What a difference a year makes. The 2011 top 50 Information Management companies posted significant revenue growth in their latest reporting year, with gains posted by nine of the top 10 vendor/providers. Compare that to last year’s listing when none of the top 10, save Google, posted increases.
The IM 50 is a ranking of the top revenue-producing product vendors in information management – those that supply the tools and services used by organizations to collect, distribute, analyze and report on data.
“It’s a post-recession market. Mostly everybody is starting to see bounce back. This has been a pretty decent growth period for all the major vendors,” says Michael Fauscette, IDC group vice president, software busi-ness solutions.
In fact, only seven of the IM 50 posted revenue declines in this most recent ranking. Last year, more than half suffered declines.
“[The vendors] have benefited from pent up demand as companies bought things that had already been approved,” says Fauscette.
The majority of the top 10 generated double-digit growth, including EMC, Google and Oracle. The long-term performance of Oracle especially impressed analysts, who pointed to a decade of acquisitions that included Siebel, for analytics, and Hyperion, which added performance management.
For a quick-hit slide show of highlights from the IM50 list, click here.
These and several other acquisitions buffered Oracle’s expertise in transactional and database software. “If I already was a business ERP customer,” says Forrester Research analyst and vice president Boris Evelson, “built on the strength of that offering I would have very little reason to look elsewhere in business intelligence. A lot of my clients are asking about them.”Adds Fauscette: “Oracle is in a good position. It has a broad product portfolio that [encompasses] several trends, including cloud and CRM products.”
None of the top firms appear ready to rest on their recent performances. The biggest name on the list, Hewlett-Packard, posted $126 billion in 2010 revenues. A few months after announcing a new strategy for the company, HP dumped Leo Apotheker as CEO in favor of former eBay chief Meg Whitman. HP has decided to spin off or sell off its personal computer and handheld device product lines and focus instead on information management software and services.
As part of a plan to acquire new assets for business information services, HP bought Vertica Systems, a real-time database and analytics platform company. “It’s an interesting offering,” says Evelson, “ – a [type of] columnar technology, which is increasingly popular” in the operational or near real-time analytic settings businesses want to mine.
The company spent another $10 billion to acquire Autonomy Corp., which Apotheker intended as a bookend of the database world of Vertica with document and email management, workflow and search.
But HP took a blow in 2010 when it dropped Neoview, its data warehousing platform due to competition from companies like Teradata [No. 18 on this year’s list] “HP just couldn’t steal enough customers from them,” Evelson says.
For most companies in the IM 50, mobile and cloud technologies beckoned as a new wave of computing, storage and software opportunity. But those without clear-cut strategies needed to adjust swiftly.
“SAP, although it has come back decently [from a maturing application portfolio], seems to having a challenging situation around cloud,” says IDC’s Fauscette. “Its midmarket application has been shaky.” The analyst says other hosted platforms such as CRM service provider NetSuite (No. 46, with $193.15 in annual revenue) feel they have made better inroads than SAP with cloud customers and prospects.
Fauscette is also negative on near term prospects for Microsoft, which he says is struggling on several different fronts, including cloud and mobile. Microsoft’s partnership with Nokia also looks rocky since Nokia will not be delivering any handsets until the end of the year, he says.
Salesforce.com, which came in at No. 20 with $1.66 billion in revenues, is broadening it offerings and stands out as an ongoing success story.
“Salesforce has gone through a metamorphosis. They came in as a [CRM] application vendor and evolved into a tech platform provider,” says David Menninger, vice president and research director at Ventana Research.
Menninger isn’t sure whether the success of Salesforce was according to plan, but says that it was “a nimble evolution.”
“It’s riding its technology wave of cloud-based software delivery application and doing it adeptly,” he explains. “It used some of its money to tackle bigger challenges. It applied cloud to databases with Database.com, and it created [cloud application network] Force.com.” The company has also found a successful social media service with Chatter.com, a popular and growing mechanism for collaboration among CRM customers.
Further down the IM 50, listed at No. 38, Pegasystems, with $336.60 million in revenue, has managed to boost its presence as business process management gained traction.
“[Pegasystems] sort of got stuck in a plateau about five years ago. Maybe BPM was a little ahead of the market and Pegasystems was a victim of that,” Menninger says. But enhanced electronic communications among companies and improvements in automated processes mean Pegasystems has become more timely and relevant to customers trying to reduce costs related to business processes.
Toward the bottom of the list analysts see a good handful of companies – S1 Corp., Aspen Technology and Actuate Corp. among them – that are struggling for relevance in the marketplace.
Aspen Technology turned out to be one of the worst performers on the IM 50. It posted revenues of $166.34 million, down a heady 46.6 percent from its previous 12-month tally.
Aspen focuses on managing data and processes for discrete (hard goods) manufacturers and process manufacturing (who blend materials into products). “They’re vested in the supply chain and, because of that, they’ve been decimated by the economic environment,” says Ventana’s Menninger.
Shoring up the bottom of the IM 50 is Actuate Corp., which posted $131.47 million in revenues. While it posted decent profits in its past 12 months, Evelson’s Forrester perceives the company as the victim of its own business plan – not unlike Menninger’s take on Aspen.
“Actuate isn’t growing, [and it’s hard to grow] with a niche offering, which in this case is BI reporting,” Evelson explains. “If I can get a full suite [of services from other providers], why do I need to go to a company that only does reporting? Some clients think it’s easier and one can argue their functionality is richer, but few and fewer are thinking that way.”
The IM 50 is a ranking of the largest North American information management companies by revenue and profit.
The IM 50 is meant to provide a snapshot of the largest participants in information management and is not a precise comparison. Our editors compared and selected the companies we felt were most engaged with and relevant to our readership and coverage areas. Any definition of what constitutes an information management company is subjective due to the diversification of the industry and the financial reporting that is available. Many large diversified companies do not break out revenues by product revenues and were ranked by total corporate revenue. This skews the results compared to focused software/hardware vendors and those without large service revenues. Five companies marked with an asterisk on the list are privately held, and we worked from revenue numbers they provided. The one nondomestic vendor we included in the list is SAP, due to its large U.S. operations. We also excluded domestic and foreign-based consulting/system integration service firms.Information was retrieved from company websites where possible and generated from financial websites where necessary. For this report, we used companies’ chosen fiscal year reporting periods so not all results conform to the 2010 calendar.The IM 50 is meant to provide a snapshot of the largest participants in information management and is not a precise comparison. Our editors compared and selected the companies we felt were most engaged with and relevant to our readership and coverage areas. Any definition of what constitutes an information management company is subjective due to the diversification of the industry and the financial reporting that is available.
Many large diversified companies do not break out revenues by product revenues and were ranked by total corporate revenue. This skews the results compared to focused software/hardware vendors and those without large service revenues.
Five companies marked with an asterisk on the list are privately held, and we worked from revenue numbers they provided. The one nondomestic vendor we included in the list is SAP, due to its large U.S. operations. We also excluded domestic and foreign-based consulting/system integration service firms.
Information was retrieved from company websites where possible and generated from financial websites where necessary. For this report, we used companies’ chosen fiscal year reporting periods so not all results conform to the 2010 calendar.
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