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November 25, 2010

Open source BI firms refute SAS CEO’s criticism

Vendors line up to defend open source business model. But what's their evidence?

By Jason Stamper

Boxing gloves open source fight

The gloves are off. Pic: KWdesigns on Flickr, CC licence.

Open source business intelligence and data integration firms Actuate, Jaspersoft, Pentaho and Talend have angrily refuted SAS Institute CEO Dr Jim Goodnight’s assertion that he, "Hasn’t noticed [open source BI] a lot," and that, "most of our companies need industrial strength software that has been tested, put through every possible scenario or failure to make sure everything works correctly."

The founder and CEO of SAS Institute – the largest privately owned software company in the world – made his comments in an interview with CBR last month.

Yves de Montcheuil, VP of marketing at French data integration firm Talend, which competes with SAS Data Integration, told CBR Goodnight’s comments are, "PR bullshit. One of the specific advantages of open source is that we have a wide community who help us test the software and add improvements."

Talend recently announced a $34m funding round and the acquisition of German enterprise service bus player Sopera, saying the move puts it in the top five open source software vendors.

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Pete Cittadini, CEO of open source business intelligence player Actuate, said of Goodnight’s comments: "He never sees it because he never leaves his own campus! SAS is big and successful, but they don’t want to give credit where it’s due because they are in denial: Goodnight, [Oracle’s] Ellison, [IBM’s] Palmisano – they’re all the same."

Actuate, which claims to have over 4,600 customers around the world, recently changed its stock market ticker from ACTU to BIRT, in recognition of the fact that the firm is behind the open source Eclipse project, BIRT. It also announced there have now been 10 million downloads of BIRT, that there are over a million BIRT developers around the world, and that Actuate has generated $55m in BIRT-related revenue in the last four years.

Meanwhile Jaspersoft’s CEO Brian Gentile told CBR he believes SAS’ Goodnight is underestimating the threat that open source poses: "He faces possibly SAS’ biggest threat yet from the [open source] R programming language and tools," Gentile said. "He faces the ‘Innovator’s Dilemma’: namely that the incumbents are the last to understand the reason for new competitors. He truthfully doesn’t see it. If I was in his shoes I probably wouldn’t see it either."

Gentile said that open source BI technologies are coming from the bottom up, while tools like those from SAS are used by experts and so come from the top down. "Competition always comes from the bottom," he said. "With open source new use cases are being driven by users, who can innovate without baggage from the incumbents. Look at it was users who pulled into organisations, not senior managers."

"I hope [Goodnight], IBM Cognos, SAP BusinessObjects stay right where they are, ignoring companies like Jaspersoft," Gentile added.

Jaspersoft claims it has had 12 million downloads of its software, and 175,000 of those have registered with Jaspersoft. It claims its software is in use at over 13,000 commercial companies, and around 1,000 of them are paying customers. Gentile says the firm has grown at over 60% in each of the last three years.

Pentaho’s Vinay Joosery, EMEA VP, accused the co-founder and CEO of SAS of, "Denying a market reality," and argued that Goodnight’s claims that commercial software gets more rigorous testing than open source is wide of the mark.

"BI customers are not in denial about the sheer practical benefits of open source," said Joosery. "Because the software gets exposed to large communities it matures faster and is tested outside of the labs, in the real world, every day."

In a report by Gartner’s Andreas Bitterer at the start of the year, the analyst made it clear that open source business intelligence products are no longer solely the choice of price-conscious, small firms or as a departmental stop-gap: open source BI has hit the mainstream, he said.

Bitterer said that open source BI is on the radar of the larger, incumbent suppliers, such as IBM Cognos, SAP BusinessObjects, Oracle and SAS Institute: "As you might imagine, the increasing open-source traction has not gone unnoticed by the commercial vendors," Bitterer said. "While often dismissed as being no competition, even the large established BI vendors have come up with counter measures to address the challenges from the lower-cost competitors."

But speaking to CBR, BI firm Information Builders’ CEO and founder Gerald Cohen backed up Goodnight’s arguments, saying, "MySQL had 11 million downloads but did it put Oracle out of business? No. There will always be small, open source vendors. They’re not going away. But it’s not a big business. A lot of companies will simply not build crucial systems on open source. I have low cost open source offerings when I need them. But it’s not going to become big business."

Cohen noted that Information Builders’ RStat predictive analytics technology is based on the open source ‘R’ programming language, while it also uses the open source Lucene for search. "I’m commercialising open source too, I just don’t feel the need to call myself an open source vendor because my BI suite is much broader than theirs," said Cohen.

Cohen also argued that many companies still feel concerned about using open source in their organisations: "We have to itemise every place where we have used open source for some of our clients, because they are scared somebody has used a patented technology in their open source code, and suddenly everyone gets sued."

Gartner’s Bitterer said in his report that the adoption of open-source business intelligence software is doubling every year, albeit from a relatively small base.

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