2. Data – structured, semi-structured and structured data (internally and externally derived)
3. Access & storage software/API’s – the ability to map/reduce unstructured data in order to drive trending, sentiment analysis, and sessionization
4. Analytics – diverse, real-time data summaries providing actionable insights
5. Professional services – big data strategy and roadmap and advisory services
Many of those providers are focusing on monetizing data that they currently own, as opposed to driving transformations of customer data, claiming that it is “the low hanging fruit.” In addition, many providers are eliminating the infrastructure and professional services pillars as target areas for initial big data commercialization efforts, believing that an ecosystem model will provide an optimum risk/reward approach to the marketplace.
Enter BDaaS as a solution
From my perspective, this is an erroneous analysis of the market opportunity. Why? Big Data as a Service (BDaaS) is quickly becoming one of the fastest growing elements of big data services, as providers such as NuoDB are now providing cloud-based big data services on a yearly subscription model. Enterprises such as AutoZone are using NuoBD to customize its global supply chain at the store level, reducing the chances that customers will leave without making a purchase.
The benefit to enterprises is that they can quickly deploy big data services without having to change a single line of code or incurring any unscheduled downtime by initializing the service. One of the key hurdles to big data deployment is the potential disruption to the production environment and the necessity to employ an army of consultants to conduct single-tier and multitier data base migrations from SQL to Hadoop or HDFS. The ability to reduce the complexity of the migrations significantly reduces the upfront costs and required timeline of deploying the service and dramatically increases the potential ROI and TCO of the service.
Many large enterprises (especially financial services entities) will continue to retain relational databases and utilize cloud or appliance approaches to speed up transaction processing. State Street CIO Christopher Perretta was recently quoted in the Wall Street Journal indicating that State Street would never consider moving to big data architectures in its production environment. Perretta stated, “It’s a lot of bookkeeping that you can’t screw up.” As such, a flexible BDaaS offering appears to represent the primary revenue opportunity for carriers in the near future, especially with many of their existing marquee customers.
Big data means big business for Professional Services
The Wall Street Journal article projected that big data revenue will double to $4 billion dollars by 2015. Interestingly enough, 42% of that projected revenue is professional services. That begs two questions. One, why would any carrier forego over 40% of an addressable market? The second is why would carriers forego the potential to create “trusted advisor” relationships with its most important customers?
The professional services revenue driver is the new wave of database and analytics innovation that is now reaching the marketplace. Whether it’s Basho Riak or Cassandra (a new Apache Open Source data base), consultants will be required to assist enterprises in deploying and optimizing these new technologies and the supporting analytics in the enterprise environment. Even if you discount the deployment of emerging database technologies to zero, it is clear that professional services will be required to analyze an enterprise’s critical business processes to identify potential areas where a carrier’s data can be monetized to support potential big data initiatives.
Innovation leads to opportunity
Given the history of technical innovation, it is clear (at least to me) that the current major players in big data risk losing market share to the new wave of database innovators. In my opinion, carriers (in partnership with innovative data base and analytic players) who also possess deep- level consulting skills in this arena are best positioned to capture market share. They have the dollars to invest in infrastructure and expertise, and the relationships to alleviate the fear, uncertainty, and doubt surrounding the optimum approach of consuming big data services.
While the infrastructure and professional services pillars of big data may not, by themselves, create a “Bad, Bad Leroy Brown” opportunity, it is my belief based on the current market data that an offering providing infrastructure and professional services can create a BDaaS opportunity for carriers.