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Rapid Growth in OLAP Market Driven by Internet Solutions

FEBRUARY 1999

Web-based and thin-client architectures are quickly replacing traditional client-server applications in a number of software categories, and the market for enterprise OLAP solutions is no exception.

The market for Web-based OLAP, or online analytical processing, has picked up speed, with most of the established OLAP vendors and some faster-moving new players offering all manner of browser- and Java-based OLAP tools. The market's direction grew even more apparent in August, when Oracle--whose Express OLAP product leads the server market-released the first Web-enabled versions of its Financial Analyzer and Sales Analyzer OLAP client applications.

Before Web-based OLAP, most OLAP solutions were based on client-server architectures. Because of administrative demands, pricing plans that favored small deployments, and interfaces and feature sets targeting users with some degree of expertise, OLAP clients were typically available only to a small portion of a company's workers.

"Nobody can install 10,000 clients," said Bob Craig, vice president for application architectures at the Hurwitz Group.

In contrast, Web-based solutions are often built atop the browser and therefore require minimal client administration, and their pricing structure is also often more suitable to large deployments. Hyperion Solutions' Web Gateway, for instance, costs a flat $10,000, with no per-user charge. Web-based solutions make it feasible to deploy OLAP across an organization for the first time, Craig said.

As can be expected with a broadened user base, Web-based OLAP aims at a different kind of analysis than is targeted by traditional client-server tools. Some of the focus is shifting from tools-based data exploration by specialized analysts to pre-built analytic applications accessible to a broader range of workers, Craig said.

"More and more people are recognizing they can't just throw a tool out there," he said.

Nevertheless, that doesn't mean fat-client solutions are dead. Most OLAP vendors are continuing to ramp up their offerings in both traditional and Web-based markets.

"The thick client is still going to have value," said Don MacTavish, senior research analyst for application development at the Meta Group.

Dan Druker, vice president of marketing for Hyperion Solutions, said many customers are using Web solutions for mass information distribution, saving traditional high-powered tools for more sophisticated analysis. Hyperion, which The OLAP Report ranks as the revenue leader in the OLAP market, sells both kinds of solutions.

"This is all about choice," Druker said.

The rise of Web-based OLAP is also blurring the lines separating the OLAP market from related software categories. Web-based interactive reporting platforms, such as Sqribe Technologies' products, are becoming more and more similar in their feature sets to streamlined Web OLAP solutions. For the Meta Group's MacTavish, one of the most compelling Web-based analysis solutions comes not from an old-style OLAP vendor but from three-year-old AlphaBlox Corp., which sells a modular platform for creating Java-based analytic applications. AlphaBlox has promised support for Hyperion's Essbase OLAP server and said it is pursuing relationships with other OLAP vendors.

"OLAP is rapidly becoming the face of the data warehouse," MacTavish said. SQL-based query tools could grow obsolete, he said, adding that "Web-based deployments are going to dominate." In considering which vendors' solutions are most promising, MacTavish said that vision is more important than execution at this stage. In a rapidly developing market, he said, what is product today will be history tomorrow. In addition to AlphaBlox, MacTavish said he was impressed by Web OLAP offerings from InfoSpace, Hyperion, and Seagate Software, among others.

MacTavish said that although traditional OLAP vendors, such as Cognos, Business Objects, and Brio, are moving forward quickly with Web-based solutions, their offerings have not been the most exciting. He added, though, that Business Objects' WebIntelligence product has an impressive and promising architecture.

Teresa Wingfield, research director at Giga Information Group, was similarly impressed with Business Objects' architecture, and she also said MicroStrategy's Web-based solutions are leading the way.

Wingfield said that although Web-based solutions broaden the reach of OLAP, they also introduce new concerns. As the user base for data analysis applications grows and spreads to far-flung locations and roles, she said, an organization's understanding of where data comes from and what it means could degrade.

"What's really going to become of the data quality issues?" Wingfield asked.

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