Vertica customer notes
Dave Menninger of Vertica called to discuss NDA product futures, as vendors tend to do in the weeks before a TDWI conference. So we also talked a bit about the Vertica customer base. That’s listed as 86 at the end of Q2, up from 74 in Q1. That’s pretty small growth compared with Q1, which Dave didn’t fully explain. But then, off the top of his head, he was recalling Q1 numbers as being lower than that 74, so maybe there’s a reporting glitch in the loop somewhere.
Vertica’s two biggest customer segments are telecommunications and financial services, and Dave drew an interesting distinction between what the two groups care about. Telecom companies care about data warehouses that are big and 24/7 reliable, but don’t do particularly complex analytics. Financial services — by which he presumably means mainly proprietary traders — are most focused on complex and competitively innovative analytics.
Also mentioned in various contexts were web-based outfits such as data mart outsourcers, social networkers, and open-source software providers.
Vertica also offers customer win stories in other segments, but most actual discussion about what Vertica does revolves around the application areas mentioned above, just as it has been in the past.
Similar (not necessarily identical) generalizations would be true of many other analytic DBMS vendors.
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At many software companies I have worked at, telecomm and financial were the main customer segments. The large financial companies do not appear to be doing heavy IT buying right now, as I know from some of my friends whose companies have had their revenue growth slow or reverse lately. It would only be natural for Vertica to be affected the same way. In fact, I would expect this to be true across the whole market segments. You’d know the actual answer to that, whereas I’m purely speculating.
Interesting, Tata Consultancy beat analysts estimates as their profits climbed 23 percent according to Bloomberg. Furthermore, the article stated: “Tata Consultancy is seeing some signs of improvement in its biggest market and among financial clients” Chandrasekaran said (executive from Tata).
“We’ve seen growth in the U.S., we’ve seen growth in the financial services sector,” he told reporters at the briefing. “The deal pipeline is healthy and distributed across industries. Still, we’re cautious about manufacturing and high-tech.”
article found here:
http://www.bloomberg.com/apps/news?pid=20601091&sid=ax_4173XVQbU
All most likely due to their lower offshore costs for IT consultancy.
Dave has in the past said that if Vertica were to count end-user organizations, including companies using hosted (Amazon EC2) installations managed by a Vertica customer-partner, then the client base would be over 100.
I’m assuming that the Infobright Community Edition (ICE) has the fastest-growing user base. Do you have numbers here?
As an aside, I was stunned (in a small-scale way) to discover this week that Vertica isn’t the number 2 columnar DBMS after Sybase IQ, that SenSage holds that position.
I had never heard of SenSage. I see that Curt’s list of links for categories in his writings does not have SenSage as an item.
Seth – where did you see that ranking for SenSage?
SenSage is going around contacting influencers. I haven’t spoken with them yet, but pending Seth’s answer I’m guessing the source is the company itself. 🙂
Yeah SenSage and Tenbase are to be reckoned with from what I’ve seen and heard. It’s funny how many smaller players await in the wings when you think about it — not unlike that Groovy “accelerator” one.
@Seth: In terms of Vertica not being #2, are you talking about revenue or market share?
That SenSage (started in 2001) is #2 in the columnar DB market rather than Vertica (started in 2005) isn’t surprising. They’ve been around longer and have the security/ops-management domain expertise. Their DB blew early competition away in terms of data compression & query speed — I’ve heard Vertica is faster but for enterprises that want domain experience and high-touch service I’m not sure that matters.
Stonebraker was a SenSage tech advisor in the early days (e.g., see http://investing.businessweek.com/businessweek/research/stocks/private/person.asp?personId=178671), not sure what current relationship is. Apparently Stonebraker liked the columnar DB idea well enough to start Vertica.
I see SenSage is missing under the “Companies and Products” section just over there —>
Please find out more about the company and let us know.
hmmm, link in posting above doesn’t work, try http://investing.businessweek.com/businessweek/research/stocks/private/person.asp?personId=178671&privcapId=12966384&previousCapId=18561&previousTitle=Accel%20Partners
HadoopDB vs. Vertica [ performance ]
http://db.cs.yale.edu/hadoopdb/hadoopdb.pdf
I’m very curious about how one defines a customer as I have heard all kinds of approaches on this topic. For example, are you a customer if you tried the product, paid for a POC but never purchased the product (whether perpetual license or subscription)?
This is just one example. Are you a customer if you purchased anything services, product, documentation, training, etc. Some businesses would say yes definitely, if an exchange of money took place then YES they are a customer for sure. Wall Street doesn’t care. They do care about services versus product revenues.
Curt, how do you define a customer?
The Sensage “database” doesnt support ODBC/JDBC. You have to use their tools which are built for reading unix security logs. Vertica is better suited for a data warehouse.
I answered offline to Bob, by the way, as he repeated the question there, and most of his questions are irrelevant to a closed-source vendor anyway.
Vertica has been a bit aggressive in its customer counts in the past, but now seems pretty good at only counting outfits with which it has executed a purchase agreement. That leaves a little wiggle room for conditional contracts or whatever, but only a little.
SenSage is ODBC/JDBC compatible, however, it does also provides other methods of accessing the data (as Dave alludes above) including APIs (WS, Java, etc), unix tools, many data export formats. This is designed to help very different customer groups within the same enterprise leverage the DW in a convenient/familiar way.
Product has been deployed in many large deployments for analysis of various types of enterprise data. Here is a write up from EMC: http://www.emc.com/about/news/press/2009/20090601-01.htm along with a nice recognition (2008 EMC Partner Solution of the Year Award) for the many DW solutions deployed jointly: http://tinyurl.com/l6s6qm
Bob Zurek; One thing that you can be certain of is that Vertica’s customer count claims are gross exaggerations of the truth, they list 38 on their web site. Curt is misinformed when he suggests that there is “wiggle room” for conditional contracts, there is not.
All software companies incorporated in the USA must conform to ANSI accounting standards for reporting revenue and must be audited by an accredited accounting firm. The rules that govern how revenue is recognized and hence who you can honestly call a customer are well defined. There must be a license in place for the products that you are selling, a defined fee, and it must not be constrained by language that allows the customer to return the products for any reason such as acceptance wording based on performance criteria or even preferential pricing on product that is not yet completed. Once the license is signed the company must demonstrate that they have physically delivered the software, if done through an FTP server the IP address must be provided.
Vertica’s customer count includes companies that acquired others who actually hold the license for the product (Bear Stearns = JP Morgan) Their count also includes many companies for which they cannot actually recognize the revenue because the customer has performance language in the contracts that allow them to back-out of the agreement if they want. They also list companies as customer who paid a fraction, sometimes as little as 2-3%, of their published price. Almost every start-up software company does this to generate buzz and interest in their company and Vertica is no different
“Bill”,
You’re confused on multiple levels. First, you’re mixing up ANSI with, I suppose, the FASB (or maybe the AICPA). Second, you’re mixing up revenue recognition with a report of customer count. Thirdly, while it is indeed the case that substantially all venture-backed companies are contractually required to have audited financial statements, what you said in that area is confused too.
And by the way, I was pretty involved in the setting of software industry accounting standards, back in the day.
However, you are probably right that, instead of “paying” customers, I should ask about “customers for whom license revenue has actually been recognized.”
Thanks for at least refraining from your usual comment spamming.