Deloitte Makes Its Bid for Analytic Prominence
Is this the beginning of a BI SaaS acquisition frenzy?
- By Stephen Swoyer
- May 25, 2011
Professional services giant Deloitte has snapped up seminal software-as-a-service (SaaS) player Oco Inc. for an undisclosed sum.
Deloitte's move isn't isolated. Last June, for example, Deloitte arch-rival Accenture plc acquired customer data analytics specialist CadenceQuest Inc.
Accenture recently elbowed its way into analytics, introducing its Accenture Analytics Subscription Environment (AASE), a hosted analytics service that (among other pieces) has a SaaS analytics component.
More intriguing still, Oco cites Accenture as a "Featured Partner" on its corporate Web site. Deloitte and Oco do not have a similar relationship, so Deloitte's move both gives it a creditable SaaS BI analytics offering and undercuts one of its biggest symmetrical competitors.
It also gives Deloitte a chit with which to parry the efforts of two of its other largest competitors -- Hewlett-Packard Co. (HP) and IBM Corp., both of which have moved aggressively (and more visibly) into analytics, too.
In tandem with its acquisition of Oco, Deloitte unveiled a new analytics practice, the cleverly-christened Deloitte Analytics Tactical Advantage (DATA).
Deloitte's analytic effort is spearheaded by data management veteran (and Deloitte Partner) Jane Griffin, who's been attached to its information management practice for almost seven years. Griffin is now consulting global leader for Deloitte Analytics. Although Deloitte did not immediately respond to a request for comment at press time, it did provide a statement, attributed to Griffin.
"This acquisition enhances our ability to help further an organization's existing business analytics and data management strategy," she said. "We can help businesses realize faster time-to-value through more immediate access to critical business data from disparate sources."
Industry veteran and TDWI contributor Mike Schiff, who is familiar with the IT consulting side of Deloitte's business, thinks the acquisition is both a savvy and an essential move. "It sends the message that they're serious about analytics, while at the same time giving [Deloitte] best-of-breed capabilities. It also potentially cuts off a resource from one of their competitors," he says, noting that Deloitte's acquisition overture appears to have come out of nowhere.
"I don't know what kind of relationship [Deloitte has] with Oco, but they aren't listed as a 'Featured Partner' on [Oco's] Web site. Accenture is," he points out.
Schiff sees the acquisition as an essential move because it helps Deloitte ratchet up its analytic signature, especially relative to competitors HP and IBM.
That being said, neither Oco nor Accenture is saying much about the significance of their existing partnership. Although Oco's corporate Web site does list Accenture as a "Featured Partner," Accenture's doesn't return the favor: Oco doesn't appear in its list of technology alliances, nor, for that matter, does a search of Accenture's corporate Web site yield any Oco-related collateral.
Accenture did not respond to a request for comment at press time, but Schiff suspects that it was probably aware of Deloitte's acquisition overture, and that, moreover, Oco probably gave it an opportunity to counter Deloitte's bid.
"You can assume that that was done," he comments, adding that -- quite aside from competitive fractiousness -- most existing Oco customers won't be affected by the deal. "I suspect the people who are currently using it won't be affected. Although I suspect that starting next week, you're not going to see Accenture bidding it [Oco] out to new or prospective customers," he points out.
The acquisition sidelines (or, at the very least, recasts) another prominent SaaS BI player. Almost two years ago, SaaS BI pioneer LucidEra announced that it was ceasing operations, the victim of a brutal economic climate. There's currently no shortage of SaaS BI players, however: in addition to prominent SaaS entries such as Birst Inc. and Pivotlink Corp., Good Data Corp., Litebi, RapidMetrix Inc., and Visual Mining Inc., at least a dozen start-ups tout some kind of SaaS BI.
Schiff expects that one or more of these vendors will be acquired at some point over the next 24 months. "This is really nothing new in the industry. These guys [large services firms] are all pushing into analytics. I think you'll definitely see additional acquisitions [of this kind]," he concludes.
Undercutting the Promise of SaaS BI?
Mark Madsen, a principal with consultancy Third Nature, thinks the acquisition is intriguing for another reason. "It's an interesting marriage, given that the selling point of SaaS BI was how easy it is to set up, [i.e., that it needs] no consulting," he told BI This Week. Strictly speaking, says Madsen, this might be true, "but if you need to do integration, change any data, [or anything else], it can be a lot harder."
That being said, he suggests, SaaS BI vendors such as Oco and IT consulting specialists such as Deloitte are speaking to the same audience. "SaaS BI is supposed to be an end-user and business-side sale, right where consultants are. Maybe these are [the] reasons why? After the initial sale, [Deloitte can] go in and sell a broader set of vertical BI services?"
More likely, says Madsen, is the Platform Pitch. "Maybe they wanted a platform they owned that could be hosted, since the move -- in theory -- is away from on-premise software."
Oco gives Deloitte a kind of vertical orientation with BI, which makes for an "easy" consulting value-add, he explains. "[Deloitte could] capture their vertical BI expertise into a set of configurable software, [such that they would not be] beholden to a BI vendor [to make] general-purpose reporting tools. As a business, vertically oriented BI – i.e., applications and dashboards -- is more interesting than a DIY data warehouse project. Never mind that someone still has to get the data in. It will be Deloitte rather than IT."