Although they're not pure-play business intelligence vendors, IBM, Microsoft, Oracle Corp. and SAP AG own two-thirds of the $6 billion BI market because they have optimized their BI platforms to work well with their respective enterprise and information management applications, according to Gartner Inc. This integrated approach, as well as the fact that many enterprises already have these vendors' ERP and information management applications in place, is swaying customers to standardize on one of their BI platforms.
These vendors are slow to innovate, however, and they are being challenged in the enterprise by such up-and-comers as Tableau Software Inc. and QlikTech International AB and by pure-play BI vendors like Information Builders Inc. and Microstrategy Inc., Gartner analysts said during the consultancy's recent Business Intelligence Summit in Las Vegas. Pure-play and niche vendors are introducing interfaces that are more appealing to the masses, along with such technology as interactive visualization tools, scenario modeling and data mashups, which could change the way information is gathered and analyzed.
We've spent tens of millions on BI and need to consolidate down to one system.
Another factor helping niche and pure-play vendors' push into the enterprise is the propensity of customers to introduce more than one BI platform to meet their varying business needs. As of yet, these trends are not diminishing the Big Four's domination, as is evidenced by the BI strategy plans of many conference attendees.
At a home, auto and life insurance company based in Canada, funding is dropping for BI efforts, forcing the BI team to prove the ROI of its software, said Mark Liu, the company's BI architect. "We've spent tens of millions on BI and need to consolidate down to one system," he said, adding that the choice most likely would come down to one of the major vendors.
BI platform consolidation across the enterprise is no easy task, but Gartner's rating of the Big Four vendors' BI features and strategy gives organizations a few points to ponder. Here's the rundown of how the vendors stack up:
IBM: There is a reason IBM is still called Big Blue. Its revenue in 2009 was $95 billion, and Gartner analyst Neil Chandler believes IBM has no gaps to fill in its BI platform. However, there are a few cracks.
Pros: IBM has plenty of money to invest in acquisitions and in launching new services: One is its Business Analytics and Optimization Services Group, which debuted this year. "[This group] was born with 4,000 consultants, so they are investing significantly in BI and their ability to have traction in the space that reaches into corporate performance management (CPM) too, Chandler said during a vendor comparison session at the summit. In addition, IBM invested in predictive modeling and data mining with its acquisition of SPSS Inc., "upping the ante for their ability to provide more forward-looking BI," he said. IBM is the hands-down leader as far as business process management and data quality and integration, compared to other BI vendors, he added.
Cons: IBM does not make ERP applications, a fact that may put it at a disadvantage in organizations that have other vendors' enterprise applications in place. "That gives us some questions of how IBM is being evaluated in SAP or Oracle shops," Chandler said. "However, IBM is telling us that they are doing well in those environments over the last year, and it is not impacting their BI growth generally."
Oracle: The vendor's Siebel and Hyperion products are integrated strongly, and the platform has been renamed the Oracle Business Intelligence Enterprise Edition suite. Integration is also strong between this platform and the vendor's enterprise applications and middleware stack, Gartner analyst Donald Feinberg said. Most of the conference attendees also use Oracle's database management system (DBMS). "Oracle has one of the most complete stacks, I think, that integrates well from applications, now all the way down to the disk drive," he said.
Pros: The vendor clearly has a stronghold on the DBMS market and continues to fill out its data warehouse offerings, the latest of which is Exadata V2. "[Oracle] obviously has a long history with very large data warehouses with pretty solid mixed workloads," Feinberg said. "Exadata has made a huge difference over the last 18 months to put them in a leadership position." Oracle also is addressing the data quality and integration gaps in its BI platform with the acquisition of Silver Creek Systems Inc. in January.
Cons: In addition to being late to the data-quality and data-integration game -- Oracle has made minor data integration tool acquisitions over the years, including Sunopsis SA -- the acquisition of Sun Microsystems remains a huge undertaking. "The big issue for them right now is the integration of Sun into the company and not being sidetracked by that, which is going to be a major effort for Oracle," Feinberg said. "I'm not saying [this is] a positive or negative, it's just a major integration between a hardware company and a software company."
Microsoft: The software vendor is taking a very familiar approach to customer penetration with its BI platform: low-cost bundling. BI capabilities are being built into and across many of its product lines including SQL Server, SharePoint and Office.
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Pros: SQL Server is incorporating reporting; extract, transform and load, or ETL; and online analytical-processing data mining. Dashboards, scorecards and social software enterprise-search capabilities are being added to SharePoint 2010. Office Excel now has more advanced ad hoc analysis, along with PowerPivot, which gives users the power to gather data to the desktop from different sources. "[Microsoft's] BI platform is particularly strong for production reporting for organizations with a Microsoft-centric infrastructure," said Gartner analyst Rita Sallam.
Cons: Not necessarily a drawback, but Microsoft is leaving budgeting and planning up to partners since it dropped those capabilities from PerformancePoint Server. As far as the availability of data quality tools, the vendor is "missing in action," Sallam said, despite its acquisition of Zoomix a few years ago. Its low-cost data warehouse offerings have "catapulted" Microsoft into a leadership position, but not at the high end of the market -- above 5 terabytes to 10 terabytes, she said. This summer, Microsoft plans to debut SQL Server 2008 R2 Parallel Data Warehouse with massive parallel processing, as a result of its acquisition of DATAllegro Inc.
SAP:: The vendor has an "enviable customer base" running massive workloads on its BI and CPM platforms, said Gartner analyst Bill Hostmann. It is this customer base, however, that is causing some problems for SAP. Many customers buy products from SAP because of the ease of integration across its product lines. This is not the case for existing customers of SAP's BusinessObjects BI platform and its Outlooksoft CPM offering. "BusinessObjects and Outlooksoft customers tend to buy best of breed, not an integrated stack, he explained. This bifurcated sales strategy "is a challenge for them."
Pros: SAP is building a next-generation semantic layer into BusinessObjects, and is exploring in-memory database technology with its NetWeaver Business Warehouse Accelerator, Hostmann said. "[SAP] is really bringing down some of their query performance on the [business warehouse] product to some very impressive levels, but they're going to have to balance these innovations against multiple product segments."
Cons: As a result of SAP having multiple product lines, customer support is still a problem. "They have been at the low end in terms of customer support, but they are putting a lot of focus on their [customer support] program to deal with it and regain customer credibility and confidence in terms of support," Hostmann said. A new leadership team -- CEO Leo Apotheker and BusinessObjects' unit head John Schwarz resigned in February -- is also pushing these changes from the top down, he said.
Given the rise of so many niche and pure-play BI vendors, the Big Four realize they too need to be more cutting-edge. They are making strides in that direction by developing or acquiring technology in such areas as in-memory analytics, integrated search and columnar databases.
Let us know what you think about the story; email Christina Torode, News Director.