BI Tools News Alert July 2019 | The BI Market is shrinking

Acquisitions lead to BI market shrinking

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BI tools news alert July 2019

During the month of May, the market for BI platforms and analytics carried on like business as usual, but early June brought with it breaking news. The BI community was shaken up by the acquisition of two promising BI Tools vendors, and there were some high-profile failures at two well-known specialists of big data solutions.

Looker and Tableau acquired

Let’s start with the acquisitions. Firstly, the Santa Cruz-based niche player Looker was acquired. Looker, mostly known for LookML as an alternative to SQL, disappeared into the Google cloud for 2.6 billion USD. Hardly a moment passed before Salesforce announced they were absorbing the Seattle-based market leader Tableau for 15.7 billion USD in stocks. Are customers going to have any choice left?

At the time of this writing, it’s hard to guess what the exact consequences are going to be for current and future customers, distributors, and other partners of the two acquisition targets. As is usually the case, a lot of reassuring words are thrown around. Talk of synergistic benefits and greater financial security and fantastic marketing opportunities abound, for both Looker and Tableau. The proof, as always, is in the pudding.

Greater dependence on dominant market forces

One thing is certain, this new wave of takeovers in the BI scene means that customers become ever-more dependent on a select few dominant parties. That doesn’t make negotiation for potential new clients any easier, generally speaking. On top of that, an open question looms: to what extent are the acquiring parties prepared to keep investing in the innovation of the products and services of the acquired BI solutions? It remains to be seen for how long Google and Salesforce are prepared to keep investing in the Looker and Tableau brands.

Zooming in on the announced acquisitions, several details jump out:

Leveraging the digital transformation

Salesforce is paying the current stockholders of the publicly traded Tableau in stocks, while Google is paying the stockholders of the privately funded Looker in cash. The difference in value between the transactions is also considerable. Tableau is worth 6 times more than Looker. That makes sense when you consider that Looker was being financed by E-funding until recently, and Tableau is more mature. Tableau has been publicly traded since 2013, which has allowed it to work on a higher market capitalization for much longer.

Data is the foundation

Salesforce claims that their acquisition of Tableau represents a very strong proposition. There’s a match between the company cultures, as they both claim to be focused on the success of their customers. Together, they hope to function as a supercharger for the digital transformation. The market leader for CRM systems and the leader of end-to-end analytics platforms are bundling their platforms to help customers with the digital transformation. “Data is the foundation for every digital transformation”, according to Salesforce. Tableau’s CEO Adam Selipsky expects that, with the help of Salesforce, millions of new end users can be served with his platform and its actionable insights.

The potential market for companies struggling with the digital transformation is estimated at 1.8 trillion USD, according to market research firm IDC.

Don’t just look at data – understand it

In short: the vendors are mostly patting themselves on the backs. Whether this benefits the end user remains to be seen, however. Salesforce is expecting a lot out of Customer 360 and Einstein, their own platform, which is already serving clients with AI-based insights in the fields of sales and marketing. Combined with Tableau’s intuitive self-service analytics platform, it hopes to reach a wider audience of customers and end-users in every phase of the customer journey and during every touch point. The mission is to support customers so that they can not only see the data, but also understand it.

Business as usual…?

Over the past sixteen years, Tableau has built up a customer base of around 86,000 customers worldwide, including Netflix, Verizon, and Schneider Electrics. As part of Salesforce, Tableau will continue to operate as an independent brand from its Seattle headquarters, led by the same management team and CEO. “Never change a winning team” seems to be the motto. The communities of both companies, the 1.4 million Trailblazers and 1 million-strong Tableau community, will reinforce each other, according to both parties.

Companies are counting on synergy

Looker is also expecting to reap the benefits of Google’s takeover. After finalizing the transaction and the payment of the 2.6 billion dollars, Looker will immediately be absorbed into the Google Cloud.

Looker, founded in 2012 and based in Santa Cruz, is primarily looking forward to having a greater reach. They expect to have access to more resources and intellectual capital in order to market their so-called unified platform for BI, big data applications, and embedded analytics. From the Google Cloud, Looker will enable its customers to benefit from the synergy generated by combining analytics, machine learning, and AI (artificial intelligence).

Looker has a customer base of around 1,700 companies and institutions, including big names like Amazon, Etsy, IBM, Kickstarter, Lyft, Sony, Spotify, and The Economist. For Google, the Looker takeover is the biggest acquisition since Nest, the smart, “learning” thermostat. Just like Tableau, Looker also expects to be able to offer better support for the digital transformation as a result of the acquisition.

Google’s acquisition of Looker didn’t come out of left field. Both companies already cooperated in the service of their 350 mutual customers, including Buzzfeed, Hearst, King, and Yahoo!

Unifying data

Birst, part of Infor and supplier of BI from the cloud and analytics for big businesses, is introducing Birst 7. The software makes enterprise data modeling, self-service data preparation, end data unification possible within a uniform, user-friendly interface.

Suitable for modeling large, complex schemes

Within Birst 7, Smart Analytics offers a range of new AI functions which offer new, intelligent insights based on machine learning algorithms. Within Birst 7, companies can create trusted KPIs (key performance indicators) and complex business data models for the entire organization. At the same time, it offers decentralized teams the possibility to expand analyses with their own data in a user-friendly, scalable, and repeatable way. Concretely, the new software release offers new possibilities for modeling large, complex schemes, and uploading complex flat files with analysis possibilities and shared connections for centralized and decentralized teams. Complete application metadata en user-defined object localization is supported in over 40 languages, including a completely personalized user experienced for decentralized teams.

New, uniform interface

Birst 7 contains a new, uniform interface for making and managing complex variables and security on a row level and on an individual tenant level, with extensive adjustment and personalization functions for decentralized teams. There are also new management possibilities for cloning complex workflows for data unification, transferring tenant ownership between centralized and decentralized teams, and new, limited monitoring roles for decentralized teams.

Finally, there’s a new administration module for managing centralized and decentralized implementations, including new auditing functions and more detailed possibilities for user management. The centralized compliance and governance remains secure. Birst 7 is available as both a cloud product and an on-premise virtual appliance.

Strong demand for location data

Before the Salesforce acquisition was announced, Tableau introduced new mapping functions, for smoother and smarter use of location data. Version 2019.2 offers functionality for analyzing geo-spatial data and new, so-called authoring possibilities for the user.

Innovation in Ask Data

This new release expands the Mapbox-driven technology for background mapping with vector maps. Users can use this to surface detailed location data and analyze it based on background layers with more contextual information. Additional parameter settings are claimed to provide improved visual interactivity in the new release. There are also improved tools for making dashboards, as well as innovations in Ask Data, Tableau’s natural language processing (NLP) technology. The vendor is detecting a growing demand for location data.

Analyses without interruption

According to a recent analyst report, 30 percent of all customer interaction in 2022 will be driven by real-time location analyses. In 2017, this was only 4 percent. Tableau’s new vector maps offer detailed information and smoother exploration possibilities than mapping solutions that use images. When users zoom in or out or pan, the software automatically adjusts the size of the map, and it doesn’t have to load images, so that users don’t experience any disruption in their analysis flow.

Practical examples

Mapbox’s new map layers with background information provide more context for geo-spatial data, like labels for metro and train stations, square footage of buildings, ground, and water companies. PATH, a worldwide health organization, monitors reports of diseases like malaria using Tableau and Mapbox. This allows them to more easily and accurately track areas with strong outbreaks. There is also a new function called “parameter actions”. This enables users to adjust the parameters that inform the calculations, analysis functions, and reference lines. The only thing users have to do is select data points in a visualization. A complete overview of the functions available in Tableau 2019.2 can be found on Tableau’s website.

From riches to rags

Finally, the high-profile failures mentioned at the start of this blog. Not everything touched turns to gold in Silicon Valley, as the financial and organizational difficulties MapR and Cloudera are facing can attest to.

Billion-dollar unicorn has to close up shop

In its heyday, the Santa Clara-based MapR was valued at over a billion dollars. The so-called unicorn became an Apache Hadoop specialist, but is now having to close its doors, unless it can find a buyer. Despite the massive hype, Hadoop didn’t take off. According to Gartner, in 2017 only 14 percent of businesses used the slow and complex open source software. The CEO, along with 122 employees, was fired. From riches to rags, indeed.

Hyped merger fails to deliver

Cloudera, “the enterprise data cloud company”, is also seeing an exodus. The CEO has been replaced, and the recent merger with rival company Hortonworks hasn’t delivered the desired results. The financial results are disappointing, to say the least. On top of that, the existing customers of the merging partners are delaying investments as a result of the current uncertainty, and the lack of a joint roadmap. Competition from public cloud vendors is also hurting Cloudera.

Bad news for end users

Whatever way you look at it, this is all bad news for customers and end users who entered into a partnership with these promising companies in good faith. The moral of the story: do your homework and try, as best you can, to get a clear image of the roadmap, USP, management quality, reviews, user experience, and so on. And last, but not least: don’t believe the hype.

More information

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