You know you are a geek when your friends and you meet over the holidays with explicit instructions from spouses to 'geek out'. Well geek out we did and being that peculiar sub species of geek concerned with data, we geeked out on current trends in data and technology. The topic that caused the most disruption and excitement for us was the question how much headway hosted BI systems will make over 'installed' the next few years. Specifically we debated on how to best track so-called web applications – the hottest area of development in the past few years. We broke up the analysis into setup costs, design, build, etc. See for yourself:
In-House Hosted Advantage Examples SQL Server Stack, Oracle Stack Omniture, Gatineau, Amazon SimpleDB, and future products. n/a Setup Costs Licenses, hardware purchase, hardware setup, dev + test Licenses are more geared toward usage e.g. pay per storage, pay per server calls, etc Hosted Design Let you imagination run wild! Mix and match different hardware and software. Lots of flexibility. Limited flexibility. Whether placing data in places like Amazon's SimpleDB (which is more like a fancy Hash and isn't relational) or even overloading Omniture's event model to simulate a Star Schema, hosted models are more limited. In-House Build Flexibility in design leads to greater costs in the build phase. Generally easy. Hosted systems have less knobs to turn. Often dev, int, test environments are provided free of charge or are very low cost. Hosted Labor Difficult to generalize. Difficult to generalize. Toss Up Operations Big reductions in operational costs over the past few years especially in the RDBMS platforms. Biggest win here. Few worries around scale, uptime, etc. Hosted Security Like in “Build”, advantages handling custom requirements. But disadvantage in that not all teams have security experts. Depends on how much you trust your vendor. Large vendor shops may have the advantage here as they have the opportunity to build out stronger secure processes. Toss Up Privacy Difficult to generalize, but given the importance of privacy – no substitute exists for owning the data. See left. In house Key Advantages Ability to deeply integrate with other inhouse systems. Vendors with hosted systems typically offer APIs, but having the entire system locally can sometimes get you out of a pinch. Complex, but well defined uses. web analytics. payments systems. perhaps some HR systems where compliance comes into play. In web analytics the choice is easy. Also given the lower start up costs, hosted solutions are good fits for low costs scenario e.g. small, siloed (on purpose) departmental reporting.
In-House
Hosted
Advantage
Examples
SQL Server Stack, Oracle Stack
Omniture, Gatineau, Amazon SimpleDB, and future products.
n/a
Setup Costs
Licenses, hardware purchase, hardware setup, dev + test
Licenses are more geared toward usage e.g. pay per storage, pay per server calls, etc
Design
Let you imagination run wild! Mix and match different hardware and software. Lots of flexibility.
Limited flexibility. Whether placing data in places like Amazon's SimpleDB (which is more like a fancy Hash and isn't relational) or even overloading Omniture's event model to simulate a Star Schema, hosted models are more limited.
Build
Flexibility in design leads to greater costs in the build phase.
Generally easy. Hosted systems have less knobs to turn. Often dev, int, test environments are provided free of charge or are very low cost.
Labor
Difficult to generalize.
Toss Up
Operations
Big reductions in operational costs over the past few years especially in the RDBMS platforms.
Biggest win here. Few worries around scale, uptime, etc.
Security
Like in “Build”, advantages handling custom requirements. But disadvantage in that not all teams have security experts.
Depends on how much you trust your vendor. Large vendor shops may have the advantage here as they have the opportunity to build out stronger secure processes.
Privacy
Difficult to generalize, but given the importance of privacy – no substitute exists for owning the data.
See left.
In house
Key Advantages
Ability to deeply integrate with other inhouse systems. Vendors with hosted systems typically offer APIs, but having the entire system locally can sometimes get you out of a pinch.
Complex, but well defined uses. web analytics. payments systems. perhaps some HR systems where compliance comes into play. In web analytics the choice is easy.
Also given the lower start up costs, hosted solutions are good fits for low costs scenario e.g. small, siloed (on purpose) departmental reporting.
So the total score is: Hosted 3, In House 2. Of course the specifics of the business data needs far outweigh our generalizations. Being happy with saying that both the hosted and inhouse will coexist, we are watching the auspicious beginnings of general purpose offerings like Amazon's SimpleDB. While as mentioned above it currently doesn't have the flexibility of an in house solution, the rate of change of hosted solutions can be faster (for both reasons of controlling everything server side with the release every few weeks and also the open interface that allows more companies to collaborate on developing) and with costs often 1 to 2 orders of magnitude cheaper its hard not to imagine some exciting developments in this space.