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Open source BI software gains traction with manufacturers

Open source BI software offers manufacturers lower costs, ease of integration and reduced dependency on a single vendor. The caveat, however, is that lower cost does not equate to free. Open source BI still requires consulting.

As open source technology continues to gain traction as a mainstream IT solution, manufacturers are starting to consider open source business intelligence (BI) software as yet another cost-effective alternative to traditional BI applications.

Like Software as a Service (SaaS) BI, the primary lure of open source BI software is its potential for quick deployment without a significant upfront investment in software licenses and consulting services. Unlike traditional proprietary software, which usually carries a hefty licensing fee that can run into six figures, the open source software model generally refers to software developed in a public, collaborative manner, where source code is readily available and is often offered for free.

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Most vendors of open source BI software offer such free community versions of their tools in addition to enterprise versions, which provide deeper functionality and higher levels of vendor support. Nevertheless, deployments of open source BI can run into the tens of thousands of dollars, depending on the number of users and auxiliary consulting services purchased.

Compared to SaaS BI, open source BI has the added appeal of reducing reliance on a single vendor, and as a technology stack, it can offer greater flexibility for integration with other core enterprise systems, said Mark Madsen, president of Third Nature, a consultancy that focuses on data warehouse and BI technology. And since an open source BI application is hosted in-house, the concerns over data security that have impeded the adoption of SaaS BI aren't there.

Open source BI adoption gains traction

The adoption rate of open source BI is growing. When Third Nature recently surveyed 200 IT professionals, more than a third of them said they were already running open source reporting, data integration or database software for analytic purposes. Another 33% of the respondents said they were evaluating or considering open source options. Only 8% reported no interest in using open source BI.

Lower purchase and deployment costs topped the list of benefits cited by survey respondents (81%). Avoiding vendor technology lock-in and using open source to offset the string of acquisitions that have marked the traditional BI software market ranked second at 63%. Respondents also touted ease of integration/open standards (53%), flexibility in deployment (44%) and access to source code (37%) as benefits of the open source model.

"Open source is finally finding some traction in BI," said Claudia Imhoff, president and founder of Intelligent Solutions, which also provides consulting services around data warehouses and BI. "[Open source] isn't just a weird, little academic thing any more. The level of functionality and support for tools has finally reached a critical tipping point where they're fully baked and competitive."

Today, companies like Pentaho Corp. and Jaspersoft, in addition to The Business Intelligence and Reporting Tools Initiative (BIRT), a collaboration between BI vendor Actuate and the Eclipse Foundation, offer the full complement of BI functionality, including full data warehouse capabilities and reporting, dashboards, OLAP and data visualization technologies. There are even more specialized open source BI tools such as Talend Open Studio, an open source data integration software product that offers Extract, Transform and Load (ETL) capabilities.

Collective development and collaboration through open source BI

Open source BI products still don't have the same level of monitoring and management features of traditional BI software. They also require more manual configuration and their GUIs are less user-friendly. In addition, although the open source community provides ad hoc support, companies eyeing open source BI as an enterprise platform cite concerns about the availability of vendor-initiated and third-party support, training and consulting resources needed to back their deployments.

Open source BI vendors maintain that these fears are unwarranted. For instance, in addition to their community open source projects, Jaspersoft and Pentaho both have commercialized, licensed editions of their tools that are [backed by] warranties and service-level agreements and offer professional consulting services that can be contracted for a fee.

Potential adopters of open source BI should consider the technology as a model for software development and distribution, not as a mode of deployment, said Nick Halsey, vice president of marketing and management for Jaspersoft. "What we do is collectively and collaboratively develop new software, and a peer review is the best way to produce the best technology," he said. "We have thousands of people testing our code, working with us to make it better."

The discipline of BI also plays to the strengths of open source. For instance, for any company to benefit from a BI initiative, the tools need to be widely distributed among a user base -- a scenario that open source promotes. "You want to enable large communities of users and make it easy to collaborate and share information and reports," Halsey said. "Open source lends itself to that."

Open source BI capabilities grow through online collaboration

An open source model can also jumpstart a manufacturer's BI initiative by allowing the firm to test-drive the technology and experiment with data sources and analytic applications prior to making a full-fledged investment in software and commitment to a particular platform. All vendors of open source BI tools sponsor community projects that allow would-be adopters to download free code, interact with community and test drive the applications to see if it suits their needs.

This community aspect of open source offers a more important benefit to companies, particularly smaller manufacturers lacking in IT resources. While open source vendors don't necessarily have modules that address all the niche applications around BI, participants in their communities regularly contribute code and new capabilities that would otherwise be out of reach for smaller manufacturers.

"For users, that means they have access to the same features you can get in SAP or Oracle around BI and reporting," said Madsen. The model, he noted, is also a springboard for integrating vertical market BI applications.

Still, open source BI is not for every company. Experts say that manufacturers considering open source BI should have a culture that's predisposed to the open source model of software development. With traditional licensed software, the vendor is solely responsible for evolving the technology. With open source, the user company relies on community-driven development and needs to be prepared to be a more hands-on with troubleshooting, training and leveraging community resources for software support.

Lance Walter, senior vice president of marketing for Pentaho, said that companies considering open source BI also need to be comfortable with a lower-touch sales process. Open source vendors don't have the budgets for salespeople to wine and dine a prospective customer or even handhold them through the evaluation process, like an Oracle or SAP. Prospective open source BI customers are also on their own when it comes to doing the legwork and research to determine what product will work best for them.

Most importantly, Walter tells potential customers not to expect open source BI to be a free ride. If a customer wants the enterprise editions -- the versions that are certified and packaged more like traditional enterprise applications -- they are going to have to pay for licenses and invest in consulting services. "Don't go into this thinking it's free even though it's lower cost. It still takes investment to deploy [it]," he said, noting that open source BI is still pretty complicated.

About the author: Beth Stackpole is a freelance writer who has covered manufacturing techniques and manufacturing technology extensively.

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