Data warehouse heavyweight Teradata Operations, Inc., is buying its way into the future of Big Data, writes Wikibon Principal Research Contributor Jeff Kelly in his latest Professional Alert.

Since 2011 Teradata has acquired Aster Data Systems, Hadapt (SQL-on-Hadoop) and Revalytics (Hadoop-focused data management). It also signed a partnership with Hortonworks, Inc. that includes deep technical integration between the Hortonworks Data Platform (HDP) and Teradata’s Aster and data warehouse platforms. Earlier this month it also announced plans to acquire professional services company Think Big Analytics, which specializes in Big Data technology including Hadoop and NoSQL databases and data science services. Its customers include Johnson & Johnson, Ancestry.com and Facebook.com. This, Kelly writes, will move Teradata into Big Data professional services, a business that delivers high margins but that is difficult to scale.

The acquisitions show that Teradata understands that data warehouses are losing their place as the center of the corporate data architecture and that its highly successful business building and selling expensive proprietary data warehouse appliances is a poor fit in the Big Data world of open source software running on commodity hardware.

To survive, Kelly writes, Teradata needs to continue building out its Hadoop capabilities through further acquisitions, partnerships and internal R&D. However, it cannot rely solely on Hadoop to replace the revenues from its slowing data warehouse business, in part because of the cost-characteristics of open source and in part because the market is already crowded with competitors like Hortonworks, MapR Technologies, Inc., Cloudera, Inc., Pivotal Software, Inc. and IBM.

That means Teradata needs to move up the stack by developing differentiated analytics software and applications focused on specific business problems, Kelly notes. Targeted Big Data software and applications are rare today but necessary if mainstream enterprises are to achieve full value from Big Data investments. This is a significant market opportunity for Teradata, which has a long history in analytics.

Kelly’s full Professional Alert, “Teradata Turns to Acquisitions, Partnerships to Adapt to Big Data Realities”, is available without charge on the Wikibon website.  IT professionals are invited to register for free membership in the Wikibon community. This allows them to influence the direction of Wikibon research and contribute to that research as well as posting comments, questions and their own research on the site.

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