Business Intelligence in the Cloud: Sorting Out the Terminology

Published: 30 July 2008

Colin White explains the technologies behind the various terms currently being used to describe hosted business intelligence solutions and provides an overview of the capabilities they provide.

Over the past few months, both mainstream and startup software vendors have been announcing a steady stream of hosted business intelligence (BI) solutions. The various terms used to describe these offerings are often confusing. Examples of terms here include on-demand BI, BI software-as-a-service (SaaS), and BI in the cloud. The objective of this article is to help reduce this confusion by explaining the technologies behind these terms and providing an overview of the capabilities they provide.

Let’s start by reviewing six different business intelligence product offerings announced in this area this year. [For simplicity, I will use the term hosted solution to describe all of the products involved in these announcements.]

• Panorama Software’s PowerApps provides a hosted and scalable analytical engine for managing OLAP cubes built from relational data. The first application to use this engine will be Panorama Analytics for Google Spreadsheets. PowerApps is currently in beta testing and will be made available by the end of 2008.
  
  
• Vertica Analytic Database for the Cloud is a hosted and scalable version of Vertica’s columnar relational database system. The underlying grid-based computing system supporting this solution is provided by Amazon’s Elastic Computer Cloud offering.
  
  
• Kognitio’s Data Warehousing as a Service (DaaS) is a hosted and scalable version of Kognitio’s relational database system.
  
  
• LucidEra offers several hosted BI analytical applications that work with Salesforce.com and other CRM offerings. LucidEra Lead Insight is a new solution that provides pre-built metrics focused on the quality and performance of marketing leads, and how effectively they are converting to opportunities and to closed business.
  
  
• Business Objects Business Intelligence OnDemand is a solution that provides a hosted version of the BusinessObjects XI BI tools product set. Other hosted solutions from Business Objects include: Crystalreports.com for sharing reports over the web, Information OnDemand for third-party market and financial data, and Business Applications OnDemand, a set of hosted applications (acquired from Nsite) for quote and proposal management.
  
  
• PivotLink (formerly SeaTab Software) provides a set of hosted analytical and reporting tools, together with pre-built industry specific metrics. PivotLink for Retail, for example, gives retailers metrics on highest-margin SKUs, inventory turns and stock levels, order status and store comparisons.

An examination of the websites for each of these six products shows the confusion caused by the many different terms used to describe hosted solutions. Here are some examples of the terms used by these vendors:

Panorama Software
… SaaS BI Solution
… analytics as a service platform
… cloud-based data warehouse and OLAP cubes

Vertica
… performance on demand
… analytic database for the cloud
… grid-enabled

Kognitio
… data warehousing as a service (DaaS)
… on-demand data warehousing
… hosted BI applications

LucidEra
… business visibility on demand
… on-demand business intelligence
… LucidEra SaaS

Business Objects
… hosted platform
… on-demand business intelligence
… software-as-a-service model

PivotLink
… intelligence on demand
… SaaS model
… subscription-based model

Three terms occur consistently on these web pages: software-as-a-service (SaaS), on demand and cloud computing. Also, there are terms that often go hand-in-hand with these three, including hosted, subscription based, platform and grid computing. Let’s see how Wikipedia defines these terms.

The Wikipedia entry for SaaS states, “Software as a service is a model of software deployment where an application is hosted as a service provided to customers across the Internet. Using SaaS can reduce the up-front expense of software purchases, through less costly, on-demand pricing. The SaaS software vendor may host the application on its own web server, or this function may be handled by a third-party application service provider (ASP).”

The terms to note here are hosted and on-demand pricing. SaaS solutions are hosted by the SaaS vendor, or a third-party. The pricing model is a pay-as-you-go approach based on usage.

Now let’s now examine the term on demand.

Wikipedia states, “On demand refers to a service or feature which addresses the user's need for instant gratification and immediacy of use. In most cases the value proposition for an on-demand service is wrapped up in the fact that the user or consumer of the service avoids a significant up-front financial investment and instead participates in a pay as you go plan.”

This reinforces the SaaS definition. On demand means you get instant access to a service as needed, and you pay based on usage.

The third term to consider is cloud computing.

The Wikipedia entry states, “Cloud computing refers to computing resources being accessed which are typically owned and operated by a third-party provider on a consolidated basis in data center locations. Consumers of cloud computing services purchase computing capacity on-demand and are not generally concerned with the underlying technologies used to achieve the increase in server capability. There are, however, increasing options for developers that allow for platform services in the cloud where developers do care about the underlying technology.”

The entry goes on to say, “Grid computing is a technology approach to managing a cloud. In effect, all clouds are managed by a grid but not all grids manage a cloud.”

Cloud computing then provides SaaS vendors with the computing services and power required to support customers. Like any other service, this computing power is on demand and charged for based on usage. To support the scalability required, cloud computing vendors use grid-based system hardware. Note the point made in the definition that the cloud computing provider may also provide additional platform services. We’ll define platform in a moment, but first we need to look at the term grid computing in more detail.

Wikipedia defines grid computing as “online computation or storage offered as a service supported by a pool of distributed computing resources, also known as utility computing, on-demand computing, or cloud computing. What distinguishes grid computing from typical cluster computing systems is that grids tend to be more loosely coupled, heterogeneous, and geographically dispersed.”

So a grid is a huge amount of scalable computing power made up of multiple systems that may, or may not, be in the same data center. Grid computers are used to provide the resources for cloud computing, which in turn supports SaaS computing needs.

The last piece in the puzzle is the term platform. Wikipedia states, “In computing, a platform describes some sort of hardware architecture or software framework (including application frameworks), that allows software to run.” A platform then is simply a bunch of hardware and software. In the software industry, the term platform is frequently associated with a set of integrated development tools. A BI platform, for example, is a set of integrated BI development tools.
 
Now that we have some definitions under our belt, let’s summarize them with respect to the terms used by the six vendor BI-related offerings discussed earlier.

• Software-as-a-service (SaaS): A software solution hosted by a vendor as a fee-based BI service.
  
  
• On demand: The ability for users to have instant access to a BI service and pay for it based on usage.
  
  
• Cloud computing: The computing capacity for supporting SaaS BI processing. This may be provided by the SaaS vendor, or a third-party.
  
  
• Hosted: An alternative approach to running a BI application in house. [Note that vendors often use the term on premise to describe in-house processing. This is incorrect English usage. The term instead should be on premises.]
  
  
• Subscription based: A business model for a pay-as-you-go BI service.
  
  
• Platform: A set of integrated BI software tools that may be offered as a SaaS or on-premises solution.
  
  
• Grid computing: A large virtual computing platform that provides scalable cloud computing for on-demand SaaS BI processing.

It is obvious from this discussion why so many different terms are used to describe vendor solutions in this area. Is it possible to come up with a common approach to using these terms? It is certainly possible to introduce some consistency in the use terminology, as the figure from BEA Software (now owned by Oracle) below shows.

I will try to do the same for the BI market (see Figure 2).

 

Figure 2: A Possible Terminology Scheme for Business Intelligence

In a hosted environment, web-based business and IT users access a set of remote business intelligence services. The term BI as a service (BaaS) could be used to describe this, but BI SaaS also works well.

The services accessed by business users are typically BI applications. BI application as a service (BI AaaS) could be used to describe this type of service, but AaaS doesn’t really work as a acronym, and so on-demand BI applications, or simply on-demand BI works better.

Supporting on-demand business intelligence is a set of platform services for IT users. Examples include BI development tools, data warehousing integration tools, analytical database processing, security services and so on. The group term platform as service (PaaS) works well here to describe these solutions. A data warehousing service would then be referred to data warehousing (DW) PaaS, or simply as a DW PaaS. Of course, data warehousing as service (DaaS) has a better marketing ring to it.

Lastly, on-demand BI and PaaS require a hosted computing platform. Here the term cloud computing works fine.

Of course, vendors and industry pundits will continue to use a variety of different terms to describe these various solutions. BI in the cloud, for example, is nice and succinct! Hopefully, however, this article has put this terminology into perspective.