BI Goes MainstreamBy Darrell Dunn | Posted 2007-10-30 Email Print
Major acquisitions and increased deployments are pushying bsiness intelligence to the forefront of IT strategy. Here's a look at what works—and what hurdles remain.
As the business intelligence market matures, M&A heats up. In just two years the business intelligence market has grown by about $1 billion—30 percent—in revenue, and the market will total nearly $5 billion this year, according to IDC. This indicates a clear maturation of the market, and it is grabbing the attention of the world's IT giants.
As a result, merger and acquisition efforts within the market are red hot. The frenzy began in earnest in March, when Oracle announced it would buy Hyperion Solutions for about $3.3 billion. In October, SAP announced a "friendly takeover" of BI market leader Business Objects for nearly $5 billion.
"We are definitely seeing that more and more of the big application vendors like SAP and Oracle understand they need to compete more aggressively in the BI market," says Bill Hostmann, an analyst with Gartner. "BI today is still very much an adhoc approach to most businesses—an appendage to the information architecture. These acquisitions are intended to take all that information inside a company and make it available to more people in way that can help businesses figure out what information is really important and what is just a lot of background noise."
Following the SAP-Business Objects announcement, speculation on the next big move centered on an acquisition of Cognos, which IDC ranked the third largest BI provider in 2005. Potential suitors may include IT giants IBM, Hewlett-Packard and Microsoft, which already is fourth in the BI market with about 10 percent of worldwide revenue.
"This is an industry that is at the cusp of going mainstream," says Dan Vesset, an analyst with IDC. "Marker leaders understand that large enterprises are increasingly turning to these tools to get a better understanding of the complex nature of managing IT operations with an eye on business objectives."—D.D.
Total BI Platform Software Revenue For All Subsegments and Regions (Millions)
Source: Gartner (June 2007)