Since a spate of mergers and acquisitions in 2019, the enterprise intelligence market has seen additional consolidation between tech giants and smaller gamers providing BI options. From Google’s acquisition of Looker to Salesforce’s acquisition of Tableau, there’s a clear pattern of huge tech giants going after smaller firms with extraordinarily distinctive BI choices. Even in 2022, the {industry} noticed firms like ‘Citrix’, an {industry} big in their very own proper, get acquired by ‘TIBCO’, a pre-dotcom increase BI mainstay.
Whereas the tempo of M&A has decreased over the previous few years, the route that the {industry} is heading in is obvious to see. BI leaders wish to consolidate their place available in the market by buying firms whose merchandise act as a worth add for his or her present providers. By doing so, BI giants want to create a siloing impact, the place they provide all BI providers potential underneath the solar however lock of their prospects into utilizing solely their merchandise in the long term. Does this sentiment signify the way forward for enterprise BI?
Scripting success by means of consolidation
One solely wants to have a look at Google’s BI technique to see this in impact. Over the course of the 2010s, Google constructed some fundamental instruments like Huge Question, Information Studio, and Snowflake, which provided a level of BI performance. In addition they employed Thomas Kurian, now the CEO of Google Cloud, to ramp up their scaling efforts within the cloud BI area. To this finish, they acquired Alooma in 2019, a BI firm that centered on combining knowledge sources into cloud providers. This marked a renewed concentrate on their cloud BI enterprise.
These strikes had been capped off by GCP’s acquisition of Looker, which boasted options like an all-cloud structure and ‘LookML’, an AI-powered semantic layer. This acquisition marked the creation of an entire stack for enterprise BI on GCP, and got here together with Looker’s devoted consumer base, giving a lift to Google’s nascent BI technique. At present, Google believes they’ve cracked the code to enterprise intelligence, with Google’s Gerrit Kazmaier, Vice President & Basic Supervisor for Database, Information Analytics & Looker saying,
“At Google, I feel we now have cracked that code to the way you get belief and confidence of information with the pliability and agility of self-service.”
Many firms within the BI area wish to replicate this success story utilizing related methods. Qlik has been on an acquisition spree since 2019, beginning with ‘Crunch Information’ options and occurring to accumulate ‘Attunity’, an information-availability software program options firm. The corporate later acquired ‘RoxAI’, an organization centered on constructing AI-driven clever alerting programs, together with ‘Knarr’, a data-exploration agency. They continued buying different firms similar to ‘Blendr.io’, an embedded integration platform for SaaS; ‘NodeGraph’, a visualisation service supplier; and ‘Huge Squid’, a platform which brings predictive analytics to BI.
As seen with Google’s technique, this collective bunch of applied sciences do provide a comparatively full-featured BI tech stack. When mixed with Qlik’s industry-leading knowledge analytics platform and cloud presence, the one piece left on the puzzle was a strong knowledge integration resolution. Their upcoming merger with Talend is clearly geared toward filling the hole of their stack of BI choices. One other notable instance is ‘TIBCO’ which has acquired a complete of 9 firms within the final 5 years alone.
What’s the way forward for BI?
Whereas it’s simple to boost the alarm when wanting on the pattern of A&M in BI, plainly this pattern is slowly tapering off. In 2019, one of many largest years for the {industry}, 26 firms had been acquired. Whereas this middling pattern continued in 2020 (23 firms acquired), 2021 noticed a increase in acquisitions with over 40 firms bought by {industry} leaders. Nonetheless, solely 19 firms had been acquired final 12 months, regardless of the {industry} hitting an all-time excessive valuation of $27.24 billion.
This may signify a fatigue in acquisitions as firms attempt to undertake new applied sciences into their choices. Alternatively, this may also be seen as a slowdown in consolidation makes an attempt as {industry} leaders look to extend their market share. There’s additionally a chance that the widespread acquisitional perspective within the BI {industry} additionally encourages innovation from smaller firms within the hopes that their product will get acquired by a BI chief.
Information is rapidly changing into one of many largest differentiators for firms, which signifies that BI firms must both innovate or purchase to remain related. Nonetheless, there’s one huge roadblock relating to market consolidation on this particular {industry}; knowledge integration. When aggressively buying firms, {industry} leaders have extra incentive to make it tough for a corporation to maneuver their knowledge from one BI supplier to a different.
That is generally seen in applied sciences like Microsoft Energy BI and Google BigQuery, which have well-documented points with working collectively. When prolonged to a whole {industry}, these issues develop exponentially. Additional acquisitions will solely solidify every firm’s tech stack, stifling competitors and destroying the choice of alternative for purchasers. BI leaders may also be inspired into this behaviour by their opponents and prospects alike, as prospects would require interoperability between all providers provided to them whereas opponents will solely attempt to additional their very own market place. Nonetheless, hope remains to be on the horizon as firms may recognise that permitting interoperability is best for the {industry} as an entire, permitting discrete options to unravel distinctive challenges for BI customers.
