BI top of Aussie CIOs' priority lists

BI top of Aussie CIOs' priority lists

Correct implementation vital for success in other areas

For the third year in a row, business intelligence (BI) applications have been ranked the top technology priority in the 2008 Gartner Executive Programs survey of 1500 chief information officers (CIOs). According to Gartner, this is because CIOs know they must implement a BI strategy properly if they want to accomplish many other priorities, such as customer service improvement and legacy application modernisation.

Revenue for BI software vendors in Australia is expected to hit $A184 million in 2008 and climb to $A251.5 million in 2011, with a five-year compound annual growth rate (CAGR) of 12.4 per cent. The overall growth rate forecast for the Asia/Pacific region over the same period is 15.5 per cent. Greenfield opportunities, together with fast economic and structural developments, are fuelling higher double-digit growth in other Asia/Pacific countries. However, worldwide growth rates are slowing, and will move into single-digits beyond $US7 billion by 2011, with a five-year compound annual growth rate (CAGR) of 8.6 per cent.

"The days of strong double-digit growth in the global BI market are over, as the industry enters a state of flux following vendor consolidation, increasing maturity, and price erosion," said Bhavish Sood, a senior research analyst for Gartner. "However, BI remains critical for businesses as it turns information into an asset for insight and decision-making, especially in high-growth markets in Asia."

The acquisitions by Oracle (Hyperion), SAP (Business Objects, still pending) and IBM (Cognos, still pending) in 2007 were disrupters for the market, which, if they are finalised, will eliminate all larger publicly-traded BI companies. Overall, more than two-thirds of the current BI market is now attributed to the mega-vendors. The remaining BI powerhouse vendors SAS, Microstrategy, Information Builders, and more so, smaller BI vendors, such as Arcplan, Panorama, or Qliktech, will need to increase market push to stay visible above the increased noise from the big four.

According to Gartner, value to users can also increase as a result of mergers and acquisitions in the market. "Consolidation activities by SAP, Oracle, IBM, and Microsoft should help accelerate the value derived from BI," Sood said. "Large vendors will drive increased usage, while new BI vendors will emerge introducing innovative technology and products to demonstrate differentiation and fill the gaps in the mega-vendors product lines."

Len Rust is publisher of The Rust Report

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