Analyst Perspectives

Informatica reintroduced itself to the world at its recent customer conference, Informatica World, in San Francisco. The company took advantage of the event to showcase its new branding in an effort to change the way customers think about the company. Informatica has been providing information services in the cloud for more than a decade. Even though cloud revenue comprises a minority of Informatica’s business, in absolute terms, the revenue is significant, and company executives want the public to recognize Informatica as a leader in cloud-based data management services for enterprises. Presenters also made notable product announcements, discussed below, including the application of machine learning to the data management process.

Initially the cloud was only a small part of Informatica’s business. In 2012, the first year for which I could find publicly disclosed figures, cloud revenue was approximately $29 million, less than one-tenth of the license revenues for its on-premises products. But the company stuck with it and has since developed a substantial cloud-based business. It now reports processing more than 3 million data integration jobs per day in the cloud for more than 7,000 customers and generating more than $100 million in cloud-based revenue. To be clear, executives did not claim that the cloud-based business had eclipsed the on-premises business, but with these figures, Informatica can legitimately label itself a cloud-based data management vendor.

Informatica continues to offer on-premises services as well, and speakers acknowledged that most organizations will prefer hybrid cloud and on-premises capabilities. Our Data and Analytics in the Cloud benchmark research finds significant demand for hybrid capabilities. Nearly half (47%) of research participants reported integrating data from the cloud with on-premises systems and more than one-quarter (29%) reported integrating data from on-premises with cloud-based systems. To make it easier for on-premises customers to purchase and consume Informatica services, earlier this year the company converted all of its products to subscription-based pricing. This change will also make it easier to have a single licensing model for hybrid environments.

Informatica has created four clouds, one each for Integration, Master Data Management, Data Quality and Governance, and Data Security. Three of the four cloud services are available today. The company plans to make Master Data Management available in the fourth quarter of this year. Informatica also plans to introduce additional clouds in the future. The four clouds share a common user experience, metadata and microservices.

Microservice is a method of developing applications in small units of independent processes with well-defined interfaces. A microservice architecture provides several benefits. Informatica can be more agile in bringing new capabilities to market by modifying existing or creating new microservices without updating an entire product. Users can share these services across products, improving integration. Furthermore, a microservices architecture generally provides better scalability since individual services can be scaled as necessary based on workloads. The Informatica clouds also share a common management console. It consists of a set of “tiles” for common tasks, such as a task inbox, status of services, data connections, a marketplace of add-on services and a tile for each of the cloud services to which a user has subscribed.

The cloud services also share a new set of artificial intelligence and machine learning capabilities called CLAIRE, whose name is an acronym for cloud-scale AI-powered real-time engine. Much like Apple’s Siri, which is not a product separate from the iPhone, CLAIRE is not a stand-alone product; rather it is a set of capabilities embedded throughout Informatica’s product portfolio. Applying machine learning to data management makes lots of sense. Our research shows that in the analytic process, more than half (55%) of organizations reported spending the most time preparing data for analysis, followed by reviewing data for quality and consistency (48%). CLAIRE is designed to evaluate both data and metadata to help automate and optimize data management tasks. For example, machine learning can be used to identify data similarities through routines that automatically tag data, de-duplicate data and make recommendations about which data sets users might want to work with or combine. These recommendations will help users accelerate data preparation tasks. We are currently conducting benchmark research on data preparation which is critical to both operational and analytic business processes. Our Next-Generation Predictive Analytics research shows that users in more than three-quarters (79%) of organizations don’t have the skills to apply these algorithms themselves, but they can certainly benefit from its application embedded within the software systems they use.

CLAIRE was also part of its announced advancements in master data management (MDM) where it places more intelligence into the process for ensuring the accuracy and consistency of data in the enterprise and across the cloud. Our firm has assessed the importance of applying MDM to product information management (PIM) and found that 48 percent of organizations that have integrated them together are satisfied more than those who have not.

They announced Informatica Data Governance & Compliance solution that advances and integrates its products to help organizations take on data challenges like GDPR and HIPAA. The solution combines Diaku Axon, acquired earlier this year, with Secure@Source, a Ventana Research Innovation Award winner in 2015. Informatica’s Enterprise Information Catalog, a metadata search and cataloging capability, has been enhanced with automatic entity discovery, the ability to deal with unstructured data sources and can be extended with custom metadata scanners. In order to support hybrid configurations, the company introduced Informatica PowerExchange for Cloud, which enables PowerCenter developers to connect to cloud data sources. Informatica continues to enhance its Big Data Management (BDM) product, a 2016 Ventana Research Innovation Award winner, which I wrote about last year, with support for Kafka, Spark 2.0, MapR-DB, SQOOP and Teradata Connector for Hadoop. The company also announced support for Amazon Web Services (AWS) and Microsoft Azure cloud deployments, including one-click installation of BDM in these environments.

With these recent announcements, Informatica has positioned itself to take further advantage of the move to the cloud. However, it still needs to convince its customers to join in that journey. Many of the customers I spoke with are still running the company’s on-premises products, and, based on the revenue claims, the cloud is still a minority of Informatica’s business. But the company has created a broad portfolio of capabilities to address end-to-end data management requirements, both on-premises and in the cloud. As I’ve written previously, big companies don’t always get the respect they deserve for creating these robust integrated product sets. If your organization is evaluating hybrid on-premises and cloud data management capabilities I suggest you consider Informatica’s offerings.

Regards,

David Menninger

SVP & Research Director

Follow Me on Twitter @dmenningerVR and Connect with me on LinkedIn.