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Open source business intelligence software stands to gain ground in a tight economy

Open source business intelligence software could stand to gain as companies look for affordable ways to make the most of their data with an economic downturn on the horizon.

The news is disheartening: The economy is headed into recession, if it isn't there already, and IT budgets are feeling the pinch. But that doesn't mean companies are putting their business intelligence (BI) plans on hold, especially if those plans involve open source software.

Just last month, open source BI vendor JasperSoft Corp. recorded its 80,000th deployment, making it the world's most widely used BI software, according to the company. Nearly 20,000 developers have accessed BIRT Exchange, the open source BI community site sponsored by Actuate Corp. And Pentaho Corp. recently raised $12 million in funding, indicative of investors' confidence in open source BI.

With the cost of a typical commercial BI software deployment reaching well into six figures, open source BI software is an attractive option for many cash-strapped businesses and offers them a less expensive way to tap into the power of their data. And with a community of developers regularly adding code, new and customizable open source features emerge more frequently than do those of their commercial counterparts.

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But open source doesn't mean free, and companies considering it still need to set aside budget dollars to cover maintenance and support fees.

"Open source is coming on," said David Stodder, an analyst with Ventana Research Inc. "There's interest in it and companies are growing more comfortable with it. In fact, research we did last year showed that people didn't have any [reservations] with open source business intelligence."

Open source in a tight economy

An economic downturn, in fact, may actually prove to be a boon for open source BI vendors. CIOs regularly highlight BI as a top priority, but with fewer resources, buying expensive software from commercial vendors like Business Objects and Cognos is difficult to justify. Investing in open source BI software, meanwhile, is a much easier sell.

But the benefits extend beyond a lower price tag.

Downloading and installing open source BI software, for one, is usually a quick proposition. Actuate's iServer Express, an open source report server for its BIRT Eclipse reporting tool, can be deployed in under an hour, according to Vijay Ramakrishnan, marketing director for the San Mateo, Calif.-based software maker's Java group. Just try that with a commercial BI offering.

A large and active community of developers, both outside and within the vendors themselves, also means the upgrade cycle for open source BI software is significantly shorter than it is for commercial offerings, which sometimes last for years.

"Where as in a commercial vendor they're still kind of working on the model of maybe one big upgrade per year, or maybe two, in the open source community, there's the possibility that you'll be getting incremental updates all the time," said Stodder.

San Francisco-based JasperSoft, for example, released 30 enhancements to its open source BI software last year alone, according to Brian Gentile, the company's CEO and president.

And the open source model makes customization easier. A company can deploy an open source BI system, gauge user reaction, then work with its own developers and the developer community at large to reshape the software to satisfy its particular needs. Commercial software can also be tailored, but the process is usually more cumbersome, as the code needed to make changes is not open to outside developers and can only be customized by the vendors themselves.

You get what you pay (or don't pay) for

The open source model benefits the vendors, too, of course. Most offer basic versions of their software for free and make its code available to outside developers. The vendors make money by charging for support and maintenance, and by selling premium versions of their BI software.

And there's the catch.

Most open source BI software can't compete with their commercial cousins when it comes to functionality, Stodder said. Though free offerings from JasperSoft, Actuate and Pentaho can handle basic reporting and data analytics, for more sophisticated features, like complex graphical reports and drillable charts, customers often need to upgrade to -- and pay for -- professional editions.

JasperETL Professional, JasperSoft's data integration platform, for example, comes with a multi-user metadata repository for developers and an activity monitor to keep an eye on data volumes, according to JasperSoft's website. Those are two features that the free, open source version lacks.

The price tag for professional-grade open source BI software is usually significantly lower than for commercial software, however. For its full BI suite, which includes reporting, analytics and ETL tools, JasperSoft charges $25,000 for a year's worth of licensing and support, according to Gentile, while Pentaho's Open BI Suite starts at $30,000 per year. Actuate's Business Report Studio goes for $695 per user per year.

Companies considering open source BI software must evaluate their options carefully, Stodder said. They need to evaluate it with a keen eye for which features are essential and which are not.

"People who are shopping in the open source community for BI tools have to look very carefully at what's being offered for free and if what's being offered for free is enough to do what they need [it for]," Stodder said.

Still, although fees can add up depending on the size of deployment and amount of staff training needed, open source BI software generally carries a significantly lower total cost of ownership than commercial software. With IT budgets tight, but demand for BI rising, that may be reason enough for most CIOs to give open source a try.

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