Spending in emerging markets and in Western Europe helped the worldwide business intelligence (BI) software market grow to $5.1 billion last year, an increase of 13% from 2006, according to Gartner Inc.
But BI spending in the U.S. slowed "drastically" to 5% in 2007, thanks in part to a looming recession and a weak dollar, according to the Stamford, Conn.-based analyst firm. U.S. spending grew a healthy 16% in 2006, before the subprime mortgage crisis put a drag on the U.S. economy.
The biggest winners were the so-called mega-vendors – SAP, IBM, Oracle and Microsoft – which together increased their market share from 20% in 2006 to 66% in 2007, mainly through acquisitions. SAP and IBM completed acquisitions of Business Objects and Cognos, respectively, in January of this year. MeanwhileOracle bought Hyperion in March 2007.
A combined Oracle and Hyperion tied Microsoft for 4th overall, each with 10.6% market share. Still, Gartner predicts that independent BI vendors will play an important role going forward. "Others" controlled over a quarter of the BI market in 2007.
The BI market has undergone "a pendulum shift from a market driven by best-of-breeds to one dominated by mega-vendors," said Dan Sommer, senior research analyst at Gartner, in a statement. "However, many smaller independent BI vendors grew faster than the market, and we expect continued innovation and new vendors to enter the market."
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Source: Gartner (May 2008)