Big data hyperbole has caused corporate IT to tighten the purse strings on business intelligence (BI). It is one of five factors that Gartner has identified as compressing and driving spending on BI software.
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Dan Sommer, principal research analyst at Gartner, said business intelligence software expenditure exhibited “muted growth in 2012”, compared with 2011.
Gartner has calculated that worldwide business intelligence, corporate performance management (CPM) and analytics software revenue came to $13.1bn in 2012, a 6.8% increase from 2011 revenue of $12.3bn. It cited tough macro-economic conditions and term confusion, related to emerging technology terms, leading to “more muted market growth than in previous years”.
“After a few historic banner years of spend in the BI software market, which culminated in more than 17% growth in 2011, growth was more subdued in 2012, at 7%." said Sommer.
Most large organisations have BI platforms in place, he said: “They might feel the need to upgrade, but ‘big data confusion’ reigns. Users do not know what it means for them.”
That might change when more concrete use cases for big data analytics emerge, he said, but for now, “people are sitting on their wallets” with respect to BI software.
BI spending is also continuing to move outside IT, he confirmed. And more traditional BI is going into “maintenance mode” as data discovery technologies gain in popularity, especially outside of the IT department. The recent job losses at IBM Cognos are symptomatic, said Sommer.
Data discovery becoming a mainstream architecture and software as a service are, however, drivers of growth, he added.
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Turf war between business and IT
Tableau, Tibco Spotfire and QlikTech conferences are akin to Apple’s, said Sommer, populated by non-traditional BI users whooping at new features. The land and expand strategy typical of the data discovery merchants often targets marketing professionals and other non-IT executives.
But corporate IT is fighting back. “Corporate IT does not want to lose its grip of BI and analytics projects. Instead, it is shielding and prioritising them. And its typical concerns – around data governance and data quality – are important," he said.
“But analysis should sit with the business users – they are living and breathing this stuff. It will also extend to people in the field, on the shop floor, and up the executive suite – big data is a CEO issue.”
BI and analytics will also become more embedded and pervasive, more functionally niche – analytics for sales and marketing, he said. IT services companies will also continue to enter the field, as will information services companies, such as Thomson Reuters and Nielsen.
While all of the top five BI software suppliers – SAP, Oracle, IBM, SAS and Microsoft – retained their top five status, IBM and SAS exchanged places to move IBM into third position and SAS into fourth, according to Gartner. The top five suppliers together accounted for 70% of total BI software market revenue.
In first place, SAP had higher revenue than any other supplier, at $2.9bn, with 22.1% of the market. Second-place Oracle's revenue grew by 2% from 2011 to reach $1.9bn. Fifth-place Microsoft had the highest growth of the top five suppliers in 2012, with revenue rising by 12.2% on 2011 to reach $1.2bn.