Software delivery and pricing — the first 55 years
The commercial computing, software and services industries have existed for half a century or so each. It might be interesting to review how their pricing and delivery models have evolved over time.
1960s and 1970s
Modern IT is commonly dated from the introduction of the IBM 360 mainframe in 1964-5. But even before then, there was a growing industry in what we’d now call outsourced services, specifically in payroll processing; major players included Automatic Data Processing (ADP), the company that gave us Senator Frank Lautenberg, and a variety of banks. This was (and to this day remains) a comprehensive service, priced by unit of work (e.g., number of payroll checks cut).
IBM mainframes, which quickly came to dominate the market, were in the 1960s and 70s commonly rented. IBM software that ran on them was hence typically priced on a rental/subscription basis as well. The independent packaged software companies, however, often preferred to get paid up front,* and hence sold perpetual licenses to their software. Annual maintenance fees for the licensed software started in the range of 10% of the perpetual license or even less, but migrated up to today’s 20-22% range.
| Categories: Analytics, Application software, ASK Computer Systems, Computer Associates, Computer services, Cullinet, EDS, IBM, MSA, Oracle | 10 Comments |
Further history of the term “Business Intelligence”
I previously posted that the term Business Intelligence dates back to the 1950s, even though Howard Dresner has claimed credit for inventing it at a couple of different points in the 1980s.
Now the term Business Intelligence has been tracked all the way back to 1865.
| Categories: Analytics | 4 Comments |
Historical notes on the departmental adoption of analytics
This post is part of a short series on the history of analytics, covering:
- Historical notes on analytics — the pre-computer era
- Historical notes on analytic terminology (in which many terms used in this post are defined)
- Historical notes on analytics — departmental adoption (this post)
What set off my “history of analytics” posting kick is, simply put:
- Most interesting analytic software has been adopted first and foremost at the departmental level.
- People seem to be forgetting that fact.
In particular, I would argue that the following analytic technologies started and prospered largely through departmental adoption:
- Fourth-generation languages (the analytically-focused ones, which in fact started out being consumed on a remote/time-sharing basis)
- Electronic spreadsheets
- 1990s-era business intelligence
- Dashboards
- Fancy-visualization business intelligence
- Planning/budgeting
- Predictive analytics
- Text analytics
- Rules engines
| Categories: Analytics | 11 Comments |
Historical notes on analytics — terminology
This post is part of a short series on the history of analytics, covering:
- Historical notes on analytics — the pre-computer era
- Historical notes on analytic terminology (this post)
- Historical notes on analytics — departmental adoption
Discussions of the history of analytic technology are complicated by the broad variety of product category names that have been used over the decades. So let me collect here in one place some notes on how (and when) various terms have been used, specifically:
- Management information systems
- Decision support (systems)
- Report writer
- Fourth-generation language
- Executive information system
- Business intelligence
- OLAP (OnLine Analytic Processing)
| Categories: Analytics, Cullinet | 15 Comments |
Historical notes on analytics — pre-computer era
This post is part of a short series on the history of analytics, covering:
- Historical notes on analytics — the pre-computer era (this post)
- Historical notes on analytic terminology
- Historical notes on analytics — departmental adoption
Sometimes, what people describe as being “New, new, new!!!” in analytics has actually been happening since before they were born, or even before their parents were. Occasionally, I point this out. 🙂 I think it’s time to collect some of those observations into a short series of posts.
Before getting to the history of actual analytic software, I can’t resist racing through some really old stuff. In a 2004 white paper, I wrote:
Transactional business processes have been around literally since the beginning of recorded history. Some of the oldest known writings are clay tablets that record merchants’ tallies in Sumerian cuneiform, complete with seals to enforce transaction integrity. Analytic business processes date back nearly as long, especially in military applications; the first chapter of Sun Tzu’s The Art of War is called “Calculations,” or in some translations “Laying Plans.”*
As enterprise complexity increased, so did the sophistication of analytic business processes. Almost two centuries ago, Nathan Rothschild made an investment fortune from early news about the Battle of Waterloo, and several decades later Florence Nightingale** introduced statistics to the study of public health. With the invention of machines to tabulate information in the late 19th Century, analysis began to blossom.
| Categories: Analytics | 6 Comments |
A software marketing pitch from 1972
In the process of researching my recent post on Management Horizons Data Systems, I came across an excerpt from a 1972 marketing brochure (quoted in the “History of Management Horizons” piece cited there). General notes include:
- The brochure quote basically pitches business intelligence/ performance management, with unconstrained drilldown.
- Pitching BI/analytics benefits for what start out as being transactional applications has been going on for pretty much the whole history of the applications industry. This just happens to be a great proof point.
- The unconstrained drilldown part could almost be taken for granted today, in the relational era. In 1972, however, it was a rather bold (and for all I know exaggerated) claim.
The exact verbiage is:Â Read more
| Categories: Analytics, Application software, Computer services | Leave a Comment |
David Childs
Talking to Algebraix reminded me that David Childs is still alive and kicking. I only ever encountered Childs once, in the early/mid-1980s, when he was pushing his company Set Theoretic Information Systems. The main customer example for STIS was General Motors, for which he had achieved a remarkable amount of database compression. It was something like 4-5X, if I recall correctly, but for 1983 or whatever that was pretty darned good. The idea was to replace data by partitioning according to shared values. E.g., you didn’t store whether cars were red, blue, or green; instead, you stored records about all the red cars in one place, the blue cars in another, and so on. There was also some set-theoretic mumbo-jumbo, but I never figured out what it had to do with implementing anything.
Comshare — a BI vendor before anybody called it BI — did actually build a DBMS based on Childs’ ideas, as Ron Jeffries reminds us. It was relational. Eventually, if I recall correctly, it was swapped out for Essbase (the original MOLAP product, now owned by Oracle).
What Childs really focuses on, however, seems to be “Extended Set Theory.” (This was brought to my attention by Algebraix, even though Algebraix doesn’t actually use many of Childs’ ideas.) And he’s been doing it for a long time. Way back in 1968, Childs wrote a paper outlining how set theory, relations, and tuples could be applied to data management.
And that’s where I did a double-take, because 1968 < 1970. Sure enough, Footnote #1 in Codd’s seminal paper is to Childs’ 1968 work. Indeed, Childs’ paper is the only predecessor Codd acknowledges as having significant portions of his idea.
I’m far from convinced that “Extended set theory” has much to offer versus the standard relational model. But that debate quite aside — Childs’ original achievement doesn’t get the credit it deserves.
| Categories: Analytics, Database management systems | 3 Comments |
Disputed history of the term Business Intelligence
According to Computerworld, Howard Dresner coined the term business intelligence in 1989 at Gartner Group. That seems odd, since a week before that story appeared Howard told me and a couple of other folks that he and his colleagues coined the term, not when he worked at Gartner, but previously when he worked at DEC.
Either way, it’s been established that Howard and his colleagues were several decades late; the term was first coined no later than the late 1950s. Whether anybody much used it in the interim is, of course, quite a different matter: I recall terms like decision support and executive information systems (EIS), but not “business intelligence” before the time frame in which Howard claims to have (re)introduced it.
By the way — that “Monash BI” link is NOT to anything I wrote. It’s something associated with Monash University, on the other side of the planet.
| Categories: Analytics | 5 Comments |