Mega-vendors still dominate the business intelligence (BI) software market, but their stranglehold may be loosening...
By submitting your email address, you agree to receive emails regarding relevant topic offers from TechTarget and its partners. You can withdraw your consent at any time. Contact TechTarget at 275 Grove Street, Newton, MA.
as disgruntled customers begin to look for lower-priced, more flexible options from BI pure-plays.
SAP and IBM BI customers, in particular, report lower levels of satisfaction as the mega-vendors continue to iron out their BI product roadmaps and adjust support and maintenance fees, according to Gartner's BI Magic Quadrant report, released last week.
With a weak economy, customers are increasingly looking for cheaper, quicker-to-deploy options like BI embedded within packaged analytic applications and, to a lesser extent, SaaS BI to meet their reporting and analytic needs, said Rita Sallam, an analyst with the Stamford, Conn.-based research firm and co-author of the report.
"Many [BI] pure-plays are leveraging business user impatience with enterprise BI systems and are delivering alternative easy-to-use-and-deploy architectures, alternative business models, and a strong customer focus -- so much so that in many cases business users continued to buy non-stack solutions even when a stack standard is in place," Sallam said in an email interview.
The related data warehouse market is experiencing a similar phenomenon. According to Gartner's Data Warehouse Magic Quadrant, also released last week, smaller data marts and virtual data warehouses that use federation technology are enjoying renewed popularity as companies look to increase flexibility while keeping costs down.
Higher performance requirements from customers are also pushing data warehouse vendors to improve the power of their products through the addition of in-database analytics and column architectures, according to Gartner's Donald Feinberg, who co-authored the report on data warehouses.
Data warehouse appliances – server and storage hardware bundled with analytic databases -- also continue to gain in popularity thanks to their ease of implementation and support, he said.
"The bottom line is [customers] want to call one person for support" when there is a problem with performance, Feinberg said.
Still, in both markets, neither customer unrest nor the desire for quicker, cheaper deployments made much of a dent in the mega-vendors' dominant market share positions, Gartner said. Mega-vendors are themselves responding with more BI and DW deployment options, either developed internally or through acquisition.
"I think there are a few reasons why customers continue to buy into the stack despite an increase in dissatisfaction," Sallam said. "Stack-centric buying is largely IT driven, and stack vendors promise a one-stop shop. They often offer deep discounts or bundle BI platform capabilities with other parts of the mega-vendor stack (e.g., applications or information infrastructure) and offer the promise of integration and optimization with their respective applications and information management stacks."
Three mega-vendors top both BI and data warehouse markets
Appearing in the leaders' quadrants in both the BI and data warehouse Magic Quadrant reports were Oracle, IBM and Microsoft.
Oracle's BI platform has the widest range of capabilities among the top vendors, including reporting, dashboarding and ad hoc query functionality. The vendor also offers three distinct data warehousing options, -- Oracle Database 11g, Oracle Reference Configurations, and Oracle Exadata v2 – "giving customers a wide variety of choices," the report said.
IBM's core BI platform, IBM Cognos 8, was cited for its architectural consistency, "with IBM Cognos customers reporting that they need only three administration staff per thousand users on average," the BI Magic Quadrant report states. Like Oracle, IBM has a number of data warehouse products to meet varying needs.
Microsoft, meanwhile, continues to make inroads in both markets thanks to the ubiquity of its tools -- mainly Excel, SQL Server, and SharePoint Server, according to Gartner. Microsoft will probably expand its market share in 2010 when it debuts PowerPivot, an Excel add-on for BI and analytics, and SQL Server 2008 R2 Relational Database, which is likely to take the form of an appliance.
"The significance is that all three … have the full spectrum of information infrastructure technologies from the database [including hardware in the case of IBM and Oracle] through the middleware stack and -- in the case of Oracle, SAP and Microsoft -- the enterprise applications as well," Sallam said. "Stack vendors do have an advantage in that they can optimize their BI platforms for their respective application and information management stacks."
While the top positions in the BI Magic Quadrant were bunched together – Oracle and Microsoft earned virtually the same ranking -- Teradata was the clear leader in data warehousing. Gartner cited the vendor's products' ability to handle mixed workloads without hindering performance, including near real-time data loading, tactical business analytics and an increasing number of ad hoc queries.
"Teradata's solutions, which include the data warehouse platform, data models and professional services dedicated to data warehousing, set it apart from the rest of the market," Feinberg wrote.
Also earning a place in the BI leaders' quadrant were SAS Institute, Microstrategy, SAP, and Information Builders. Netezza and Sybase rounded out the leaders' quadrant for the data warehouse market.
SaaS, open source BI deployments still small but increasing
While still a small percentage of overall deployments, SaaS BI, delivered both from internal and the public cloud, is slowly but steadily gaining traction, according to Gartner.
"This growth will be accelerated by organizations' increasing need to deploy intuitive BI tools and applications cost-effectively to more users, reduce time to value and time to scale, and lower capital expenditures," Sallam wrote.
SAP and SAS Institute have the largest number of SaaS BI deployments, but smaller up-and-coming vendors like Birst, GoodData, Oco and PivotLink are also getting attention, the report states.
Cloud-based data warehousing, on the other hand, has yet to take off, for a number of reasons, according to Gartner. "The issues around the security, multi-tenancy and latency of use of the Internet as a transport for data loading are among the reasons given for the reluctance to locate the data warehouse in the cloud," Feinberg wrote.
Gartner predicted that both the BI and data warehouse markets would continue to grow this year as companies look to the software to turn their corporate data into competitive differentiators.