In the past three years, heavy competition from open-source software has forced suppliers to lower prices, despite rising input costs and growing demand.
Los Angeles, CA (PRWEB) September 03, 2014
Data mining software has a buyer power score of 4.2 out of 5, representing a high level of negotiation power for buyers. The rising sophistication and capabilities of open-source software (i.e. software with a source code that has been released to the public) have provided buyers a free alternative to paid offerings, which has offset opposing trends in the market to give buyers high leverage. “Open-source software has risen strongly in popularity over the past three years,” says IBISWorld procurement analyst Dale Schmidt. “This free software has provided buyers a solid alternative to the often-expensive proprietary software, or closed-source software, that market suppliers offer, greatly increasing buyer power.”
Not all buyers can use open-source data mining software, though, either because it struggles with the data tasks the buyer requires or because the buyer's IT department does not have the time or resources to assemble the relevant code. Still, even buyers that cannot take advantage of open-source software benefit from its existence. “Suppliers of paid services have steadily cut prices to better compete with the free software and are now more likely to offer data mining software in bundled discounts with their other offerings,” adds Schmidt.
Despite high buyer power, suppliers retain some power in the market. There are no true substitutes for data mining software and the market is highly concentrated. As a result, buyers that need to purchase proprietary software have no alternatives and a limited number of suppliers to choose from. In addition, the costs of switching suppliers are moderate, which means buyers should be confident in their supplier selection or risk incurring costs if they have to switch to a different supplier. SAS and SPSS (acquired by IBM in 2009) have long been the market's largest vendors. For more information, visit IBISWorld’s Data Mining Software procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of data mining software. Data mining software is used to discover patterns in very large data sets in order to make informed business decisions. It is primarily used by companies that are involved with selling or marketing a high volume of consumer products. This report excludes database software.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
Buying Lead Time
Key RFP Elements
Buyer Power Factors
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IBISWorld is one of the world's leading publishers of business intelligence, specializing in Industry research and Procurement research. Since 1971, IBISWorld has provided thoroughly researched, accurate and current business information. With an extensive online portfolio, valued for its depth and scope, IBISWorld’s procurement research reports equip clients with the insight necessary to make better purchasing decisions, faster. Headquartered in Los Angeles, IBISWorld Procurement serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.