Oracle has said it will buy Tangosol and use its in-memory data grid software to speed up data access as part of the Oracle Fusion middleware.

Data grid software is middleware that manages data objects in-memory across multiple servers. It's used to raise application performance by enabling fast access to frequently used data, removing the need to access it from slower moving back-end systems.

"This brings a new piece of the puzzle to us," said Steve Harris, vice president of development for Oracle. "It's a new part of the technology stack that will enhance our ability to address this extreme transaction processing in middleware."

Tangosol's Coherence software helps enable what's known as extreme transaction processing (XTP), common in industries where real-time access to data is crucial such as financial services, telecommunications and logistics. The bulk of Tangosol's revenue comes from financial-services companies, said Cameron Purdy, CEO of Tangosol.

As more companies move toward service-oriented and event-driven architectures, the demand for this functionality grows, Harris said.

Awareness of technology like Tangosol's has grown significantly over the last couple of years, Purdy said. Around 18 months ago, his company generally stopped having to explain to potential customers what the technology could do for them, he said.

For example, a banking customer of Tangosol's was able to reduce the time it takes to complete a specific task from 50 days to one hour, Purdy said.

Subject to customary closing conditions, Oracle expects to close the acquisition next month. The companies didn't provide any financial information about the acquisition.

Oracle's recent purchases have tended to focus more on buoying up the company's applications business than its database and middleware operations, with the vendor earlier this month agreeing to acquire business intelligence applications vendor Hyperion for $3.3 billion.

Oracle plans to integrate Tangosol's technology with its Fusion middleware, its TimesTen in-memory database and its enterprise-level Oracle Database, the vendor said. The intention is to create a middleware stack that can support applications carrying out real-time data analytics, grid-based in-memory computation and high-performance transactions. Oracle acquired TimesTen in June 2005 and last month released the first major version of the in-memory relational database developed within Oracle since the purchase.

Tangosol has more than 100 customers including Delta Airlines, FedEx, Macy's, Starwood and Wachovia and over 1,500 deployments of its software around the world.

Oracle committed to carry on supporting and developing Tangosol's software both as an independent product line and integrated with Fusion middleware. Oracle will not require Tangosol customers to use Fusion and plans to continue developing the Coherence software so it can function independent of middleware.

"It's part of our pluggable strategy where we make sure a product offering can be used in an existing environment," Harris said. Coherence supports middleware from vendors including BEA, IBM, Microsoft, Oracle and Red Hat's JBoss division.