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Software // Information Management
Commentary
2/10/2005
11:41 AM
Ted Kemp
Ted Kemp
Commentary
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Fast And Furious

BI software firms are posting big sales gains, and indications from the user side are that 2005 will bring more of the same.

Not all the business intelligence software firms have tallied their final results for 2004, but enough have reported earnings to show that the BI market is heading into 2005 with a freight train-like momentum that shows no signs of slowing.

Sales at Business Objects hit $925.6 million last year -- a whopping 65 percent higher than sales in 2003. The company hopes to reach or top the $1 billion mark in 2005, helped by demand for a new flagship BI platform that fully integrates technology from Crystal Decisions.

Sales at SAS, the privately held business intelligence and analytics giant, reached $1.53 billion in 2004, up 15 percent. SAS pointed to healthy demand for its SAS 9 intelligence product, which has shipped to 20,000 new and existing customers, according to the company.

The story's similar at MicroStrategy, Hyperion and Informatica, among others. MicroStrategy chalked up 39 percent sales growth in the fourth quarter, crushing Wall Street's expectations. Hyperion's sales grew 13 percent year-over-year in its most recent quarter. Informatica reported a 7 percent revenue boost in the final period of 2004.

Signals are strong from the customer side as well. A Forrester Research survey of 1,368 technology decision makers in North America and Europe found they plan to boost IT spending 3.9 percent overall. Regulatory concerns and an increasing quantity of data kept business intelligence in the top spot in planned purchases, at 9%.

"Our inquiries on BI are coming in fast and furious," said Kurt Schlegel, business intelligence analyst at research firm the Meta Group. "There's definitely no slowdown in questions on BI. People are going to make some investments out there."

Anecdotally, at least, the readers of Business Intelligence Pipeline echo Schlegel's sentiment -- both for now and on the road ahead. Forty-three percent of respondents to our latest site poll said their organizations will spend "considerably" more on business intelligence this year than they did in 2004. Another 26 percent expect to spend "somewhat" more. Roughly a fifth said their spending will hold at about the same level as last year, while only 13 percent expect to spend less.

Schlegel singled out MicroStrategy and Business Objects as vendors showing more strength than he had anticipated in their most recent quarters, though healthy sales seem prevalent across the spectrum of BI software companies. "All these guys are showing growth right now," he said.

And all signs point to more of the same in '05.

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