What $18 Billion Means for the Future of BI
Last week, the BI landscape as we know it changed forever. Unless you’ve been living under a rock, you’ve probably heard about the recent Looker and Tableau acquisitions. The combined $18.3 billion investments made by cloud behemoths Google and Salesforce are—without a doubt—a sign that BI and analytics has gone mainstream as enterprises look to win a data-driven future.
But what does the road ahead look like for the industry, companies, and the cloud? We’ve got a few ideas.
‘Data-Driven’ is No Longer the Goal. It’s the Requirement.
We’ve long heard that organizations strive to be data-driven. But until now it’s been a competitive advantage. If these investments are any sign that times are changing, striving to meet that goal is no longer enough. So much so that Salesforce was willing to cough up close to $16 billion for the leading data visualization platform to compete with the likes of Microsoft. Salesforce is going head-to-head with the other big tech players, and they believe that data will lead every organization of the future. Companies that don’t make this a priority will suffer.
Google also sees the writing on the wall. By acquiring Looker, Google aims to create a cohesive data product and strategy to strengthen its Google Cloud Platform (GCP) offering, a product that has consistently lost to AWS and Azure. This move, combined with its purchase of Alooma, is an attempt to piece together a modern data stack for GCP customers. Another big bet that data dominance will win the tech wars.
Google and Salesforce Have Work to Do
These acquisitions—both by cloud leaders—make some sense, but they also raise serious questions. Why is the original “no software”, SaaS company buying a desktop software company? And why is Google, a company known for self-service products that require little hand-holding, buying Looker—a product that wasn’t built for the cloud and takes months to set up?
We’ve seen other big players make similar acquisitions and struggle to piece together a cohesive product strategy or penetrate new markets. Vendors like MapR, Hortonworks, and Cloudera have hit hard times after making the wrong investments at a time when companies are moving to a public, cloud-native world. Meanwhile, unsatisfied customers are fleeing over a lack of transparency and shifting product roadmaps.
History shows us that navigating these types of mergers can be challenging for customers and management alike, especially when integrating products that are so different from the core offering—which is very much the case of the Looker and Tableau acquisitions. Both are products built to run on-premises, and while they have some cloud services, neither is a true cloud product like Salesforce or GCP. This means significant work lies ahead for both companies as they build formidable cloud products that customers have come to expect.
The End of an Era. And the Birth of New Age.
These acquisitions are just the most recent consolidation cycle in a crowded, fragmented BI space. Like other major data companies a decade ago, such as Oracle and SAP (remember BusinessObjects and Hyperion?), Google and Salesforce are acquiring the current generation of data analytics products built before the cloud era. These solutions have done a good job opening up analytics to non-IT teams, but they’ve failed to drive BI adoption past 30% of employees despite more approachable end-user experiences.
The visual discovery tools that led this last wave of innovation (see: Tableau and Qlik) have moved into slower growth territory, never found profitability, and reached adoption plateaus as they began suffering innovator’s dilemma, leaving them ripe for acquisition.
This consolidation is setting the stage for the next data evolution as cloud-based analytics accelerates and the next set of BI innovators and leaders emerge. A staggering 41% of companies are considering a move to cloud-based analytics in the next year as they look to cut costs, improve efficiency, and enable better decision-making at every level of business. This isn’t surprising. Data has been moving to the cloud for years. But the last year has seen unprecedented investment and adoption.
With the death of the on-prem and hybrid era comes a new age: the cloud-native age. We’ve been calling these trends since our founding and we’re excited for what the future holds. We believe the next move will take BI to nearly 100% adoption. How? By building solutions that are simple, flexible, and collaborative. Solutions that bring BI to the customer, wherever they may be in their analytics journey. This means providing intuitive, yet powerful, user experiences, flexible pricing, and a single environment where SQL gurus and business experts can work together to answer the toughest questions.
Of companies are considering a move to cloud-based analytics in the next year.
The Future is Cloudy, But One Thing is Clear.
It’s hard to predict the future, but the cloud remains in focus for companies of all sizes. That’s why we’re on a mission to make cloud data accessible to everyone; something none of the existing BI and cloud companies have been able to deliver.
In the meantime, we continue to invest in a 100% cloud-native future where everyone can be a part of the data conversation. As companies push for total BI adoption, we only see one path ahead: visual exploration and modeling tools that break down the barriers to analytics so that every business expert can generate and share their own insights.