Gartner Says Megavendors Are Slowing Business Intelligence Revenue Growth but Increasing Usage by Bundling Applications
Analysts Discuss Changing Business Intelligence Market Dynamics at Gartner Business Intelligence Summit 2009, 20-22 January in The Hague, Netherlands
Speaking ahead of the Gartner Business Intelligence Summit 2009, held on 20-22 January in The Hague, Netherlands, Gartner analysts said that the increase in BI usage by organisations is driven by two factors.
"First, the megavendors will integrate BI in the infrastructure, applications and processes that users already work in, such as email, spreadsheets and other business applications, spreading it to a larger user base. Second, smaller vendors will lead improvements in usability enabled by mash-ups, visualisation, search, Web 2.0, rich-internet environments and in-memory analytics. However, although employees are becoming savvier in their use of data, many still view BI as an isolated technology or activity so it will take time to adjust," said Dan Sommer, senior research analyst at Gartner.
To compete, the megavendors are offering creative financing deals, such as free credit or payments by instalments. This approach has not been common in the software market and might prove an advantage over smaller vendors, which are not in a position to offer such deals. Meanwhile, smaller vendors need to innovate to reach new levels of scalability, usability, advanced functionality and customisation that megavendors can't offer. In a tough selling environment, vendors need to improve and clarify the business case for BI to an audience outside of the IT organisation.
Mr Sommer advises organisations that BI will increasingly be a buyer's market and therefore beneficial to continue to invest in BI, but users must look beyond the up-front costs and consider total cost of ownership. They must also be aware of the risks of dependency on a single vendor's product stack, as well as the risks of overbuying when BI is offered at attractive rates.
Gartner recommends that the focus for end-user organisations should be two-fold when investing in BI. "They need to concentrate on the bottom line - profit margins, operational effectiveness, etc - particularly when there is smaller scope to grow the top line. In addition, they need to review the BI tools they already have - an audit might reveal they have more BI than they thought, particularly as it increasingly comes embedded in other business software," said Mr Sommer.
About Gartner Business Intelligence Summit 2009
Gartner analysts will further discuss BI market dynamics at the annual Gartner Business Intelligence Summit 2009 in The Hague, Netherlands, 20-22 January. For further information on the Summit, please visit www.europe.gartner.com/bi
Gartner UK Ltd
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