(Note: Last Updated January 15, 2021 to reflect the announced purchase price.)

On November 30, 2020, ServiceNow announced an agreement to purchase Element AI, which was one of the top-funded and fastest-growing companies in the AI space.

Element AI was founded in 2016 by a supergroup of AI and technology executives with prior exits including Jean-Francois Gagne, Anne Martel, Nicolas Chapados, Philippe Beaudoin, and Turing Award winner Yoshua Bengio. This team was focused on helping non-technical companies to develop AI software solutions and expectations were only raised after a $102 million Series A round in 2017 followed by a $151 million funding round in 2019.

Element AI’s business model was similar to the likes of Pivotal Labs from a software development perspective or Slalom from an analytics perspective in that Element AI sought to provide the talent, skills, resources, and development plans to help companies adopt AI. The firm was often brought in to support AI projects that were beyond the scope of larger, more traditional consultancies such as Accenture and McKinsey.

However, Element AI faced a crossroads in 2020 in between several key market trends. First, the barrier to entry for AI has reduced considerably due to the development of AutoML solutions combined with the increased adoption of Python and R. Second, management consulting revenue growth slowed down in 2020, which reduced the velocity of pipeline to Element AI and made it harder to project the “hockey stick” exponential growth expected by highly funded companies, especially in light of COVID-related contract delays. And third, the ROI associated with AI projects is now better understood to largely come from the automation and optimization of processes associated with already-existing digital transformation projects that make separate AI efforts to be duplicative in nature, as Amalgam Insights has documented in our Business Value Analysis reports over time.

In the face of these trends, the acquisition of Element AI by ServiceNow is a very logical exit. This acquisition allows investors to get their money back relatively quickly.

(Update: on January 14, 2021, ServiceNow filed that the purchase price was approximately US $230 million or CDN $295 million. This was a massive discount on the estimated $600 million+ valuation from the previous September 2019 funding announcement )

Not every bet on building a multi-billion dollar company works out as planned, but this exercise was successful in creating a team of AI professionals with experience in building enterprise solutions. Amalgam Insights expects that over 200 Element AI employees will end up moving over to ServiceNow to build AI-driven pipelines and solutions under ServiceNow’s chief AI officer Vijay Narayanan. This team was ultimately the key reason for ServiceNow to make the acquisition, as Element AI’s commercial work is expected to be shut down after the close of this acquisition so that Element AI can focus on the ServiceNow platform and the enterprise transformation efforts associated with the million-dollar contracts that ServiceNow creates.

With this acquisition, ServiceNow has also stated that it intends to maintain the Element AI Montreal office as an “AI innovation hub,” which Amalgam Insights highly approves of. Montreal has long been a hub of analytics, data science, and artificial intelligence efforts and it would both help ServiceNow from a technical perspective to maintain a hub here and could help assuage some wounds that the Canadian government may have from losing a top AI company with government funding to a foreign company. Given ServiceNow’s international approach to business and Canada’s continued importance to the data, analytics, and AI spaces, this acquisition could be an unexpected win-win relationship between ServiceNow and Canada.

What To Expect Going Forward

With this acquisition, ServiceNow has quickly gained access to a large team of highly skilled AI professionals at a time when its revenues are growing 30% year over year. At this point, ServiceNow must scale quickly simply to keep up with its customers and this acquisition ended up being a necessary step to do so. This acquisition is the fourth AI-related acquisition made by ServiceNow after purchases of Loom Systems for log analytics, Passage AI to support conversational and natural language understanding, and Sweagle to support configuration management (CMDB) for IT management.

At the same time, Amalgam Insights believes this acquisition will provide focus to the Element AI team, which was dealing with the challenge of growing rapidly, while trying to solve the world’s AI problems ranging from AI for Good to defining ethical AI to building AI tools to discovering product-revenue alignment. The demands of trying to solve multiple problems as a startup, even an ambitious and well-funded startup, can be problematic. This acquisition allows Element AI to be a professional services arm and a development resource for ServiceNow’s ever-evolving platform roadmap as ServiceNow continues to expand from its IT roots to take on service, HR, finance, and other business challenges as a business-wide transformational platform.

Key Stakeholders: Chief Information Officers, Chief Technical Offiers, Chief Data Officers, Data Management Managers, Analytics Managers, Enterprise Information Managers

Why It Matters: SaaS and public cloud data sources are both rapidly proliferating and playing a bigger role in enterprise analytics. It is no longer enough to build a Single Source of Truth without being able to share and integrate data across all relevant sources.

Key Takeaway: This is an evolutionary time for analytics solutions as AI, process automation, public cloud, & SaaS proliferation are quickly changing the demands for analytics. This iPaaS (Integration Platform as a Service) acquisition shows how Qlik is augmenting its core capabilities to keep up with quickly-changing market demands.

About the Acquisition

On October 22, 2020, Qlik acquired Blendr.io, an integration Platform as a Service that supports data integration across over 500 Software as a Service applications and clud data sources. This research note analyzes why Qlik acquired Blendr.io, what this means for current and potential clients of both companies, and key recommendations for data and analytics professionals to consider based on this acquisition.

Blendr.io was founded in 2017 in Belgium by tech entrepreneur Niko Nelissen, who had previous experience in building out marketing automation, event ticketing, data hosting, and data center operations businesses. In short, his background enveloped all aspects of providing data as a service both as backend data infrastructure as well as front-end data used for sales and marketing technologies.

This background led to the creation of Blendr.io, which quickly arose as a tool to support data automation and workflows across data, alerts, caches, applications, and databases. This capability has proven especially valuable at a time when application proliferation has occured and the “trusted business platform” has been replaced by a federation of Best-in-Breed applications that need to be connected together from data, process, and synchronization perspectives.

Based on this need, Qlik’s acquisition of Blendr.io makes sense as a functional addition that both strengthens Qlik’s sales and marketing support and allows Qlik to play a greater role in delivering what they call “Active Intelligence.”

This acquisition also is accretive to Qlik’s prior acquisitions made since it became a Thoma Bravo portfolio company in 2016:

July 2018: Qlik acquires Podium Data to gain a Big Data-fluent data catalog and governance capability.

March 2019: Qlik acquires Attunity to support cloud data synchronization and to validate the advice I had provided at Attunity’s 2013 Analyst Day on the future valuation of Attunity.

January 2020: Qlik acquires RoxAI to support real-time alerts associated with data and analytic changes.

August 2020: Qlik acquires Knarr Analytics assets to strengthen its supply chain analytics capabilities and to bring in key talent.

This acquisition also comes as Qlik is in the process of retiring a prior acquisition, Qlik DataMarket. This 2014 acquisition was originally intended to help clients to combine internal business data with external geographic, financial, or political data. But as access to public external data has become easier to support and business clients have found the challenge of simply managing internal data across a wide variety of private sources to become a bigger challenge, Qlik has made a similar shift through this acquisition.

What to Expect from this Acquisition

Qlik customers with significant SaaS portfolios should be excited to see this acquisition, as it now allows Qlik to develop native analytic products across a variety of marketing, sales, productivity, machine learning, and public cloud platforms. Qlik states that it will start launching products based on the blendr.io acquisition in 2021. Amalgam Insights expects that the combination of iPaaS, data governance, and analytics will allow Qlik to create secure amalgams of data and process automation.

This step of integrating SaaS and cloud data to analytics is necessary for Qlik to deliver on the promise of the “data-driven enterprise” that we have all heard so much about over the past several years. To get beyond the hype, data must be contextualized, analyzed, and used both to accelerate basic rules-based actions and to support decisions based on more complex scenarios, politics, and strategies. Qlik’s acquisition of blendr.io is an important step forward in addition to the Podium Data and Attunity acquisitions in allowing Qlik to support a multi-app, multi-cloud, and multi-data environment where there is no longer the “single source of truth.”

For Blendr.io customers, expect Qlik to continue development on Blendr as a standalone product. It is in Qlik’s best interest to continue the development of Blendr’s iPaaS, as this is a competitive space. Blendr.io competes favorably with the likes of Dell Boomi, Jitterbit, MuleSoft, SnapLogic, Workato, and Zapier. Qlik will be pressured to maintain functionality on par or ahead of its competitors. However, similar to prior acquisitions, expect Blendr to see a name change and an expanded focus on supporting the Qlik portfolio of products. Over time, it would not be surprising to see this “Qlik iPaaS” being more integrated with the Qlik Data Catalyst catalog product and the replication and ingestion components of the Qlik Data Integration platform.

Recommendations

For Qlik customers, this is a good time to start putting pressure on your sales and account team on the types of products you would like to see from a combination of iPaaS integration, governed data, and analytics. Why build it yourself when you can make Qlik do a fair bit of the heavy lifting?

In addition, Qlik customers may want to share their current SaaS portfolios with their account teams to drive the development of the iPaaS. The challenge with managing SaaS-based data is not in connecting one app to one data source: APIs make this task fairly straightforward. The real challenge is that the average enterprise uses over 1,000 discrete apps and data-driven services based on data provided by security vendors such as Symantec and NetSkope, which leads to a near-infinite number of potential connections. Companies must get a “starter kit” of connectors to handle the Pareto 20% of issues that represent 80% of their day-to-day work.

For Blendr.io customers, expect to be introduced to the Qlik portfolio of products. For those who have not looked at Qlik in a few years and think of it mainly as the QlikView visual discovery solution, take a look at Qlik’s portfolio across data management, data lake and warehouse management, data replication, and the Qlik Sense data engine which includes more modern geospatial, search, and natural language analytic capabilities. Since Thoma Bravo’s acquisition of Qlik in 2016, Qlik has expanded its portfolio to support data management challenges.

Conclusion

Overall, Amalgam Insights is bullish on this latest acquisition, as it both fills a gap in Qlik’s existing portfolio of data and analytics capabilities and brings in a technology that is still relatively new and flexible for Qlik to integrate into its quickly growing portfolio. With this acquisition, Qlik gets one step closer to becoming an enterprise data solution.

From a market perspective, it is hard not to compare the moves Qlik makes to the moves made by fellow private equity-owned data companies TIBCO (purchased by Vista Equity in September 2014) and Informatica (purchased by Permeira and Canada Pension Plan Investment Board in August 2015). Qlik’s focus on expanding data discovery and access across frequently used business data has been fairly consistent across its acquisitions. As these companies race towards the financial timelines and outcomes required by private equity, Amalgam Insights believes that Qlik is well on path to creating a whole that is more than the sum of its parts.

If you have any additional questions about this acquisition, the current state of the business analytics market, or how to work with Amalgam Insights, please contact us at info@amalgaminsights.com to set up a consultation.

Key Stakeholders: CIO, CTO, CFO, Software Asset Managers, IT Asset Managers, IT Procurement Managers, Technology Expense Managers, Sales Operations Managers, Marketing Operations Managers.

Why It Matters: The investment in CoreView comes at a time when SaaS proliferation and management are becoming a core IT problem. CoreView’s leadership position in managing Microsoft 365 and enterprise SaaS portfolios makes it a vendor to consider to solve the SaaS mess.

Top Takeaway: Enterprises and IT suppliers managing large SaaS portfolios either from a financial or operational perspective must find a solution to manage the hundreds or thousands of SaaS apps and services under management or risk both security breaches and financial bloat with millions of dollars at stake.

About the Acquisition

On October 5th, 2020, CoreView raised a $10 million Series B round which was led by Insight Partners. CoreView provides a Software as a Service management platform to secure and optimize Microsoft 365 and additional applications as an augmentation of the Microsoft M365 Admin Center.

CoreView was founded in 2014 in Milan, Italy by a team with experience as Microsoft system integrators to provide governance for Office 365 deployments. In October 2019, CoreView augmented its solution with the acquisition of Alpin, a SaaS management solution used to monitor SaaS activity and manage costs.

With this funding, CoreView is expected to increase both its direct clientele as well as its global reseller and service provider base. Having grown almost three-fold over the past year, CoreView is acquiring this funding at a time when SaaS management is becoming an increasingly important part of IT management.

From Amalgam Insights’ perspective, this funding is interesting for two reasons: the quality of the investor and the growing challenge of managing SaaS.

First, this round was led by Insight Partners, which has a strong history of investing in fast-growing DevOps and data companies in line with CoreView’s enterprise software management needs, including Ambassador, Carbon Relay, JFrog, Resolve, Dremio, and OneTrust. Because this investor has been deeply involved with investments in the future of software development and management, Amalgam Insights believes that Insight Partners provides value to CoreView as an investor.

Second, this funding is coming at a time when SaaS proliferation has become an increasingly challenging problem. This funding indicates where the next wave of growth is going to occur in IT management. After a decade of stating that “There’s an app for that, companies must now face the challenge of standardizing and optimizing their app environments. Security vendors such as Symantec and NetSkope have published estimates that the average enterprise uses between 900 and 1200 discrete apps and services on a regular basis, which creates a logistical nightmare.

A decade ago, I wrote on the challenges of Bring Your Own Device and the issues of expense and inventory management for these $500 devices. But with the emergence of Bring Your Own App, multiplied by the sheer proliferation of productivity, sales and marketing, and other line-of-business applications, SaaS management was already coming of age as its own complicated challenge for IT as SaaS was growing 20-25% per year as a market. With the challenges of COVID-19, SaaS has only become more important for keeping remote and work-from-home employees connected to key tools and data.

Recommendations

Based on this funding round, Amalgam Insights makes one key recommendation for IT departments: get control of your SaaS portfolio, which is likely scattered across line-of-business admins, expense reports, and the half of SaaS associated with enterprise software that is currently in IT. Even if the app administration remains in the hands of the line-of-business teams, IT needs to be aware of the data governance, data integration and duplication, and zero-trust based management of least-privilege access across apps. IT still has a job in the SaaS era as SaaS continues to grow from its current size of a quarter of all software in 2020 to Amalgam Insights’ projection in 2025 that the SaaS market will triple to approximately $300 billion and become half of the enterprise software market.

An additional recommendation for all IT agents, resellers, and service providers is to gain a SaaS management capability as soon as possible. At this point, this means looking at two areas: SaaS Operations Management focused on the governance and configuration of SaaS and SaaS Expense Management focused on the inventory and cost optimization of SaaS. There is some overlap between the two as well as some areas of specialization. From Amalgam Insights’ perspective, CoreView is recommended as both an Operations Management and an Expense Management solution with a specialization in supporting Microsoft 365.

If you have any questions about this research note or on the SaaS Management market, please contact Amalgam Insights at info@AmalgamInsights.com to set up time to speak with our analysts.

CNBC’s Jessica Bursztynsky just wrote a nice piece,” Apple fails to market the iPhone 12 Pro to the average consumer”

My take on the article: One of Apple’s traditional strengths has been translating technical capabilities into household tasks. This strength is what allowed the iPhone to take off in the first place when the initial iPhone hardware was inferior to its competitors. As an example, when the iPhone first came out, 3G networks had already been in the United States for five years, yet Apple started with a 2G phone.

The odd part is that the technical capabilities of the iPhone 12 do translate to a more personal phone: take the outdoors home with you, augment your world, get a smarter phone. 5 nm chips are much smarter than any other iPhone ever. But Apple didn’t find a way to bring the story together for the iPhone 12 despite having a more vivid, smarter, faster, and more networked phone. From a technical perspective, the iPhone 12 is a big upgrade, almost a generational improvement.

But Apple fell for the hype of its partners with 5G and 5nm rather than the personal, high-end, affordable luxury game changer branding that has made Apple a juggernaut. If there is anything that Apple should know by know, it is that all of these technical numbers are practically meaningless to its core audience. Although I’ve joked in the past that technology doesn’t seem to exist before Apple acknowledge that it exists, I don’t actually think that works for 5G, as both the infrastructure and use cases for 5G at the consumer level have not been fully figured out yet.

Just as Bose customers couldn’t have cared less about the audiophile’s perspective of Bose products, Apple customers couldn’t care less about the computing specs compared to the simple question of “Does it work?”

Some basic apps or features on the iPhone 12 taking advantage of the enhanced photos, LIDAR, and 5nm based processing in the background would have been great. If Apple can’t figure out how 40%+ faster helps you, how can anyone else?

It’s also interesting that there was little in the new phone regarding security or working from home. I guess Apple figured it has nailed Work and School from Home despite all the challenges that still exist. But for anybody who has either been moved to a work from home situation or has had the interminable experience of helping your kid with a remote schooling environment, you know there is a lot of work left. Some sort of example of how to make the iPhone a work hub would have been really interesting.

To me, the iPhone 12 launch felt like an old Nokia Symbian phone launch that always focused on specs and hardware superiority. Even BlackBerry, back in the day, had more appeal to the feel and UX of its devices. Ask Nokia how that technical superiority sale turned out in the late 2000s. 

I’m not saying Apple will disappear tomorrow. But the iPhone 12 launch looked like that of a mature technology waiting to be disrupted rather than a technology designed to further enhance your life. This is an interesting time to watch the evolution of the smartphone industry, as augmented reality devices are not ready for the mainstream yet, Huawei is dealing with geopolitical challenges, Samsung continues to produce a variety of smart devices, and Google has revived the Pixel brand with an impressive set of recent device models.

My recommendation: the iPhone 12 is an interesting set of functionalities that still lacks the infrastructure and apps to fully take advantage of what it does. I think this will be a great device to purchase around the same time that a COVID vaccine becomes generally available, probably around Summer of next year. Until then, if you want to get used to the photo and LIDAR capabilities of the phone or are in a city with good 5G coverage, the iPhone 12 is a good starting point.

For more context on 5G, please read our strategic guide on 5G or contact us at info@amalgaminsights.com to set up a strategic consulting session.

If you’re moving into cloud, Amazon launched a service on September 25th called AWS Cost Anomaly Detection within AWS Cost Management to find surges in spend. Part of the product is a machine learning algorithm that tracks your spend to ensure that spend peaks aren’t just part of a cyclical spend change and to detect anomalies. One of the interesting aspects of this product to me is the flexibility of monitoring spend based on service, account, category, or tag.

The tagging capability is the most interesting one to me, as tags are how cloud costs are effectively cross-charged to projects, cost centers, geographies, and the other financial categories that are most relevant from an IT expense and financial management perspective. Although the other spend monitoring categories are interesting from a practitioner level and obviously should be used to optimize spend, they will likely be less useful to share with your colleagues.

I’m especially interested in seeing more detail about how machine learning ends up tracking AWS service spend over time to correct its recommendations. One of the interesting aspects of this service is that you actually do not choose your parameters for which anomalies get tracked, as the algorithmic approach picks up every spike. Rather, the service focuses on when it should alert you to changes and anomalies based on the size of the spike. And then you can choose to be alerted in near-real time, daily, or weekly basis.

Given that it’s currently a beta product, I’m betting that the alerts and recommendations aren’t quite fully baked at this point. But even so, this optimization moves cloud towards the state of in-billing period monitoring and optimization that we’re used to doing in wireless and wired spend. Take a look and see how Cost Anomaly Detection starts to shape and optimize your AWS services’ spend.

Of course, this is an AWS-specific service, so there are still opportunities both for other cloud providers to provide similar services as well as for the leading third-party cloud service management providers such as Apptio Cloudability, Cloudcheckr, CloudHealth by VMware, Calero-MDSL, Flexera, Snow Software, Tangoe, and Upland Software to also develop similar capabilities for multi-cloud.

For now, Amalgam Insights recommends taking a look at the documentation and learning how the service works. We are starting to transform IT cost management from a practice of manually tracking cost data on our own to depending on algorithms and machine logic to do the hard number-crunching and swivel-chair work for use. Even if you’re not going back to school to learn the linear algebra, calculus, and neural net designs needed to do data science on your own, you need to have an idea of what can and can’t be done through algorithmic means.

On September 30th, 2020, workforce expense vendor Motus announced the acquisition of Vision Wireless, a wireless expense management company based in Augusta, Georgia in the United States. This purchase demonstrates Motus’ continued focus in enterprise mobility to add to its September 2019 purchase of Wireless Analytics.

Vision Wireless was founded in 2003 with a focus on wireless expense management and managed mobility services provided to Fortune 1000 and mid-sized enterprises. In recent years, Vision Wireless has taken a greater role in providing thought leadership to the industry at large, including its recent sponsorship of Amalgam Insights’ Technology Expense Management Expo.

Over the past decade, I’ve typically recommended Vision Wireless as an appropriate vendor for North American-based organizations over $1 billion in revenue. Vision Wireless is known for its strong managed service capabilities with white-glove service and a software solution that supports integration with a variety of accounts payable, general ledger, procurement, IT service management, human resources, and mobile device management solutions. Vision Wireless was also working on increasing its automation, self-service, and integration capabilities.

With the acquisition by Motus, Amalgam Insights expects that Vision Wireless’ platform development will accelerate to support Motus’ ambitions of becoming a full-service remote worker solution. Over the past year, Motus has brought its Fixed and Variable Rate methodology to mobile devices to help companies support Total Cost of Ownership and expense analysis across both business and personal (Bring Your Own Device) use cases.

What’s Next?

Vision Wireless customers should expect to see no significant changes in their support in the immediate future. Motus acquired Vision Wireless in no small part to acquire the quality and depth of service that Vision Wireless has provided to its clients for years. At the same time, Vision Wireless customers should also be aware that Motus also has a fleet management solution for organizations that conduct business activities with personal vehicles. For companies seeking to improve their remote worker expense management, this Motus solution may be an opportunity to help support both current working conditions as well as a post-COVID future that maintains a significant remote worker population.

Motus customers gain a high-quality mobility support and managed services team with experience supporting clients such as Aramark, ServiceMaster, and CVS Health. This acquisition will ease Motus’ ability to support integration with a variety of software solutions and platforms, such as ServiceNow, SAP Ariba, Coupa, and leading ERP solutions.

Amalgam Insights is also interested to see how this acquisition affects the market for remaining high-quality managed mobility services and wireless expense solutions that we track such as Advantix, GoExceed, ICOMM, Intratem, mindWireless, Mobichord, MobilSense, Mobile Solutions, Valicom, and vMox.

In the long term, as cars become increasingly connected, the Internet of Things become ubiquitous, and the need for remote mobility support only becomes greater over time, Amalgam Insights believes that Vision Wireless’ long-time expertise in supporting enterprise mobility support will prove to be a strong asset for Motus. Amalgam Insights also believes that this is not the end of Motus’ acquisition streak, as a Thoma Bravo portfolio company. For Motus to fully unleash its potential as a remote worker reimbursement vendor, Amalgam Insights believes that there is still room for Motus to expand into cloud management, security, home office expenses, and other business categories that are split between corporate and personal responsibilities.

Overall, Amalgam Insights believes that this acquisition represents a strong commitment by Motus to continue expanding its support of enterprise mobility, an acquisition of a strong enterprise client case, and an opportunity to use Vision Wireless’ managed services foundation and platform to help expand its remote work support. This acquisition is indicative of what should be happening in the wireless and telecom expense market: accretive acquisition to support a bigger picture, such as the future of remote work management, the future of IT management, and the future of employee management. Expect more acquisitions like this in the near future.

Last Updated January 20th, 2021

(Update: As of January 20th, with the presidential inauguration of Joe Biden, it seems unlikely that the Biden administration will continue the pursuit of the US ban on Tiktok. This follows U.S. District Court Judge Carl Nichols Dec. 7 ruling that the Commerce Department had “likely overstepped” its authority in placing the ban. An earlier injunction on shutting down Tiktok services on October 30th in the United States Court of Appeals for the Third Circuit by Judge Wendy Beetlestone is currently scheduled to be appealed in February 2021.)

Key Takeaway: Master tactician Larry Ellison gains a feather in the Oracle Cloud by playing the long game and positioning Tiktok as a significant Oracle Cloud customer. Well played, Mr. Ellison.

As if 2020 hasn’t been weird enough, many of us are finding out that enterprise stalwart Oracle is apparently going to purchase Gen Z (born after 1995) and Gen Alpha (born 2010 or later) social media darling Tiktok.

What? Is this actually happening?

Well, not quite. But to explain, first we need to look at the context.

Last month, President Trump created an executive order to ban Tiktok in the United States based on security and censorship issues. This move was seen both as a move against the Chinese economy and to protect global social media platforms based in the United States such as Facebook and Twitter.

In response, a number of potential suitors showed up with either bids or proposals to support Tiktok in the United States. Microsoft showed interest in purchasing Tiktok to support its Azure cloud and gain a massive source of video content that would be useful across Microsoft’s marketing (Bing), gaming (XBox, Minecraft), augmented reality (Hololens), and artificial intelligence (Azure AI) businesses. And at one point, retail giant Walmart was associated with this bid, perhaps in an attempt to fend off Amazon in this digital path. But this bid was shut down was rejected on September 13.

Oracle came in after Microsoft, showing interest in Tiktok. At the time, there was massive confusion from the market at large on why Oracle would be interested. But, as someone who has written about the tight relationship between social technologies and the cloud for many years, my immediate thought was that it’s all about the cloud.

Oracle has been forcefully marketing Oracle Cloud Infrastructure as an enterprise solution after making significant investments to improve connectivity and usability. These recent changes have led to significant logo wins including Zoom and 8×8, both of which chose Oracle for its performance and 80% savings on outbound network traffic. The cost of connectivity has traditionally been a weak point for leading cloud providers, both due to a lack of focus on networking and because cloud vendors have wanted to gate data within their own platform and have little to no incentive to make inter-cloud transfers and migrations cheaper and easier. But Oracle’s current market position combined with its prior investments in high performance computing and network performance means that it makes good business sense for Oracle to be the most efficient cloud on a per-node and bandwidth perspective and to attack where other cloud vendors are weak.

Social media and communications vendors are massive cloud customers, in their own right. Pinterest has a 6 year, $750 million commitment with Amazon Web Services and is easily on pace to spend far more. Lyft has its own $300 million commitment wth AWS. And Citrix has a $1 billion commitment with its cloud vendor of choice, presumably Microsoft Azure. The cloud contract sizes of large and dynamic social and video-centric vendors is enormous. Every cloud provider would be glad to support the likes of Tiktok as a customer or potentially even as a massive operations writeoff that would be countered by the billions of dollars in revenue Tiktok provides.

And, of course, Tiktok creates a massive amount of data. Similar to Microsoft’s interest in Tiktok, Oracle obviously has both expertise and a large business focused on the storage and analysis of data. Managing Tiktok content, workloads, and infrastructure would provide Oracle with technical insights to video creation trends and management that no other company other than perhaps Alphabet’s Youtube could provide. Over the past couple of years, Oracle has put a lot of effort both into database automation and cloud administration with its Gen2 offering.

In addition to bolstering Oracle’s cloud, Tiktok also could make sense as a tie-in to Oracle’s Marketing Cloud. At a time when large marketing suites are struggling to support new platforms such as Tiktok, what better way to develop support than to own or to access the underlying technology? But wait, does Oracle have access to Tiktok’s code and algorithms?

Apparently not. Current stories suggest that Oracle will be the hosting partner or “Trusted Technology Provider” for Tiktok America while Tiktok parent company ByteDance still maintains a majority ownership of the company. It looks like Oracle has positioned itself to be the cloud provider for a massive social media platform, as the United States alone has over 100 million active users on Tiktok. And the speculation behind Microsoft’s rejected bid is that Microsoft sought to purchase the source code and algorithms of Tiktok, which ByteDance refused to provide.

So, the net-net appears to be that in response to Trump’s Executive Order, Oracle will gain an anchor client for Oracle Cloud Infrastructure while making some investment into the new Tiktok US organzation. Oracle’s reputation for security and tight US government relations are expected to paper over any current concerns about data sovreignty and governance, such as Chinese access to US user data. Current Tiktok investors, such as General Atlantic and Sequoia Capital, may also have stakes in the new US company. This activity effectively puts more money into a Chinese company. Most importantly, this action will allow Tiktok to remain operational in the United States after September 20th, the original due date of the executive order.

Congratulations to Oracle and Larry Ellison on a game well played.

As we progress along the road of this pandemic-driven recession, CIOs and IT departments need to keep a clear-eyed view of the future and the tasks that we are held to manage. Because even as we deal with all the challenges of remote work, distributed decisions, and uncertain economic environments, we are also held to the challenges of supporting future business needs and supporting the next generation of technology, which continues to be created and launched. 

This means that we need to follow the path of COVID IT

If you’ve followed the stages and actions we recommended in our webinar series or at our Technology Expense Management Expo, you’ve passed through the stage of pure survival, securing remote work, and auditing your environment. Now, we are at Stage 4, which is to gather best practices, celebrate successes, and train employees on the New Normal.

A key aspect of Stage 4 and Stage 5 is the use of data and analytics to support better decision making, improved forecasting, more nuanced automation, and more accurate models and workflows to make sense of complex business phenomena as your organization continues to move from BI (Business Intelligence) to AI (Artificial Intelligence).

To prepare business data for future needs, Amalgam Insights recommends the following steps:

First, improve data collection. This means treating all data in your business as something that will be reused to provide value and cleaning up all existing data through data prep, data quality, and data transformation tasks. It also means putting data into the right format: the age of the relational database as the only tool for analytics is disappearing as non-relational and NoSQL databases have come to the forefront and graph databases like Neo4j and Amazon Neptune finally start their ascendent rise as relationship analytics and semantic search start to eclipse standard Boolean AND, OR, NOT and SQL-based logic.

This isn’t to say that SQL is going anywhere. I still recommend that anybody using data start with a strong foundational knowledge of SQL, as this is probably the only skill I learned 20 years ago that I still use on a regular basis. Skilled relational data querying will always have an important role in the business world. But for business analytics and data managers trying to figure out what is next, consider how to expand your data sources, data quality, and data formats to fit what your company will ask for next.

Second, contextualize your data. One of my favorite sayings, first attributed to Jason Scott, is that “Metadata is a love note to the future.” The ability to prioritize, categorize, and contextualize data sources, fields, and relationships is vital to supporting the future of machine learning and natural language analysis. This means supporting data catalogs, data unification, and master data management tools to bring data together. This stage of data maturity is easy to ignore because it requires getting business context from relevant stakeholders to manage and define data. Given that it can be hard enough to get business users to simply enter data accurately and consistently, the effort to get data definitions and context can be intimidating. But this is a necessary precursor to having “smarter” data and to making the “smarter” decisions that businesses are promised by analytic and machine learning solutions. And the combination of data prep, cleansing, and context make up the majority of work that data scientists end up doing as they try to create relevant models. Solutions that Amalgam Insights recommends most often in this area include Alation, Atlan, Collibra, Informatica, Qlik, Talend, Unifi, and the offerings from megavendors SAP, Oracle, and IBM.

Third, make visualization tools and outputs ubiquitous. Every person in the company should have access to relevant metrics that drive the company. It’s 2020: we’re beyond the time of Skynet and the Terminator, Blade Runner, HAL, and other iconic cinematic visions of the future. The very least we can do is make basic charts and graphs available and accessible to all of our co-workers. Find out what prevents line-level employees from accessing and using data and break down those barriers. Amalgam Insights’ experience is that this challenge comes from a combination of not knowing how to find the right data and how to form the right charts. The answer will likely come from a combination of natural language enhancements driven by the likes of ThoughtSpot, Narrative Science, and Tellius as well as visualization and reporting specialists such as Yellowfin and Toucan Toco and embedded analytics specialists such as Logi Analytics and Izenda.

Fourth, shift from reporting and discovery to predictive analytics. Over the past decade, Tableau has been a fantastic tool for data discovery and continues to lead the market in helping companies to find out what is in their data. However, companies must start thinking of data not only in terms of what it tells us about the present, but how it helps to structure our work and forecast what is next. Data can be used to structure descriptive and predictive models through iterative and guided machine learning. Google’s work with Tensorflow stands out as an end-to-end machine learning solution. During Amalgam Insights’ short existence, DataRobot has quickly risen to become a leader in automated machine learning and its acquisitions of Nexosis for accessibility, ParallelM for MLOps, and Paxata for data prep help have stood out. Microsoft Azure, Amazon Web Services, and IBM Watson also have their own services as well: there are a variety of options for modeling data.

By taking these steps, you can ensure that your data does not fall prey to a premature death as it is rendered obsolete or surrounded by enough technical debt to become functionally useless. If you have any questions on how to better support your data from a future-facing perspective, please contact us at research @ amalgaminsights.com to set up a consultation.

I was recently chatting with Andi “TEMGirl” Pringle on LinkedIn about career options and skills for the telecom and technology expense analysts. Given that most of my jobs over the past 20 years have been related to telecom billing and expenses, I have a few opinions on this topic. So, to start with…

First, here’s the reality. Telecom expense management is a commoditized job. Telecom spend is not growing, on a global basis, from year to year and CIOs don’t think of telecom as one of their top priorities compared to digital transformation, cybersecurity, process automation, artificial intelligence, or customer experience.

So, where can you go from here? For now, if you’re managing $10 million or more a year in spend, then your efforts should be preventing enough to justify your salary on a revenue per employee basis. Part of your job is to show your manager that your efforts are saving several hundred thousand dollars a year or more by finding those Zero use circuits and phones, optimizing services, and keeping people up and running because nobody will do it for you.

But you also need to upgrade your skills for the long run. Telecom will continue to become just another app running on the network and cloud computing has already eclipsed telecom as being more strategic in importance even though the global market for cloud computing is still only about $250 billion compared to the $1.4 trillion on telecom.

So, there’s a few different directions you can go in depending on whether you want to focus more on the data, finance, technology, project management, strategy, or consulting aspects of the job.

Data Science/Analyst: If you want to dig deeper into the data, you need to understand relational databases and then how to deal with the statistical modeling and analysis of data. Start by learning SQL, the lingua franca of data and the one technical skill that I’ve used consistently over the last 20 years. Then you’ll need to use Python, and/or R along with statistics and calculus classes to understand modeling and to know what you’re doing with your statistical and modeling libraries. The data science role is all about fitting the right algorithms and statistical models to your data, but it all starts with the database and setting up queries. This is actually where I started when I got into telecom, as I had both a computational chemistry and a competitive fantasy baseball background where I’d work on tweaking player forecasts and performance variances. Back then, we used SAS and SPSS rather than R, but tools change over time.

Accounting: Learn some basic financial and managerial accounting as well as micro and macroeconomics. These classes will help you to track costs more effectively, get some business context for costs, and to broaden your skills from telecom-specific cost management to business-wide cost management. The differences aren’t enormous and, frankly, I think telecom expense is one of the hardest costs to manage. A project management or operations management course doesn’t hurt either, as a lot of this role is understanding costs, resources, and business drivers for planning and forecasting. But having an accounting and basic finance background will allow you to translate IT cost management to a broader planning and budgeting capability. This was what Planful CFO Shane Hansen spoke about at our recent Technology Expense Management Expo.

IT Management: Amazon is the new Cisco and there is more new cloud spend this year than telecom spend. It all goes back to tracking storage, network, and compute units across every service, but dig into the service types and learn about cloud services just as you’ve learned about USOCs, FIDs, and service order fields. Cloud providers are the new telcos in terms of being the providers that power IT. Interestingly, a lot of these cloud bills are in the hands of cloud architects and developers who are learning to manage cloud costs from scratch. This management practice is often not called Cloud Cost or Cloud Expense Management (because that would be too easy) but is also called FinOps or a section of Cloud Service Management. We had multiple sessions on cloud infrastructure and software management at the TEM Expo from Corey Quinn, Robert Lee Harris, and Lukas Smith.

Project Management: The PMP is the key certification here. Even if you don’t work on getting the certificate, since some of their materials are starting to get dated, their recommended topics and PMBOK are a helpful starting point. One of the reasons I was glad that Upland Software was an exhibitor at the TEM Expo is that they provide both technology expense and project management software together. I think it’s fundamentally important to have a single toolset to manage projects and cost structures. This is actually a trend in the telecom expense world as a number of solutions start to have SD-WAN or network project management modules as a part of their solution. I think the TEM players will be pushed to go farther.

Managed Service Providers: Being on the vendor side can be an interesting way to work with multiple organizations, sometimes at once, to figure out what similarities and differences exist beween organizations. It can be easy to get stuck in the specificities of your own organization and miss out on some of the best practices and innovations that exist in the market at large because they don’t align with your own organization’s specific governance and compliance issues. Also, being on the vendor side can be a gateway into learning how the management of TEM as a business works and can be a gateway either into moving to service, product, and consulting roles or to become a manager or to learn how to be a full-time consultant on your own.

And finally, if you enjoy either teaching the topic or solving a specific type of TEM problem, you may be better off either as a consultant or industry analyst. (Note: this step requires you to be part of the front office and to either develop or hone your sales chops!) This is the leap I took 12 years ago when I became an industry analyst and I’m always glad to discuss how I did it and where you can learn this craft.

If you’re currently a telecom expense analyst or manager, I highly encourage you to go in one or more of these directions to upskill yourself and continue moving up in your career. If you have any questions about any of these paths, please don’t hesitate to ask me at hyoun @ amalgaminsights. com.

One of the tactical problems I get asked about most often is how to manage cloud Infrastructure as a Service within an IT cost management environment. As someone who recommends boh telecom expense management and cloud cost management solutions, I’ve seen that the paradigm typically used for telecom, servers, on-prem software, and other traditional IT assets and services doesn’t work as well for cloud both because of the transient nature of cloud services and that public cloud is often purchased solely by technical buyers, with professional sourcing and finance professionals being left out entirely.

This has led to a new practice that has been called Cloud Cost Management or, alternatively, FinOps (even though the abbreviation FinOps does not refer to the Operations of Finance or the CFO office, but that’s a debate for another time…)

In practice, this means that even the most basic general ledger or Active Directory taxonomy used for the vast majority of business costs is not used for the cloud because the people involved don’t know where to start. From a practical perspective, this means that cloud buyers often don’t get to take advantage of the business structure that most of the rest of IT purchasing has and end up having to recreate basic business categories from scratch.

As you start managing cloud services, you will most likely have to tag your resources within your management solution of choice because of the relative financial immaturity of cloud management solutions.

(There are exceptions: Apptio Cloudability, Calero-MDSL, CloudHealth by VMware, and Tangoe being the best examples)

The basic starting point for tagging is to look both at financial management and operational management.

For financial management, ask your controller or accounting team how they break down IT costs, then use the same categories for your tags. It’s usually some combo of employee ID, cost center, profit center, geography, project ID, General Ledger ID, but every company does its books a little differently.

Then the operational management is based on your IT org’s view of technology management, which could include applications, projects, technologies, staging environments and software supported, cloud service categories, functional IT tasks. This process is well-aligned to an IT Finance or Technology Business Management approach where technology is aligned to specific operational and functional tasks and responsibilities. But you may also need more granular tags that assign each resource to automated governance, security, data transfer or architecturally defined tasks. Each task or function should roll up to a functional manager, project manager, or stakeholder.

In thinking about the operational side of tagging, we recommend looking at Apptio Cloudability, CloudHealth by VMware, CloudCheckr, and Replex as starting points.

These tags end up being the taxonomy for your cloud environment and should ideally match up with existing IT taxonomies across IT asset management, project management, service management, and financial management. Otherwise, you risk reinventing the wheel and using up tags on categorization that only makes sense for yourself or your immediate team.

In addition, after creating these tags, you may also want to group these tags into larger dimensions that are associated with a specific use case, solution, or output with the goal of having shortcuts to manage what can be an intimidating number of services, resources, and tag combinations.

Over the next couple of months, Amalgam Insights will be providing more guidance in this space both with our SmartLists on Kubernetes Cost Management and Market Leaders in Technology Expense as well as releasing our videos on managing cloud costs from our recently completed Technology Expense Management Expo. If you have any suggestions for key issues we should include in these reports, please let us know at research@amalgaminsights.com.

And in case you missed it, here’s our recommendations for managing cloud cost from earlier this year.