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Business Intelligence's Feeding Frenzy: Page 2

By Sean Gallagher     Feedback
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Either way, however, there's still plenty of room for growth in the BI market.

"I think the interesting thing here is when you talk to the independent BI players, they'll share with you the same metrics," said Credit Suisse analyst Jason Maynard during the company's 2007 Annual Technology Conference in November. "'We're only 10 to 15 percent penetrated in the user base, we have a huge opportunity, open field, it's green, we can go sell forever in there.'"

With this kind of attitude, it's not surprising that new BI startups are springing up rapidly.

"I track over 300 BI companies now," Evelson said. Some are software-as-a-service efforts; others, like JasperSoft and Pentaho are based on open-source software models.

Yet all may not be as rosy in the BI world as those figures may suggest. In spite of the growing attraction from both customers and vendors, BI remains difficult to implement.

"I've talked to a lot of customers about business intelligence and the one thing that they tell me is it's really hard to use," said Peter Klein, the chief financial officer for Microsoft's Business Division, during at the Credit Suisse conference.

"'I'm not getting the value out of the investment that I made,'" Klein said customers had complained. "'I have invested a lot in my back-end systems, and today 10 percent or less of my employees actually touch it, or get access to the data. I've got six different BI solutions across multiple different departments, none of which talk to each other. And they're hard to use, so I've got to send people to training for two weeks to learn how to use it."

One fortunate outcome of BI's integration difficulty, however, has actually benefited the industry. Namely, the challenges of implementing BI have prevented it from becoming commoditized, Evelson said.

"Even though the market is consolidating, it's not commoditizing," he said. "It's all about customization, and understanding customer requirements, and tweaking. It's still very much an art and not a science."

Because of that, business intelligence has become a major driver of services business -- with $5 to $7 in service revenues for every dollar spent on BI software, according to Forrester Research.

"There are now 100-plus BI consulting companies," Evelson said. "It's like a feeding frenzy."

This article was originally published on December 28, 2007
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