BI Tools Market Shows Continued Growth
For the second year in a row, the business intelligence (BI) tools market showed an annual growth rate of 11.5 percent, according to a recent report by IDC, bringing worldwide software revenue to $6.25 billion in 2006. The report adds that the BI tools market appears to be an "attractive market for software vendors" and "one of the top investment priorities for end-user organizations." Dan Vesset, co-author of the report and program vice president of IDC's Business Analytics unit, says that the BI market "remains very healthy."
In the report, "Worldwide Business Intelligence Tools 2006 Vendor Shares," IDC defines business intelligence as a combination of two components: end-user query, reporting, and analysis (QRA); and advanced analytics. QRA software includes applications that are used primarily for data access and report-building by either technology or business users. Advanced analytics are tools used to accomplish tasks that are either "hidden, not apparent, or too complex" to be obtained by QRA software through data mining and statistical software. IDC puts Business Objects atop the QRA category (with an 18 percent share of that market), and, for the tenth straight year, SAS Institute at the top of the advance analytics side (with 30.7 percent of that category). Business Objects led the overall BI tools market with a 14 percent share.
Although the BI software market is growing faster than the overall technology market is, Vesset says that it is still too early to tell if the implementation of a BI strategy has had a significant impact. However, he adds, evolutionary changes will occur as BI software becomes more user-friendly--particularly for non-analysts--and more support technology is developed. (It's also worth noting that the 11.5 percent overall growth rate for the market, while unchanged from 2005, is still a decline from the 12.8 percent growth rate IDC reported in 2004.)
Vesset says that vendors have begun to target a broader audience, and are putting together packages and other software technologies to achieve these demands and to stay at the top of the BI tools market. The report advises end-user organizations to expand beyond traditional query and reporting tools to include "analytics, search and discovery, business process automation, collaboration, and workflow management." In addition, the report recognizes the need for service vendors--system integrators and consulting firms--to help enterprises address the development and implementation of performance management solutions.
The report states that business intelligence software is necessary for "improved performance management." In order to achieve this measure, the report asserts that BI tools can therefore be used to "find or discover information, describe historical or predictive future trends, conduct what-if or scenario planning, and deliver or disseminate information to relevant stakeholders."
Vesset says he believes that the market is mature; as a result, the future should not hold many surprises. He expects that there will be more consolidation, more mergers and acquisitions and the market should continue at a steady growth.
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