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Dell acquires StatSoft and the list of predictive platform vendors gets even shorter… by Simon Arkell, CEO, Predixion Software

Mar 25 2014

Yesterday it was announced that Dell acquired StatSoft, a 30+ year old business analytics software provider. Yes, you read that correctly. 30+ years old. That means that this innovative analytics company existed before the Internet, before mobile, before SaaS, before big data…

So, why would Dell acquire an old analytics company? It’s no secret that big data and advanced analytics is the hot market to be in right now. Clearly one motive for a hardware-laden company like Dell is to continue to buy recurring revenue streams and nice margins, both of which they get from StatSoft. However, there is more going on here just below the surface. StatSoft, though old and not entirely innovative, has what very few companies in the market today have: a predictive platform. And, software vendors with an actual platform for building and deploying predictive analytics are a rare breed indeed.

Everywhere you look there is an article about how predictive analytics (and its attached-at-the-hip cousin, prescriptive analytics) is transforming entire industries. GE jumped on its industrial internet initiative with the “GE Predix” platform and “Predictivity” offerings as a way to offer predictive outcomes to customers who purchase its trains, jet engines, gas turbines and aviation services. Predictive analytics, it turns out, is the only way to offer “zero down time” guarantees to customers by allowing them to anticipate potential failures, intervene with proactive maintenance and prevent future failures from happening.  Major consulting firms like Accenture are selling outcomes and software vendors are touting their wares as if they are curing cancer. Actually, cancer will most likely be cured with the assistance of technology like this. Technology that can analyze data and see patterns well before a human can. In fact, in the future, all software will have predictive components – in hospitals, on the tarmac, in the maintenance facility or in the oil field – to prevent failures and proliferate positive outcomes. 

The problem for the big technology mega-vendors is that the list of actual vendors who have a platform for the development and deployment of predictive models and applications is surprisingly short (hint: we’re one of them). There are tons of companies out there who espouse their superior predictive capabilities but there’s a dirty little secret. Most of them hard-wire an algorithm into a virtual black box and solve a specific problem for customers in a specific industry or process. Think marketing optimization, lead scoring, preventative maintenance, hospital readmissions and more. That is not very repeatable or scalable nor is it economical.

A platform company is one that has software on top of which predictive models will actually be built, shared, deployed and used. It’s one that can serve up multiple applications and can integrate with the ever growing list of algorithm libraries, big data stores, in memory streaming engines, and BI interfaces. It’s one that the mega-vendors must have in order to remain relevant. 

SAP didn’t have one. They said they did, but they really didn’t. When they realized it, they acquired our competitor KXEN. KXEN was a good company, albeit with older technology but at least it gave SAP some credibility. Now Dell has acquired Statsoft. They have a platform that allows statisticians to build a model, and I’m sure they have nice recurring maintenance streams that look good to the CFO. The problem is they are not a scale-out cloud service, they don’t cater to real human beings who will soon be interacting with predictive analytics without knowing it – but at least Dell has one. It’s better than being irrelevant… 

At Predixion, we are fortunate enough to have an innovative predictive platform and a user interface that is easy to use, so business analysts can build, share and deploy predictive models. In other words, you don’t have to be a data scientist (high demand + short supply) to build and deploy predictive models in your organization.

When I look at the remaining emerging predictive platform vendors like Predixion, Revolution, Alpine, and…I can’t think of any others…and compare that against the list of technology mega-vendors who don’t have a real predictive analytics platform, I realize that I’m playing a game that I’ve always wanted to play. The new world order is one where the disrupters come through on the other side with ownership of a market that previously didn’t exist. And it’s a big one. Bring it on!

Predict Everything.™


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