The dynamic tiering option in SAP HANA SPS09 gives the ability to keep the data in either memory or on the disk in a columnar format. Data is not duplicated. Dynamic tiering option helps users to choose memory for hot data and disk for warm data, helping to strike the right price/performance balance. To do so, you define the table as “extended table” using an SQL CREATE statement. These tables are like any other SAP HANA tables except for the fact that they are created on the disk and not in memory. From the application developer point of view, these tables can be queried and modified using standard SQL statements, like any other SAP HANA tables. You can join extended tables with in-memory tables and at any point of time, you can convert extended tables into in-memory tables and vice versa, with an SQL ALTER statement.
HOT---->Warm
Dynamic tiering also works with multitenant database containers and you can configure extended storage for each tenant.