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What’s behind the latest wave of acquisitions in Analytics?

By Steve Cavolick

This past spring saw SalesForce.com acquire data visualization company Tableau for almost $16 billion. This was after Google Cloud acquired Looker, and embedded analytics provider LogiAnalytics acquired ZoomData, a platform particularly strong in visualizing real-time big data.

There has not been this much consolidation in the data visualization space in over 10 years. From 2005-2008, IBM acquired Cognos, SAP purchased Business Objects, Microsoft bought ProClarity, and Oracle picked up Siebel and Hyperion.

In some ways, the first round of acquisitions drove this one. When the technology giants bought BI platform companies 10 years ago, many customers of the acquired companies noticed a decline in customer service, problems executing integrations and product roadmaps, and the incursion of big-company culture into the smaller firms. Smaller companies are always easier to deal with than giant enterprise companies.

Simultaneously, digital transformation was in its infancy but gaining momentum, and lines of business did not want to deal with monolithic IT departments that were slow to deliver data and the tools to analyze it. The vacuum of independent BI companies was quickly filled by companies like Tableau, Qlik, and others who stressed speed, simplicity, and self-service. In a nod to the maturity of self-service analytics, many of those are now part of tech giants.

Focusing on the largest purchase, the Tableau acquisition makes sense because there is massive overlap of customers who use both SalesForce and Tableau. On the negative side, integration plans of the two products will confuse the market because SalesForce is all cloud, while Tableau is an on-premise desktop tool. I expect competitors in the data visualizaton space to sew seeds of uncertainty and doubt about what the future could be for those organizations that only use Tableau.

What’s next in the analytics space? Self-service visualization of data is a mature market and I believe that this latest round of consolidation will allow the next generation of analytics companies to step up and become disruptive, much like Tableau and Looker were 10 years ago. The analytics market has matured to the point where the fastest growing demand is for AI and ML tools. AI is still early in the hype cycle but digital transformation and inserting intelligence into every decision and process makes it top of mind for C-Level executives.

Analytics firms that bring Artificial Intelligence and Machine Learning to the masses are the next wave of tools that will capture market and mindshare. They may also be acquisition targets of larger technology companies when the next round of analytics consolidation occurs.

The LRS Big Data and Analytics team has over 20 years of experience in statistics, information management, predictive analytics and AI, and data warehousing. If you are interested in understanding how we can help you find value in your data with advanced analytics, please fill out the form below to request a meeting.

About the author

Steve Cavolick is a Senior Solution Architect with LRS IT Solutions. With over 20 years of experience in enterprise business analytics and information management, Steve is 100% focused on helping customers find value in their data to drive better business outcomes. Using technologies from best-of-breed vendors, he has created solutions for the retail, telco, manufacturing, distribution, financial services, gaming, and insurance industries.