information strategy

In his article Analytic Databases Power BI Boom, James Kobielus notes that analytic databases have been largely ignored in the BI industry merger spree of the past few years. He predicts that analytic database vendors will develop or partner to offer BI appliances with built-in analytic applications, and that these BI appliances will be particularly attractive to mid-market customers. I think he’s right - DW vendors will need to do something to differentiate.

This begs the question, though, if it’s the applications that mid-market customers will buy, why will they care what database is powering the application, and doesn’t this still sound a lot like plumbing? Furthermore, if database vendors or partners begin offering DW SaaS, customers should not need to know or care what powers the service. Isn’t that one of the main ideas behind SOA?

So, I say, let the best BI apps win. I think that BI applications or SaaS are most likely to succeed where the data sources are themselves packaged suites or SaaS. That’s because, having built my share of successful business intelligence systems, I can confirm that it’s the “gezintgas and gezoutgas” (inputs and outputs) where the lion’s share of the development and maintenance cost is consumed. Only when the sources and uses of the data are reasonably standardized, can we get enough repeatability.

Not to say that more granular SaaS can’t work. In Persistent Storage for Amazon EC2, Werner Vogel from my alma mater, Amazon.com, announced that beta EC2 customers can stand up raw storage in sizes ranging from 1 GB to 1 TB. EC2 also provides the capability to copy a snapshot of the data into their S3 distributed store. It would be interesting to see how this would work for building OLAP cubes or other specialized analytic data structures using these capabilities.

So database vendors may try to differentiate by building analytic appliances, but if cloud computing services like EC2 keep advancing, cloud computing may eventually give traditional vendors a run for their money.

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