Table of Contents
- Overview
- Key Messages
- The wave of consolidation may be beneficial to bothacquiring and
acquired companies
- Opportunities from the BI market will still remain solidin real terms
- As market dynamics change, technology will becomeincreasingly
customer-focused
- End-users should be aware of long-term implications andlook beyond
current turmoil
- Intensifying competition and the entry of larger playerswill integrate
the value-chain
- Conglomerates will try to bridge portfolio gaps whilesmaller players
exploit niches
- Go-to-market strategies will need to be re-evaluatedagainst current
market challenges
- Table of figures
- Table of tables
- Market Opportunity
- The pure-play vendor-dominated BI market is undergoing awave of
consolidation
- Consolidation is a likely win-win for acquiring andacquired companies
- Conglomerates will be able to boost growth rates andprofitability
riding on BI solutions
- Acquired vendors will be able to combat revenue and margingrowth
challenges better
- Price competition and cost inflation has started to affectpure-play
vendors
- Microsoft and other conglomerates are trying tocommoditize basic BI
further
- Consolidation will expand the addressable market for BI,benefiting
pure-play vendors
- A stabilizing market growth rate still leaves enough roomfor revenue
expansion
- Increasing organizational data, shifting userdemographics, and
convergence will drive BI
- Data explosion will continue to fuel demand for monitoringand analysis
- A younger user demographic will adopt BI tools faster
- Convergence will help to expand the addressable market
- Recessionary signals and traditional hindrances to BI mayslow down uptake
- A recessionary environment may affect vendors with highexposure to
financial service firms
- Vendor consolidation may foster a "wait-and-see"attitude in
end-users
- Traditional roadblocks to BI will still remain
- Long-term growth opportunities exist in spite of theturbulence from
consolidation
- Technology Evolution
- Attractiveness of converged bundles to drive acceleratedend-user adoption
- Pre-integrated product bundles
- Add-on industry bundles
- Alternative approaches to data analysis may becomemainstream in the
medium-term
- In-memory analytics could be to BI what just-in-time (JIT)is to
manufacturing
- In-memory analytics is faster, simpler and more flexible
- Natural language processing will help BI to analyzecritical but
oft-neglected data
- Mobile BI could shift from a ' good-to-have' to a' should-have' feature
for reporting
- Technology evolution has been relatively tepid butincreasingly customer
focused
- Customer Impact
- Acquisition frenzy may foster a "wait and see"attitude in
end-users
- End-users can derive short-term gains as conglomerateschase market share
- Best-of-breed products and features will probably beretained over the
long-term
- The entry of conglomerates will help end-users looking forend-to-end
solutions
- Short-term end-user impact is minimal, but expect somelonger-term
rationalization
- Competitive Landscape
- Conglomerates, mid-layer, and niche vendors form thecurrent BI market
- Conglomerates
- Mid-Layer
- Niche
- Timing of acquisitions important as valuations driven upby demand
- The reshuffling of vendor categories has disturbed thetraditional BI
value chain
- A highly converged future value chain will still containniches for
smaller players
- Pre-integrated product bundles will increase adoption anddrive
pervasiveness
- Add-on industry bundles will deliver industry-orientedsolutions,
generating higher value
- Complete BI bundles will deliver end-to-end solutions andunlock
maximum value
- In spite of converged offerings, some gaps will likelyexist for
smaller vendors
- The BI sector could also witness the entry of additionalvendors
- Possible scenarios in the converging market
- An integrated value chain requires conglomerates to bundleas others
develop niche skills
- Go to Market
- Look for bundling opportunities when creating new productofferings
- Establish footprint into large enterprises and growth SMEsthrough
pre-integrated bundles
- Target business and industry issues in large enterpriseswith add-on
industry bundles
- Exploit sub-prime concerns and recessionary signals tohard-sell risk
management BI
- Capitalize on channel partnerships and hosted solutions toreach SMEs
- Develop SaaS offerings and innovative pricing models forprice
sensitive SMEs
- Leverage channel partnerships to target SMEs that havelimited in-house
IT infrastructure
- Recommendations
- For conglomerates:
- Conceptualize, develop, and market bundles at everyopportunity
- Use size and financial muscle to your advantage
- For pure-play vendors:
- Innovate with agility
- Exploit gaps
- Advanced capabilities gap
- Vendor independence gap
- Relationship gap
- Industry alignment gap
- Capitalize on partnerships
- APPENDIX
- Definitions
- Methodology
- Further reading
- Ask the analyst
- Datamonitor consulting
- Disclaimer
- List of Tables
- Table 1: Major acquisitions in the business intelligencemarket, 2006-2008
- Table 2: Current BI bundles consist of product andindustry bundles
- Table 3: Future BI bundles will combine BI with otherapplications to
derive actionable intelligence
- Table 4: Respondents' mobility investment plans
- Table 5: Probability of various BI features to beoffered on mobiles
- Table 6: Respondent' s preferred approach to buying BI
- List of Figures
- Figure 1: Some BI vendors are growing at a higher pacethan their
acquirers
- Figure 2: BI vendors exhibited higher margins than theiracquirers in 2007
- Figure 3: A majority of BI vendors are witnessing aslowdown in revenue
growth rates
- Figure 4: Several BI vendors are reporting a decline ingross margin
- Figure 5: Growth rates are stabilizing to moresustainable levels
- Figure 6: Relatively mature segments such as retailbanking will witness
a gradual slow down
- Figure 7: High exposure of BI vendors to financialservices customers
could put them at risk
- Figure 8: The mobile applications market is growing at ahealthy pace
- Figure 9: Number of respondents that currently use orwill use mobility
solutions
- Figure 10: Acquisition multiples and sizes of four majorBI M&A deals
(2006-2007)
- Figure 11: Traditional value chain: limited overlapbetween layers
resulting in commoditization
- Figure 12: Consolidated value chain
- Figure 13: Scenario planning diagram
- Figure 14: Take hosted BI offerings to the UK, Benelux,Australian, and
French markets
- Figure 15: Targeting SMEs requires a formidable localand national
reseller base
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