their products.

“The Seeing AI person channel enables you to recognize people and to get a description of them, including an estimate of their age and also their emotion,” said Saqib Shaikh, a software engineering manager and project lead for Seeing AI at Microsoft who helped build the app, in a tutorial about the product in a 2017 Microsoft video.

Keep Reading Show less
Kate Kaye

Kate Kaye is an award-winning multimedia reporter digging deep and telling print, digital and audio stories. She covers AI and data for Protocol. Her reporting on AI and tech ethics issues has been published in OneZero, Fast Company, MIT Technology Review, CityLab, Ad Age and Digiday and heard on NPR. Kate is the creator of RedTailMedia.org and is the author of "Campaign '08: A Turning Point for Digital Media," a book about how the 2008 presidential campaigns used digital media and data.

Latest Stories