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TBR Webinar: Agility as the Key to Revenue Growth in the BI Software Market

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BI software vendors will align portfolios and go-to-market strategies with customers’ evolving BI needs in 2014. Embedding BI functionality into applications enables vendors to balance serving …

BI software vendors will align portfolios and go-to-market strategies with customers’ evolving BI needs in 2014. Embedding BI functionality into applications enables vendors to balance serving advanced BI customers, who have considerable experience and know exactly which tools they need to expand deployments, and basic BI customers, who are late adopters who are investigating the tools but do not yet know what they need. For the customer that is well versed in the use of analytics, having the tool built into the application enables them to more effectively accomplish their goals. For the late adopter, having the tool built into the application provides them with a preconfigured starting point based on other clients’ best practices. TBR’s landmark BI Software Vendor Benchmark examines the current front-runners in the market, how well they are doing and where their attention is focused.

TBR’s Software Practice team invites you to a webinar on Tuesday, April 8, 2014, to discuss the findings of this benchmark, which expounds upon topics such as market directionality, trend information, and predictions.

Matt Healey, principal analyst in TBR’s Software and Cloud Practice, and Enterprise Software Senior Analyst Elizabeth Hedstrom Henlin will share their perspectives on market-making buyer trends within BI software and provide webinar attendees with strategic projections around vendor and customer activity. They will then field questions from the audience.

Questions for discussion will include:

• How are customers’ buying behaviors continuing to influence the maturing BI software market?
• Where can professional services vendors join the conversation around BI software? Which software vendors are best positioned to be CY14 growth partners?
• What are pureplay firms’ evolving tactics to disrupting enterprise software vendor strengths as a path to growth?
• How will enterprise software vendors respond to pureplay threats, moving from install base defense to broader growth opportunities?

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  • 1. TBRT ECH N O LO G Y B U SIN ESS RESEARCH , IN C. Agility as the Key to Revenue Growth in the Business Intelligence Software Market Insights from TBR’s 4Q13 Business Intelligence Software Vendor Benchmark Technology Business Research Quarterly Webinar Series April 8, 2014
  • 2. TBR 2 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 Business Intelligence (BI) Software Vendor Benchmark: Presenters Matt Healey Principal Analyst Email: matthew.healey@tbri.com Twitter: @Mhealey_TBR Elizabeth Hedstrom Henlin Senior Analyst, Software and Applications Email: elizabeth.hedstromhenlin@tbri.com Twitter: @EAHHTBR
  • 3. TBR 3 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. TBR delivers actionable intelligence on the maturing BI market to help clients bridge the gap between buyer aspirations and vendor actions Note: Software vendors under consideration for 2014 report launch include Tableau Software, Splunk and QlikTech; TBR also publishes a semiannual vendor report on SAS Institute in the second and fourth calendar quarters. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Program Overview
  • 4. TBR 4 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Overview TBR evaluates the business intelligence (BI) software market across 4 key segments and across a main model of delivery Note: Business Intelligence and Analytics Engineered Systems is discussed as an accretive revenue model and delivery component within this benchmark, reflecting some contributions from all four software segments. Integrated solutions encompassing multiple points of BI functionality in a single product Point products addressing single- or dual- purpose deployments of BI functionality Data warehousing and related information management products deployed in support of business intelligence Basic BI Tools Advanced BI Tools Data Warehousing Business Intelligence and Analytics Engineered Systems BI Applications and Platforms Delivery method for BI software, inclusive of hardware, software and support revenue
  • 5. TBR 5 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Overview Subsegments within TBR’s BI software taxonomy align to buyer maturity and the features they self-select along their BI purchasing journey TBR BI Software Taxonomy Subsegments Reporting, Queries, Spreadsheets Basic BI Tools Dashboards, Scorecards Online Analytical Processing (OLAP) Data Discovery
  • 6. TBR 6 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Overview Subsegments within TBR’s BI software taxonomy align to buyer maturity and the features they self-select along their BI purchasing journey (cont.) TBR BI Software Taxonomy Subsegments Data Mining Advanced BI Tools Event Processing Data Visualization Content Analytics Predictive Analytics
  • 7. TBR 7 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Key Takeaways: TBR’s 4Q13 Business Intelligence Software Vendor Benchmark
  • 8. TBR 8 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook CY4Q13 BI Software Market Summary To drive growth in a maturing BI software market, vendors focus near- term investments on S&M to keep customers engaged BI Software remains a critical priority for customers and provides enterprise software vendors like IBM, SAP, Oracle and HP with an opportunity to jump-start license sales and possibly improve overall market positions. Basic and Advanced BI Tools segments remain a category for multi-line vendor investigation – evaluating and acquiring disruptive technologies to accelerate solution creation. Pure-play BI firms including Splunk and Pentaho are accelerating investments ahead of competitive firms, scaling S&M and R&D as a percentage of revenue, respectively, to find the next wave of growth.
  • 9. TBR 9 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. 2013 BI Software Market Outlook
  • 10. TBR 10 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook CY4Q13 BI Software Market Summary To drive growth in a maturing BI software market, vendors focus near- term investments on S&M to keep customers engaged BI Software remains a critical priority for customers and provides enterprise software vendors like IBM, SAP, Oracle and HP with an opportunity to jump-start license sales and possibly improve overall market positions. Basic and Advanced BI Tools segments remain a category for multi-line vendor investigation – evaluating and acquiring disruptive technologies to accelerate solution creation. Pure-play BI firms including Splunk and Pentaho are accelerating investments ahead of competitive firms, scaling S&M and R&D as a percentage of revenue, respectively, to find the next wave of growth.
  • 11. TBR 11 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook The BI software market remains largely fueled by the actions of enterprise software leaders, but disruptors continue to evolve the landscape TBR Estimates — BI Software Market Estimated 4Q13 YTY growth across the landscape: ~13% Estimated 4Q13 YTY growth across covered vendors: ~8%
  • 12. TBR 12 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Covered Vendors BI Revenue Growth: Percentage and Dollar Growth Laggards Leaders Hadoop vendors including Hortonworks and Cloudera emerge as 4Q13 BI growth leaders, gaining traction with alliances and proven performance Pure-play vendors including Hortonworks, DataStax and Domo are breaking away from the pack in terms of revenue growth, as they capitalize on momentum from funding rounds to increase R&D efforts and expand global presence. Revenue contribution leader IBM’s recent acquisition of Cloudant enables it to more effectively compete against high-growth vendor DataStax’s Cassandra offering in the Database as a Service market. NOTE: Kaggle is excluded from current averages. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook
  • 13. TBR 13 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. BI Software Market Segmentation
  • 14. TBR 14 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook CY4Q13 BI Software Market Summary To drive growth in a maturing BI software market, vendors focus near- term investments on S&M to keep customers engaged BI Software remains a critical priority for customers and provides enterprise software vendors like IBM, SAP, Oracle and HP with an opportunity to jump-start license sales and possibly improve overall market positions. Basic and Advanced BI Tools segments remain a category for multi-line vendor investigation – evaluating and acquiring disruptive technologies to accelerate solution creation. Pure-play BI firms including Splunk and Pentaho are accelerating investments ahead of competitive firms, scaling S&M and R&D as a percentage of revenue, respectively, to find the next wave of growth.
  • 15. TBR 15 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook Enterprise software vendors capitalize on their established presence in the Basic BI Tools segment to maintain growth leadership positions Profit leaders Dell and Oracle are able to capitalize on established brands and targeted messaging to attract net-new BI adopters while maximizing S&M spend efficiency. IBM’s ability to tailor its existing complex analytics solutions to meet the needs of C-suite executives (highlighted by the launch of SPSS Analytic Answers) enables the company to sustain revenue growth leadership while keeping R&D costs low. NOTE: Kaggle is excluded from current averages. Both Informatica and Google have the ability to monetize targeted portfolios for growth in Basic BI Tools, and will look to partner-led growth opportunities as a path to profitable expansion.
  • 16. TBR 16 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook Growing C-suite use of predictive analytics will increase vendors’ investment in Advanced BI Tools point products in broader portfolios IBM expanded its predictive analytics capabilities in 3Q13 with the launch of SPSS Analytic Answers, which TBR believes will be a differentiated product across CY14. Predictive analytics will be a key component of vendors’ BI portfolios, as the C-suite increasingly adopts analytics tools to gain insights from their core business data. Enterprise vendors will risk negatively impacting margins to either internally develop or acquire predictive analytics capabilities. SAP expanded its advanced BI capabilities with the September acquisition of KXEN, while Dell Software is poised to enter the space in 2H14 with its March acquisition of predictive analytics vendor StatSoft. NOTE: Kaggle is excluded from current averages.
  • 17. TBR 17 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook CY4Q13 BI Software Market Summary To drive growth in a maturing BI software market, vendors focus near- term investments on S&M to keep customers engaged BI Software remains a critical priority for customers and provides enterprise software vendors like IBM, SAP, Oracle and HP with an opportunity to jump-start license sales and possibly improve overall market positions. Basic and Advanced BI Tools segments remain a category for multi-line vendor investigation – evaluating and acquiring disruptive technologies to accelerate solution creation. Pure-play BI firms including Splunk and Pentaho are accelerating investments ahead of competitive firms, scaling S&M and R&D as a percentage of revenue, respectively, to find the next wave of growth.
  • 18. TBR 18 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Existing business models ensure enterprise software BI businesses’ spend trends in line with corporate growth, but BI remains a clear priority S&M and R&D as Percent of Revenue: Enterprise Software Vendors Both Informatica and Dell Software are growing their BI market portfolios, prioritizing S&M and R&D spend together to accelerate sales, install base growth and create revenue gains while minimizing potential performance erosion of core products. IBM Software’s acquisition-led approach to market expansion, including BI, positions the firm to refocus on R&D spend as a path to an integrated portfolio across 1H CY14. HP Software’s focus on BI will continue across CY14, with TBR projecting a move into the “Monetize BI Business” quadrant by the end of CY14. Sales as Rising Priority Monetize BI Business Innovate and DevelopStable Portfolio TBR believes Oracle is shifting investment to accelerate BI portfolio integration and growth, aligning BI assets to applications portfolios as an assault on competitors such as IBM, SAP and Microsoft. 2Q13 Position 4Q13 Position Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook
  • 19. TBR 19 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Public and private BI pure plays are prioritizing growth, but most are mirroring enterprise counterparts in quarterly spending patterns S&M and R&D as Percent of Revenue: Pure-play BI Vendors Sales as Rising Priority Monetize BI Business Innovate and DevelopStable Portfolio Splunk is increasing investment across segments, countering industry trend to accelerate growth. Both QlikTech and Pentaho, maturing following IPOs, are demonstrating spend in alignment with mature competitors, but Pentaho’s increasing R&D spend suggests new products in development. Teradata will be challenged to raise its profile relative to competitors such as Oracle without escalating S&M spend relative to the median. TBR notes that Salient and Information Builders are likely candidates to re- enter the “Innovate and Develop” quadrant in 1HCY14, as these firms evaluate growth alliances and related portfolio integration needs. 2Q13 Position 4Q13 Position Insights from TBR’s 4Q13 BI Software Vendor Benchmark: Market Outlook
  • 20. TBR 20 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. BI Software Market Projections
  • 21. TBR 21 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Tools Tied to High-growth Products and Markets: Raising the profile and adoption of Basic BI tools by attaching them to products in high-growth markets such as cloud. Defend and expand current install bases through integration of BI tools, applications and platforms. Disruptive Technology Driving Cross-segment Growth: Rising Hadoop deployments will disrupt the stable data warehousing market Disruption of mature market segments BI to Revive License Sales: Leveraging integrated BI applications and platforms to defend application install bases. Vendors that incorporate disruptive technology into solutions will increase both customer adoption and market differentiation in CY14 TBR Projections: 2014 & 2015 Business Intelligence Software Vendor Landscape Insights from TBR’s BI Software Vendor Benchmark: Market Projections
  • 22. TBR 22 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Questions?
  • 23. TBR 23 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. For further information, please contact: Matt Healey Principal Analyst Email: matthew.healey@tbri.com Twitter: @Mhealey_TBR Elizabeth Hedstrom Henlin Senior Analyst, Software and Applications Email: elizabeth.hedstromhenlin@tbri.com Twitter: @EAHHTBR James McIlroy Vice President of Sales Email: mcilroy@tbri.com Telephone: 603.929.1166 Twitter: @TBRinc SlideShare: www.slideshare.net/TBR_Market_Insight YouTube: www.youtube.com/user/TBRIChannel LinkedIn: https://www.linkedin.com/company/technology- business-research Insights from TBR’s BI Software Vendor Benchmark: Contact Information
  • 24. TBR 24 TBR Quarterly Webinar Series| 4.8.14 | www.tbri.com | ©2014 Technology Business Research Inc. Syndicated Research Coverage by Vendor Segment Software Vendor Reports (Software Business Quarterly) Benchmarks and Market Landscapes (Benchmark XLS data is also available) • CA Technologies • Dell Software* • HP Software • IBM Software • Microsoft Corp. • Oracle Corp. • Red Hat • SAP AG • SAS* • Symantec • VMware • Software Vendor Benchmark The benchmark currently covers 29 firms, encompassing software license, maintenance and professional services revenue. • Business Intelligence Software Vendor Benchmark* The benchmark includes BI business of select Software Business Quarterly vendors and additional pure-play firms (31 firms as of CY4Q13). TBR Software Practice Syndicated Coverage *Semiannual publication; **Annual publication SourceIT — IT Customer Segment Reports Insight and in-depth study results on N. American and large enterprise budgeting, buyers and competitors across workloads • SourceIT Banking & Financial Services** • SourceIT Healthcare** • SourceIT Public Sector** • SourceIT Retail** • SourceIT Telecom**
  • 25. TBRT ECH N O LO G Y B U SIN ESS RESEARCH , IN C. About TBR Technology Business Research, Inc. (TBR) is a leading independent technology market research and consulting firm specializing in the business and financial analyses of hardware, software, professional services, telecom and enterprise network vendors, and operators. Serving a global clientele, TBR provides timely and actionable market research and business intelligence in formats that are tailored to clients’ needs. Our analysts are available to further address client- specific issues or information needs on an inquiry or proprietary consulting basis. TBR has been empowering corporate decision makers since 1996. To learn how our analysts can address your unique business needs, please visit our website or contact us today. Contact Us 1.603.929.1166 info@tbri.com www.tbri.com 11 Merrill Drive Hampton, NH 03842 USA This report is based on information made available to the public by the vendor and other public sources. No representation is made that this information is accurate or complete. Technology Business Research will not be held liable or responsible for any decisions that are made based on this information. The information contained in this report and all other TBR products is not and should not be construed to be investment advice. TBR does not make any recommendations or provide any advice regarding the value, purchase, sale or retention of securities. This report is copyright-protected and supplied for the sole use of the recipient. Contact Technology Business Research, Inc. for permission to reproduce.