Worldwide Business Analytics Software Market Shares, 2014: Line of Business Drives Cloud and Visual Discovery Adoption

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1 MARKET SHARE Worldwide Business Analytics Software Market Shares, 2014: Line of Business Drives Cloud and Visual Discovery Adoption Dan Vesset David Schubmehl Alys Woodward Brian McDonough Carl W. Olofson Stewart Bond IDC MARKET SHARE FIGURE FIGURE 1 Worldwide Business Analytics Software 2014 Share Snapshot Note: 2014 Share (%), Growth (%), and Revenue ($M) Source: IDC, 2015 August 2015, IDC #258146

2 EXECUTIVE SUMMARY The business analytics software market represents a collection of software markets that functionally address all the steps in the life cycle of decision support and decision automation processes. Various market participants may refer to these processes as business intelligence, business analytics, analytics, big data, and so forth. IDC's definition views business analytics as the overarching market, with big data technology as a specific set of business analytics software that can address very large, fast-moving, and diverse data sets. For a more detailed definition of IDC's big data technology market, see IDC's Worldwide Big Data Taxonomy, 2015 (IDC #254052, March 2015). In 2014, the overall business analytics software market grew less than expected. We attribute much of the shortfall in the U.S. dollar based assessment of the market to exchange rate fluctuations (for a discussion of the impact of exchange rates, see IDC's Forecast Scenario Assumptions for the ICT Markets and Historical Market Values and Exchange Rates, Version 2, 2015, IDC #256665, June 2015). Another factor that declined the market growth rate in 2014 was the continued shift in the revenue recognition model due to growth in cloud business analytics solutions. The three primary business analytics software market segments, described in detail in the Market Definition section, are as follows: Performance management and analytic applications Business intelligence and analytics tools Analytic information management platform These three segments represent a relatively even share of the overall market in Of the overall market in 2014, performance management and analytic applications accounted for 33%, business intelligence and analytics tools share was 36%, and analytic information management platform share was 31%. The Americas represents 54% of the market, while the EMEA and APJ regions account for 34% and 12% of the market, respectively. This IDC study presents the historical view of the worldwide business analytics software market from 2012 to The study includes a breakdown of the overall market by 12 subsegments, a discussion of key market developments, and guidance to vendors. "The business analytics software market grew 6.5% in 2014 to reach just over $40 billion worldwide. Vendors offering cloud analytics and visual discovery tools outpaced the market," said Dan Vesset, program vice president for IDC's Business Analytics and Big Data. ADVICE FOR TECHNOLOGY SUPPLIERS Vendors in the business analytics software market include large IT providers, start-ups, and specialty or niche product providers. The forecast growth rates within each of the segments of the broader market appear in Worldwide Business Analytics Software Forecast, (IDC #257402, July 2015). Vendors looking to compete effectively in the business analytics software market should consider the following: 2015 IDC #

3 Recognize the range of use cases and deliver fit-for-purpose technology. While there remain many distinct segments of end users, such as data scientists, business analysts, operational employees, and managers (and several subsegments within each of those segments), there is also growing evidence of blended roles. For example, several vendors are in the process of delivering software that would allow business analysts to take advantage of predictive analytics without the need to become experts in math, statistics, or computer science. Respond to demand for self-service data access and analysis. Self-service in the context of business analytics is not only visual discovery within the query, reporting, and analysis segment of the market, but it also has to reach back to self-service data acquisition and preparation. Enable operationalization of analytics by ensuring results of analysis reach the appropriate operational systems and employees. Analytics is not an end in itself but rather a step in the process of decision making and execution. Business analytics software vendors need to ensure that their technology can be efficiently connected to the various operational decision execution points within the organization. Consider the emerging big data and analytics information management architecture that is expected to expand from the commonly used relational data warehouse to several other technologies. The information management platform is becoming more expansive with growing deployments of Hadoop clusters and a range of nonrelational and nonschematic databases. The rest of the business analytics software stack has to accommodate this information management platform expansion. MARKET SHARE The business analytics market is mature and market shares remain stable among the leaders. Vendors offering highly visual self-service analytics continued to see strong growth. Table 1 provides vendor shares and growth rates for vendors with more than $100 million in 2014 revenue. Table 2 illustrates the overall business analytics software market by segment for TABLE 1 Worldwide Business Analytics Software Revenue by Vendor, ($M) Vendor Oracle 6, , , SAP 5, , , IBM 4, , , Microsoft 2, , , SAS 2, , , Teradata 1, , , Salesforce.com Informatica IDC #

4 TABLE 1 Worldwide Business Analytics Software Revenue by Vendor, ($M) Vendor Adobe Qlik MicroStrategy Infor Tableau Software FICO Esri TIBCO Information Builders JDA Software Autodesk Epicor Software Palantir NA Webtrends Aspen Technology HP Panorama Software Dassault Systèmes SunGard Pitney Bowes Hexagon Other 7, , , Total 35, , , Note: This table does not take into account any mergers and acquisitions that closed after December 31, IDC #

5 TABLE 2 Worldwide Business Analytics Software Revenue by Segment, ($M) Business intelligence and analytics tools Advanced and predictive analytics 2, , ,422.9 Query, reporting, and analysis 8, , ,079.0 Spatial information analytics Content analytics and cognitive software platform ,129.5 Subtotal 12, , ,504.9 Analytic information management platform Data warehouse generation 2, , ,907.9 Data warehouse management 8, , ,493.2 Subtotal 11, , ,401.1 Performance management and analytic applications CRM analytic applications 3, , ,822.6 Financial performance and strategy management 3, , ,567.2 Supply chain analytic applications 1, , ,222.6 Production planning applications 1, , ,557.9 Services operation analytics 1, , ,706.6 Workforce analytic applications Subtotal 11, , ,357.8 Total 35, , ,263.8 Additional Market Segment Shares Tables 3 9 show vendor revenue, shares, and growth rates for market segments not published in other IDC documents. For other market segments, see specific documents referenced in the Related Research section IDC #

6 Data Warehouse Generation Software Table 3 illustrates the share and growth rate for data warehouse generation software market. TABLE 3 Worldwide Data Warehouse Generation Software Revenue by Vendor, ($M) SAS Informatica IBM Microsoft SAP Other Total 2, , , Data Warehouse Management Software Table 4 illustrates the share and growth rate for data warehouse management software market IDC #

7 TABLE 4 Worldwide Data Warehouse Management Software Revenue by Vendor, ($M) Oracle 3, , , Microsoft 1, , , IBM 1, , , Teradata 1, , , SAP Other Total 8, , , Services Operations Analytic Applications Table 5 illustrates the share and growth rate for the services operations analytic applications software market. TABLE 5 Worldwide Services Operations Analytic Applications Revenue by Vendor, ($M) FICO SAS IBM SunGard Fiserv Other Total 1, , , IDC #

8 Supply Chain Analytic Applications Table 6 illustrates the share and growth rate for the supply chain analytic applications software market. TABLE 6 Worldwide Supply Chain Analytic Applications Revenue by Vendor, ($M) SAP Oracle JDA Software Infor Aspen Technology Other Total 1, , , Workforce Analytic Applications Table 7 illustrates the share and growth rate for the workforce analytic applications software market. TABLE 7 Worldwide Workforce Analytic Applications Revenue by Vendor, ($M) SAP Oracle IBM Kronos ADP Other Total IDC #

9 Production Planning Applications Table 8 illustrates the share and growth rate for the production planning applications software market. TABLE 8 Worldwide Production Planning Applications Revenue by Vendor, ($M) SAP Oracle Dassault Systèmes Infor Schneider Electric Other Total 1, , , Spatial Information Analytics Tools Table 9 illustrates the share and growth rate for the spatial information analytics tools software market. TABLE 9 Worldwide Spatial Information Analytics Tools Software Revenue by Vendor, ($M) Esri Autodesk Hexagon Oracle Pitney Bowes Other Total IDC #

10 Exclusions Vendor shares of additional market segments are published in various subject-specific IDC studies listed in the Related Research section of this study. This study excludes continuous, real-time analytics software. IDC is in the process of adding this market segment to the business analytics software market. This study excludes a segmentation of the analytic information management platform market segment into relational data warehousing and nonschematic data management software. IDC is in the process of adding this segmentation to the business analytics software market. This study excludes the IT operations analytics software, which is separately addressed in Worldwide IT Operations Analytics Software Forecast (IDC #252790, December 2014). This study excludes cognitive software platform software. IDC is in the process of adding this market segment to the business analytics software market. WHO SHAPED THE YEAR Microsoft with its Power BI offering and salesforce.com with the introduction of its Analytics Cloud affected the year in significant ways. Both of these query, reporting, and analysis tools still lag behind the top 3 business analytics vendors' offerings in terms of revenue, but given the reach Microsoft and salesforce.com have in the market, their offerings have significant potential to disrupt long-standing vendor rankings. Overall, market leaders continued to hold their positions through their offerings of broad suites of business analytics functionality. In general, smaller vendors with cloud offerings and visual discovery tools outpaced the market. However, all large vendors have also entered the cloud market with a range of database, business intelligence, analytics, and analytic applications products. Some of these were developed internally, while others were acquired. Vendors in the visual discovery segment of the market, including Tableau Software and Qlik, outperformed the market. Vendors continue to gain share as their offerings have appealed to line-ofbusiness employees increasingly involved in the purchase decision of these tools. For established vendors to make gains with their own competitive offerings, they need to improve perceptions among business users as capable providers of visual, intuitive, and accessible self-service analytic tools. Rapid growth was exhibited by cloud-only FPSM vendors Host Analytics and Adaptive Insights. The market is ready for budgeting and planning in the cloud, and the characteristics of the process are similar to other successful cloud offerings in other markets. These characteristics include a highly distributed process requiring asynchronous collaboration among a wide range of employees. Furthermore, the process is not critical to organizational success nor a competitive differentiator, so allocating IT resources to manage and maintain the process comes at the expense of using those resources on more critical functions. Other FPSM modules are expected to do well in the cloud as well, including offerings that manage the consolidation and close process IDC #

11 MARKET CONTEXT The business analytics software market incorporates a wide range of functionality across the technology stack from data acquisition to information delivery. Within each market segment, there are specific trends and competitive developments. These trends are discussed in a number of IDC studies, some of which are listed in the Related Research section. The sections that follow address the most significant accelerators and inhibitors of the overall business analytics software market. Growth Accelerators Availability of data. Digitization of everything and the increase in the number of data producers are driving greater demand in data capture, management, and analysis software. IoT, consumer behavior tracking, and risk management requirements are some of the biggest factors contributing to this market accelerator. These factors will have an especially strong influence on solutions that can provide real-time actionable intelligence. Demand for self-service. The need for on-demand access to the freshest data with easy-touse tools or applications and a need for associated data integration and management tools continue unabated. These requirements are driving purchasing for a range of tools that help ensure self-service functionality to support the full business analytics workflow. Demand for predictability. Organizations across industries are seeking predictability across all fronts. Predictability affects cash management, service delivery, process re-reorganization, and other aspects of running a business. Growth in subscription pricing models is one manifestation of this trend; another is the demand for a range of applications with predictive functionality. These include applications across any business function, from asset maintenance and process optimization to customer interaction and risk management. Growth Inhibitors Transition from on-premises to cloud deployments. Adoption of cloud (SaaS)-based business analytics solutions will accelerate, and cloud-only vendors and the cloud-based products of other vendors are expected to continue to grow faster than on-premises equivalent options. Because of the change in the revenue recognition model that accompanies the shift from onpremises to cloud deployments, we expect this trend to have a negative effect on revenuebased growth of the market over the next three to four years. Open source technology options. Open source business analytics solutions, from data integration and management software to advanced analytics and reporting tools, will continue to be broadly adopted. We expect open source components to represent the core of many major business analytics solutions. Revenue-based assessment of market growth will be inhibited because of this trend as open source options continue to push down prices of business analytics solutions. This trend is also likely to accelerate transition from on-premises to differentiated cloud solutions that compete on added value above the functionality of core components. Rise of automation and cognitive computing. Increased automation across the analytics process life cycle (from data acquisition to decision making) and systems based on deep learning will start to replace some of the existing analytic applications and business intelligence and analytics tools. This trend may have a downward effect on the total software revenue because the new generation of solutions will not require the same number of user- or seat-based licenses for the so-called power users IDC #

12 Significant Market Developments Some of the significant market developments in the broader business analytics software market are: Cloud-based delivery of business analytics software will continue to accelerate and 2015 represent a turning point in the availability of cloud business analytics as several large vendors have introduced new offerings. (Note that IDC plans to publish a separate study with a segmentation of the market based on cloud and on-premises deployments.) Self-service visual discovery software will continue to grow faster than other segments of the business intelligence market over the forecast period. However, the longer-term prospects of this market will be inhibited by the rise in cognitive computing, which will automate many of the data manipulation and analysis tasks currently performed by business analysts or managers (for more details, see Worldwide Query, Reporting, and Analysis Software Forecast, , IDC #256761, June 2015). Solutions-based cognitive computing have begun to be adopted across industries. After decades of false starts by purveyors of artificial intelligence technology, the technology is finally ready to hit mainstream. Mass adoption will still take time as go-to-market, pricing, and packaged strategies evolve and as the level of automation continues to increase for projects that today still require substantial "manual" custom consulting effort (for more information, see Worldwide Content Analytics, Discovery, and Cognitive Systems Software Forecast, , IDC #256774, June 2015). The data warehousing market based on relational databases will continue to be disrupted by several nonrelational and/or nonschematic information management software categories. Data warehouses will not disappear as they have a key place in an organization's data architecture. However, they will see lower growth as workloads will shift to other fit-for-purpose technologies. The data integration process will become more complex. Data integration and data quality are the perennial top 2 challenges in IDC surveys of end users. The proliferation of data sources and data types in on- and off-premises locations is introducing new challenges. Demand for data integration software and all its subsegments will remain strong (for more information, see Worldwide Data Integration and Access Software Forecast, , IDC #256768, June 2015). The content analytics software market, which had been dominated by text analytics, is rapidly expanding into audio, video, and image analytics. Applications of rich media analytics have been already deployed across industries. We expect this market subsegment to experience rapid growth. The advanced and predictive analytics (APA) software market will evolve to incorporate features and functionality for business analysts not only data scientists. This trend has already started but will require substantial changes to existing APA software to accommodate new user interfaces and workflow management, collaboration, and automation features. One of the key requirements for new APA solutions will be fast assembly and reassembly of analytic components to support uses such as short-duration microsegmentation (for more information, see Worldwide Advanced and Predictive Analytics Software Forecast, , IDC #256781, June 2015). IDC expects acquisition activity to pick up over the forecast period. There are still several IT vendors that claim to be in the business analytics or big data market but have limited software portfolios to back those claims. At the same time, there is a large number of start-ups introducing new solutions and midsize vendors that continue to outpace large IT vendors' business analytics revenue IDC #

13 METHODOLOGY The IDC software market sizing and forecasts are presented in terms of commercial software revenue. IDC uses the term commercial software to distinguish commercially available software from custom software. Commercial software is programs or codesets of any type commercially available through sale, lease, rental, or as a service. Commercial software revenue typically includes fees for initial and continued right-to-use commercial software licenses. These fees may include, as part of the license contract, access to product support and/or other services that are inseparable from the right-to-use license fee structure, or this support may be priced separately. Upgrades may be included in the continuing right of use or may be priced separately. All of these are counted by IDC as commercial software revenue. Commercial software revenue excludes service revenue derived from training, consulting, and systems integration that is separate (or unbundled) from the right-to-use license but does include the implicit value of software included in a service that offers software functionality by a different pricing scheme. It is the total commercial software revenue that is further allocated to markets, geographic areas, and operating environments. The worldwide software market includes all commercial software revenue across all functional markets or market aggregations. For further details, see IDC's Software Taxonomy, 2015 (IDC #256767, June 2015). In addition, please note the following: The information contained in this study was derived from IDC's Worldwide Semiannual Business Analytics Software Tracker database as of June 15, All numbers in this document may not be exact due to rounding. MARKET DEFINITION IDC defines the business analytics software market as an aggregation of several software tools and application markets, with the functionality to aggregate, manage, organize, analyze, access, and deliver structured and unstructured data. The business analytics software market has three primary segments: performance management and analytic applications, business intelligence and analytics tools, and analytic information management platform as shown in Figure 2. Each of the primary segments has subsegments as follows: Business intelligence and analytics tools. These software tools include query, reporting, and analysis tools; advanced analytics tools; spatial information analytics tools; and content analytics and cognitive computing platform tools. Analytic information management platform. IDC defines this segment of the market as consisting of relational, schema-based data warehousing and nonrelational, schemaless data repositories. This market segment also includes the data integration software that supports extraction, transformation, cleansing movement, loading, and governance of data from source systems to the aforementioned two types of target systems. Performance management and analytic applications. IDC defines these applications as software that must meet each of the following three conditions: 2015 IDC #

14 Business process support. Commercial application software that structures and automates a group of tasks pertaining to the review and optimization of business operations (i.e., control) or the discovery and development of new business (i.e., opportunity) Separation of function. Can function independently of an organization's core transactional applications, yet can be dependent on such applications for data and may send results back to these applications Time-oriented, integrated data from multiple sources. Extracts, transforms, and integrates data from multiple sources (internal or external to the business) supporting a time-based dimension for analysis of past and future trends or accesses such a database IDC tracks the following performance management and analytic applications subsegments: Customer relationship analytic applications. These applications support sales, marketing, customer services, and contact center functions. Supply chain analytic applications. These applications support logistics, inventory, manufacturing, asset management, and product development functions. Services operations analytic applications. These applications support operational functions within services-oriented industries, such as financial services, healthcare, education, and government. Workforce analytic applications. These applications support a range of human resources processes. In addition, IDC classifies two functional markets as being part of the performance management and analytic applications market. These markets are: Financial performance and strategy management applications. These applications support budgeting, financial planning, close, consolidation, and strategy management processes. Production planning. These applications automate activities related to the collaborative forecast and continuous optimization of manufacturing processes IDC #

15 FIGURE 2 IDC's Business Analytics Software Taxonomy, 2015 Source: IDC, 2015 Exclusions Vendor shares of additional market segments are published in various subject-specific IDC studies listed in the Related Research section of this study. This study excludes continuous, real-time analytics software. IDC is in the process of adding this market segment to the business analytics software market. This study excludes a segmentation of the analytic information management platform market segment into relational data warehousing and nonschematic data management software. IDC is in the process of adding this segmentation to the business analytics software market. This study excludes the IT operations analytics software, which is separately addressed in Worldwide IT Operations Analytics Software Forecast (IDC #252790, December 2014). This study excludes cognitive software platform software. IDC is in the process of adding this market segment to the business analytics software market. For more information on specific application segments of the business analytics software market, see IDC's Software Taxonomy 2015 (IDC #256767, June 2015) IDC #

16 RELATED RESEARCH Worldwide Business Analytics Software Forecast, (IDC #257402, July 2015) IDC's Forecast Scenario Assumptions for the ICT Markets and Historical Market Values and Exchange Rates, Version 2, 2015 (IDC #256665, June 2015) Worldwide Content Analytics, Discovery, and Cognitive Systems Software Market Shares, 2014: Content Analytics and AI Drive Growth (IDC #256823, June 2015) Worldwide Financial Performance and Strategy Management Applications Market Shares, 2014: Cloud Offerings Gain Share (IDC #256759, June 2015) Worldwide Query, Reporting, and Analysis Software Market Shares, 2014: Visual Discovery Vendors Make Gains (IDC #256811, June 2015) Worldwide Data Integration and Access Software Market Shares, 2014: Year of Affirmation of Data Integration on the 3rd Platform (IDC #256783, June 2015) Worldwide Business Analytics Software Forecast and 2013 Vendor Shares (IDC #249926, July 2014) Worldwide Database Management Systems Forecast and 2013 Vendor Shares (IDC #248952, June 2014) 2015 IDC #

17 About IDC International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications and consumer technology markets. IDC helps IT professionals, business executives, and the investment community make factbased decisions on technology purchases and business strategy. More than 1,100 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries worldwide. For 50 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. Global Headquarters 5 Speen Street Framingham, MA USA idc-insights-community.com Copyright Notice This IDC research document was published as part of an IDC continuous intelligence service, providing written research, analyst interactions, telebriefings, and conferences. Visit to learn more about IDC subscription and consulting services. To view a list of IDC offices worldwide, visit Please contact the IDC Hotline at , ext (or ) or sales@idc.com for information on applying the price of this document toward the purchase of an IDC service or for information on additional copies or Web rights. Copyright 2015 IDC. Reproduction is forbidden unless authorized. All rights reserved.