EMC's announcement this week of plans to purchase data warehousing vendor Greenplum represents a harbinger of things to come for that market, as well as related areas like BI (business intelligence) and data integration, according to some analysts.
"I see the data warehousing space consolidating this year and next year," said Forrester Research analyst James Kobielus. "The pureplays that have established themselves, have customers, and look like they're innovating, those guys are going to be snatched up."
Multiple factors will drive this acquisition spree. For example, it makes sense for EMC to buy Greenplum because it is already selling "tons of storage into data warehousing deployments everywhere," Kobielus said.
But there's a broader trend at work as well, sparked by Oracle's recent shift toward selling integrated systems with the acquisition of Sun Microsystems, as well as its own entry into the data-warehousing appliance wars, Exadata. "You could see the EMC acquisition of Greenplum being in that same spirit."
Other hardware companies, such as Hewlett-Packard, may be pressured to make similar moves of their own.
HP already has the Neoview data warehousing platform, but it has not seemed to gain much traction since its initial launch a few years ago, according to Kobielus. It's therefore likely HP will make some purchases to "kick-start" its data warehousing play, he said. Another observer largely echoed Kobielus.
The Greenplum deal "was about a specific approach to data warehousing - complex analytics across large, often unstructured data, in a virtualised, flexibly provisioned environment," said analyst Merv Adrian of IT Market Strategy, via email. But "every data warehousing player has gaps they can fill. And companies in non-data warehousing spaces may want to come in. EMC was a great example."
Cisco and Dell, to name two, could follow suit, Kobielus said.
Meanwhile, the heat may be on for some of the many smaller data warehousing vendors in the market.
Simply offering faster and cheaper products won't be enough to survive independently in coming years against the larger players, Kobielus said. "To what extent can these data-warehousing appliance vendors build extensive partner ecosystems to team with for customized solutions? That's really the next stage."
Getting acquired is a likely outcome for most of those vendors, suggested analyst Curt Monash of Monash Research.
Companies like Netezza and Aster Data Systems, which have good market momentum and the ability to raise more capital, "all have good reasons for surviving, but even most successful companies eventually get bought," he said.
Other start-ups that have had a tougher time, such as Kickfire, nonetheless have intriguing technologies that could make them acquisition targets as well, he said.
But Monash is not buying predictions of widespread attempts at soup-to-nuts consolidation in the data warehousing and analytics arena.
"I don't think very many vendors can or want to compete on a full-stack basis with Oracle, Microsoft, IBM or SAP," he said. Moreover, "it is much, much easier to develop a great specialized technology than a great general-purpose one, and that often outweighs the advantages of the economies of scale and the potential integration of a full technology stack."