Tuesday, November 29, 2005

The shrinking band of ETL players

Informatica has had a couple of good quarters and is about the last independent ETL player left standing, now that Ascential has disappeared into the IBM Websphere maw. The only other players out there now are the quirky Ab Initio in the high volume niche, but hamstrung by surreal business practices (customers must sign an NDA even to get a demo) and, er, well that's about it. Sunopsis has taken a smart approach by using the capabilities within the database engines, but who else is left? Sagent had the last rites read before being bought by Group 1, while early pioneer ETI extract seems to have shrunk almost to oblivion, at least in terms of market presence. The trouble is that the features that ETL tools provided are increasingly being built into the underlying database engines, as Microsoft has with DTS (which it is about to revamp substantially in SQL Server 2005). This makes it harder for companies to justify a high price tag for more functional tools. Informatica has correctly abandoned its mad strategy of "analytics" and has broadened into EAI, where there is a larger market. Even this market is pretty competitive though, with Tibco battling it out with IBM Websphere, and with third-placed Web Methods actually shrinking in revenue in 2004. The remaining ETL vendors can be comforted by the fact that a lot of companies still "do it yourself", and so there are plenty of opportunities still for sales since the market is a long way from being saturated. However the pricing pressure that the "free" offerings in the database engines puts on vendors make it a struggle to make a good living. This pressure will increase as these capabilities become more functional and scalable.


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