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The Influence Of Open Source On Mainstream BI

by Lyndsay Wise, President, WiseAnalyticsTuesday, September 28, 2010

The business intelligence (BI) market is constantly evolving due to advancements in technology and the maturity of general BI use.  As both businesses and software providers are able to enhance the way they interact with and design solutions, the ability to demand more from features, functions and interactivity becomes a big driver to continual software and related process improvements.  In addition, due to changes in the general market landscape with additions of niche players, Software as a Service (SaaS), and open source BI, organizations are demanding general changes to the structure related to the services associated with these solutions.

Although there are many influences on the BI market at any given time, open source BI’s penetration into the market and the overall model of open source have become influential to the general BI landscape. This influence has created changes related to the overall market in conjunction with other factors such as SaaS, agile BI, mid-market targeted offerings and the like.  This article looks only at open source and how the gaining popularity of open source solutions have affected the broader BI market, with a focus on:

  • Pricing models
  • Free solution offerings
  • Developer and end-user flexibility
  • Online community and quick development cycles

Pricing model expansion

One of the main reasons that traditional BI solutions have had difficulty penetrating potential customers outside of the enterprise market is because of the perceived exorbitant pricing and licensing fees of implementing and maintaining a BI solution. With market expansion and the advent of subscription fees, these barriers to entry no longer exist.  Not only has the popularity of subscription-based licensing affected the flexibility in relation to how solution providers develop their license models, it has changed the overall price expectations of many organizations.  Now companies feel they no longer have to allocate large amounts of budget up front and can pay equal installments over time.  Add to this the concept of free, and businesses looking at BI feel they should have access to high-quality, low-cost solutions.

Some of these perceptions have slowly led to multi-tiered pricing based on company size or business problem, flexibility related to licensing options and the ability to choose based on company preference as opposed to vendor model (and a try-before-you-buy approach to marketing).  Overall, the increase in choice means that more companies can take advantage of BI without having to limit their adoption to one or two business areas.  Increased licensing and pricing flexibility means that BI no longer falls into the realm of large deployments with high maintenance requirements.

Free solution availability

The key advantage of open source is the fact that it is free.  This gives open source BI a general benefit over competitors because as long as developers are available to customize solutions, they can forego software costs.  Even though in reality, there is no such thing as free due to the costs associated with development and maintenance, the reality is that there is a perception that free BI exists when the cost of software is excluded from the overall software development and maintenance process.   Consequently, once open source BI started to become a mainstream option for companies, other solution providers started offering free trials or limited free availability of their solutions. With the onset of commercial open source and consumer-oriented solutions, the free offerings provided by other vendors are not very different from the perspectives of end users.

As open source BI continues to take hold and actually replace some traditional BI implementations, the availability of free versions of software will increase.  With strong competition within the BI market coming from a wide variety of solution providers and types of solutions offered, larger players will move towards covering all of their bases by their ability to compete with the multiple types of offerings within the market place.

Developer and consumer flexibility

Developers have been drawn to open source solutions because of design flexibility and the way in which solutions can be customized.  With commercial open source, solution providers are transitioning this concept towards consumer-facing solutions as well.  This expansion of interactivity and overall design flexibility from both developer and end-user interfaces changes the role of BI within the organization from one of pushing a button and getting answers towards being able to interact with analytics in a way that enhances overall daily processes.  This trend towards high levels of interaction and customization irrespective of company role creates the perception of BI as a business enabler, thereby increasing its value to the organization as a whole.

Online communities, increasing collaboration, and quick development cycles

Open source has always prided itself on strong collaboration.  Individual developers or organized groups work on projects, enhance others’ work, help with communal support requirements, etc.  The ways in which online developer communities interact is endless.   Aside from the creation of an environment with a focus on continual improvement, the availability of many peers looking at and providing feedback in relation to multiple projects allows bugs to be fixed more quickly and for improvements to be added within quicker development cycles.  With so many hands working on enhancing what currently exists, solution developers are required to keep pace with what their communities are doing.  This in turn creates solutions that are being upgraded and released at a quicker rate than traditional BI counterparts.

Putting it all together

The BI market is broad enough to meet the business needs of any type of organization looking for a way to enhance their information visibility and make better decisions through the consolidation of their data.  Within a dynamic software environment, many factors play a part in overall market landscape changes.  The role of open source within the BI market has created a dynamic set of changes that include more flexibility, lower price points and a more collaborative approach to analytics in general.  With the increasing popularity of open source BI, its continued reach within the industry at large will provide additional positive additions that include continued focus on interactive user interfaces, flexible deployment options and many others that are difficult to anticipate in advance.  Overall, the positive effects of open source BI on the traditional BI landscape have enabled a broadening of access to BI for companies that may not look at traditional BI as a realistic option.

About the Author

Lyndsay Wise is an industry analyst for business intelligence. For over seven years, she has assisted clients in business systems analysis, software selection and implementation of enterprise applications. Lyndsay is the channel expert for BI for the Mid-Market at B-eye-Network and conducts research of leading technologies, products and vendors in business intelligence, marketing performance management, master data management, and unstructured data. She can be reached at lwise@wiseanalytics.com. And please visit Lyndsay's blog at myblog.wiseanalytics.com.

(Copyright 2010 - Dashboard Insight - All rights reserved.)

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