Business Objects, Cognos, Information Builders, and SAS Institute are setting the standards in BI, according to Gartner's "Magic Quadrant for Business Intelligence Platforms, 1Q06." The companies are listed as leaders, with all four offering a range of capabilities across reporting, analysis, performance management, and data integration, according to the report. Microsoft, Oracle, and SAP are listed as close challengers, while Hyperion, MicroStrategy, QlikTech, and Siebel Systems are listed as visionaries, or those companies with potential to become leaders.
The report cites SAS as having the most comprehensive BI platform in the industry, though its marketing strategy needs improvement. Cognos receives positive scores for demonstrating strong vision by restructuring its product line from scratch, though it takes a hit for not demonstrating much success with designing packaged vertical solutions. Meanwhile, Business Objects is noted for offering a wide range of platform capabilities and a strong go-to-market strategy, but the company must expand the role of its Universe brand (which plays well in the SMB space) to become more suitable for large enterprises, according to the report. Finally, although Information Builders receives credit for merging the data integration capabilities of its iWay Software subsidiary to the front-end capabilities of its WebFocus reporting tool, the company has the lowest ranking of any of the leaders, because it's too focused on reporting at the expense of analysis, according to Gartner. "Moreover, its sales strategy is weaker than others, because it has failed to tap the power of the indirect channel and grow its channel and presence outside North America," Kurt Schlegel, research director at Gartner, writes in the report.
Overall, Gartner expects the BI market to grow at a solid pace during the next five years, with new license revenues experiencing a compound annual growth rate of 7.3 percent. In addition, larger organizations are increasing BI spending, especially as they work to comply with government regulations like Sarbanes-Oxley.
The increasing scope of BI platforms to include more users and access more data sources also will perpetuate market growth, according to the report. Traditionally, BI was for senior executives and analysts, but many companies are now extending BI capabilities throughout the organization to other employees. Additionally, BI platforms increasingly will rely on data from a broader array of applications and data sources, as opposed to just databases.
Although Schlegel cites these as positive trends for the market overall, the overabundance of vendors will prevent any one from growing too quickly. The pure-play vendors, including Actuate, Business Objects, Cognos, Hyperion Solutions, MicroStrategy, Information Builders, and SAS Institute, are fighting a three-front war, with pressure coming from database vendors like Microsoft and Oracle, and application vendors like SAP and Siebel, according to the report. Smaller vendors, including Applix, Panorama Software, ProClarity, and QlikTech, also are becoming more pervasive. "Despite a few potential acquisitions, such as Oracle's acquisition of Siebel," Schlegel says, "we expect this market to remain crowded for the next three to four years, with at least a dozen credible vendors."