Larry Walsh wrote an interesting post this week, Splunk Disrupts Security Log Auditing, in which he claims that Splunk's success is due to capturing market share in the security log auditing market because of it's Google-like approach to storing log data rather than using a "relational database."
There was also a very good blog post at Securosis in response – Splunk and Unstructured Data.
While there is no doubt that Splunk has been successful as a company, I am not so sure it's due to security log auditing.
It's my understanding that the primary use case for Splunk is actually in Operations where, for example, a network administrator wants to search logs to resolve an Alert generated by an SNMP-based network management system. Most SNMP-based network management systems are good at telling you "what" is going on, but not very good at telling you "why."
So when the network management system generates an Alert, the admin goes to Splunk to find the logs that would show what actually happened so s/he can fix the root cause of the Alert. For this use case, you don't really need more than a day's worth of logs.
Splunk's brilliant move was to allow "free" usage of the software for one day's worth of logs or some limited amount of storage that generally would not exceed one day. In reality, a few hours of logs is very valuable. This freemium model has been very successful.
Security log auditing is a very different use case. It can require a year or more of data and sophisticated reporting capabilities. That is not to say that a Google-like storage approach cannot accomplish this.
In fact, security log auditing is just another online analytical processing (OLAP) application, albeit with potentially huge amounts of data. It's been at least ten years that the IT industry realized that OLAP applications require a different way to organize stored data compared to online transaction processing (OLTP) applications. OLTP applications still use traditional relational databases.
There has been much experimentation about ways to store data for OLAP applications. However, there is still a lot of value in the SQL language as a kind of open industry standard API to stored data.
So I would agree that traditional relational database products are not appropriate for log management data storage, but SQL as a language has merit as the "API layer" between the query and reporting tools and the data.