BI Questions Blog

I was recently asked for my thoughts on BI market consolidation for a BI supplement to The Times newspaper:

The BI market has been remarkably fragmented for a long time. According to IDC, the market share of the top 5 BI vendors (Business Objects, SAS, Cognos, Microsoft, Hyperion) barely changed over the period 2004-2006, from 46% to 48%, and non-top-15 vendors consistently made up over 30% of the market.

But -- following the trend of other technology markets -- it seems that the spiral of increasing dominance of a handful of vendors has finally been unleashed.

(1) The leaders are breaking away from the rest of the pack. The M&A activity we've seen in 2007 (Business Objects buying Cartesis, Oracle buying Hyperion, SAP buying Pilot and Outlooksoft, etc.) has increased the dominance of the top players, pushing their combined market share past 50% for the first time.

(2) BI and PM convergence is accelerating the process. The business intelligence and performance management markets (including financial applications) are clearly converging. This means a larger market, fewer vendors that can provide a complete offer, and hence increased consolidation.

(3) The importance of independence is increasing. As BI deployments become larger and more organizations implement a strategic approach, being open and independent becomes more important. I believe independent vendors are better able to concentrate on the best possible implementation of BI, rather than having to promote any particular database, middleware, or set of applications. They also tend to be the innovators in the industry (e.g. Cognos' early move into EPM, Business Objects' recent moves into unstructured data and BI on demand).

In summary: the market is consolidating, and the independent vendors have the most to gain. The latest growth figures from Business Objects (over 23% year-over-year in 2Q 2007, roughly double the predicted market growth) seem to back this up.

Posted by Timo Elliott at 01:43 PM | Permalink | Comments (0) | TrackBacks (0)

UPS minimizes left-turns. Advanced route planning minimizes fuel consumption and accidents. An old story, but given new life with a recent InformationWeek interview with UPS CIO Dave Barnes (and a good example of delivering effectively on a strategic multi-year IT project).

Facebook's community app platform. As BI vendors try to web-2.0 themselves, they will need to create communities -- will they start turning to new platforms, such as Facebook's? From the look at the applications available so far, no -- but over 25s are their fastest-growing segment, and there's at least some interest in the enterprise space: "interesting... harder to build than consumer... maybe ability to better integrate applications some down the line". Disclosure: I only signed up two weeks ago...

MySQL going public? How much is open-source worth in the BI space? This will presumably be eagerly watched by open-source BI vendors such as Pentaho. I'm a big fan of iStockPhoto for cheap, royalty-free images for presentations, and it turns out that they use Pentaho and MySQL.

SAP's Performance Management Blog. Nenshad Bardoliwalla was at Hyperion before joining SAP. His blog gives insight into how the acquisition of Outlooksoft fits into SAP's strategy (with link to SAP's CPM presentation in May), and talks about Pilot's web 2.0 approach to strategy (see previous posting.)  And some inevitable Oracle/Hyperion bashing.

Microsoft PerformancePoint a tough sell? Stephen Sawyer writes that Office, Excel and confusion shaping up as PerformancePoint Server’s biggest competition.

Posted by Timo Elliott at 01:44 PM | Permalink | Comments (1) | TrackBacks (0)

In two earlier posts, "What's in a Name?" and "Putting the Business Back into Business Intelligence", I talked about the ongoing debate about what we should all call the combination of business intelligence and performance management. With the recent wave of PM acquisitions by Oracle (Hyperion), SAP (Pilot and OutlookSoft), and BusinessObjects (Cartesis), the two markets are clearly becoming one.

As Cindi Howson points out in her blog, this trend is probably more vendor-driven than customer-driven, but that doesn't mean it's won't ultimately benefit customers. The views of CFOs and CIOs are (slowly) converging on what's required for a consolidated view of performance across the organization.

So what's the latest on what some of the leading analyst groups are calling the new single market?

Gartner: Based on a new research note published last week, it sounds like Gartner has decided that their new term is -- wait for it -- "business intelligence and performance management":

Business intelligence (BI) and performance management (PM) is an umbrella term that encompasses and defines a continuum of applications, technologies and methodologies to support a user's access and analysis of information and improve insight, decision making and performance management.

IDC: For IDC, BI and PM are both part of a larger category called "Performance Management Tools and Applications", which also includes CRM, SCM, Workforce Analytics, and Spatial Analytics. And PMTA is in turn part of the "Business Analytics" market, which also includes data warehousing.

Forrester: Forrester has started using the term "business performance solutions" (BPS) instead of performance management, defined as "applications for planning, measuring, and reporting business performance" . But it doesn't appear to include "BI"...

Why do I care? Unclear categories and naming makes it (even) harder to understand what these products do, and how they relate to business concerns and the IT infrastructure. There's still a clear opportunity for a new business-focused category which reflects the reality of the market today and, ideally, doesn't add confusion by trying to extend or repurpose an existing term.

Posted by Timo Elliott at 03:40 PM | Permalink