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Issue Date: June 2007

MarketWatch: Tibco spots analytics opportunity

June 2007
Madan Sheina

Tibco's $195m acquisition of Spotfire marks the first merger of a business process management firm with a pure-play analytics company and could change the way that IT organisations relate business intelligence to middleware and realtime infrastructure.

Introducing Spotfire
Tibco is well known in business integration circles for its service-oriented architecture, realtime event processing, and BPM technologies.
Less well known is Spotfire, an analytics company that has flown beneath the radar of mainstream business intelligence and analytics for about a decade, providing specialised analytics for operations management.
Rather than competing directly with general-purpose BI tools from Business Objects and Cognos, Spotfire has focused on providing heavily on rich Internet (Ajax) analytic front-ends that are friendly to business analysts as opposed to developers. The company excels in data visualisation, offering a range of visual presentation methods and dashboards that run in a web browser or a Windows .NET client.
Compared to other data visualisation-centric BI companies, Spotfire has been a commercial success. It has built up a $40-$50m business currently growing at around a 25% annual rate with 800 customers worldwide, 60% of whom are now in North America.
Spotfire has carved out a strong niche in the pharmaceutical, semiconductor, oil and gas, and public sectors. Significantly, it is just starting to crack financial services, a strong market for Tibco.
Analytic opportunities
Building the predictive business
Tibco has articulated a vision for the 'predictive business' that blends its strength in realtime processing and business process management infrastructure with BI and analytics.
Spotfire is not the first move by Tibco to apply analytics to its event-processing and integration platform. Earlier this year, it announced the second release of BusinessEvents, its first foray into converging data integration and realtime analytics space.
BusinessEvents is a complex event-processing platform that captures, correlates, and filters business events and activities across the enterprise.
Spotfire's analytic technology plays directly into Tibco's predictive business vision, complementing Tibco's efforts to provide an event-driven infrastructure for realtime decision-making.
The main integration points are with Tibco's iProcess Suite, a BPM platform originally developed by Staffware, and BusinessEvents.
The goal is to deliver data in realtime to business users through Spotfire's analytic clients. However, it should be noted that Spotfire has a .NET client and Tibco is a Java-orientated company.
Nevertheless, Spotfire has plans to build a new Ajax-based browser client to offer a richer web front-end.
The benefits of applying analytics to process management are becoming well understood. Rules engines and workflow software can only squeeze out so much efficiency from process-management systems.
Analytics takes that process optimisation a step further by monitoring the relevance and performance of events and activities against operationally defined business metrics and thresholds to drive value-add decision making or trigger follow-on processes.
Branching out
There is also a commercial motivation to the acquisition as well.
It is no secret that Tibco has been looking to expand beyond its core information bus and complementary integration technologies for several years.
B7 Spotfire now gives Tibco's business another dimension: realtime, event-driven analytics for process improvement that will bolster its presence in the BPM market and help the company to compete against rivals' proprietary stacks.
B7 Tibco gains entry into new markets, such as high-tech manufacturing, and clinical trial analytics in the pharmaceutical and energy sectors. Spotfire has an impressive blue-chip customer base including Toshiba, Merck, Pfizer, and Chevron.
B7 Spotfire gains access to Tibco's numerous financial services and telecoms customers.
B7 Spotfire gets new resources under Tibco and the opportunity to expand its footprint in operational BI by taking advantage of deeper integration points (nearer to an event-driven service bus) that are beyond the reach of other BI software providers.
Tibco is retaining the Spotfire brand and running the company as a separate division. While the two companies' technologies are broadly compatible it will be interesting to see how Tibco's integration infrastructure-focused sales team markets and sells Spotfire's technology.
The convergence of BPM and analytics has been going on for some time, resulting in acquisitions and partnerships driven by both camps.
B7 Business Objects acquired NSite last year for its on-demand process management platform that creates web-based routing and approval workflows for business applications. Business Objects also struck a partnership with Tibco in 2005, but not much has been heard of the deal since then.
B7 IDS Scheer and IBM have incorporated high-end business process analysis capabilities into their respective ARIS and WebSphere Modeler BPM platforms.
Will BPM eventually absorb BI and analytics? It is too early to say. Certainly there is an increasing need to provide timely and accurate BI information to operational business users. BPM is part of the puzzle, allowing companies to establish effective processes across divisions and to streamline the flow of messaging and transactions. Analytics is perhaps the missing part.
The acquisition of Spotfire by Tibco brings a new perspective to both the BI and BPM market, bringing an analytics company under the wing of a leading SOA integration and BPM firm. The deal makes sense when you consider that a lot of business information is being generated by SOAs and fed into data warehouses and BI systems.
It also signals a serious foray by Tibco into a broader BI market that is rapidly converging with realtime event processing and BPM. The move will further differentiate Tibco's operationally focused BI value proposition of complex event-stream processing infrastructure and process-awareness for enabling realtime or right-time analytics. That is a capability most other traditional BI vendors lack.
Tibco will initially focus on synchronising analytics as a closed-loop system with its core BPM and event-stream offerings. The immediate opportunity is to target companies that have already deployed BI and analytic capabilities and are looking to put in a realtime process and event-management infrastructure. In the long term it will be interesting to see if Tibco decides to integrate analytics more deeply as a core part of its realtime information and message service bus.
Equally interesting will be response of traditional BI vendors like Business Objects and Cognos who have their eye on realtime capabilities.
Source: Computergram

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