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The Road to Business Intelligence

August 2, 2016

In 1965, Gordon Moore wrote an article for an electronics industry magazine where he noticed that computer memory manufacturers were doubling the number of memory cells that they could fabricate on a single silicon chip about every two years. This translated to the fact that every two years, you could get about twice as much computing power for the same amount of dollars as you could get two years before.  This is the hallmark of exponential growth.

Moore’s Law has been in operation now for over 50 years and still holds true. That is why the supercomputers we carry around in our pockets and purses, called phones, have the capabilities that they do.

Back when Gordon Moore made his famous observation, there were no iPhones, tablets, or personal computers. At that time a computer filled an entire room much bigger than the room you are probably in right now.

One of the most common tasks in business in those days, as it is now, was to do financial analysis with an electronic spreadsheet. I worked with a company that offered such a spreadsheet for IBM mainframe computers. They rented it to their clients for $25,000 a month, and that was in the days when $25,000 was worth many times more than it is now.

Personal computers appeared on the scene in 1975, but were considered to be toys by IBM and the other mainframe manufacturers of the day, and were ignored. In many ways, they were toys because the programs that early hobbyists wrote for them were not particularly business oriented.

That changed in 1979 when Dan Bricklin’s Software Arts released VisiCalc for the Apple II. The program was immediately recognized as so valuable, that it not only justified its purchase price—all by itself, it justified the purchase of the computer that it ran on. It was the world’s first killer app.

After a brief time in the sun, VisiCalc was superseded by Lotus 1-2-3, which had more features and ran on the IBM PC. Lotus 1-2-3 was later displaced by Microsoft Excel, which ran under the new Windows operating system as well as on the Apple Macintosh. Excel is still at the top of the spreadsheet heap today, but the market has evolved.

Today, organizations have data stored in a variety of formats that have been created by different programs. In many cases, they want to pull data from different sources, combine it in a meaningful way, and present the result in a way that brings out trends and emphasizes what is important. This field is called Business Intelligence or BI. A number of companies worldwide have been active in BI for many years. SAP is one example and SAS is another.

BI products have tended to be quite costly, earning high profit margins for their purveyors. However, Moore’s law has now become a factor in the BI marketplace. Microsoft has recently evolved extensions to its ubiquitous Excel spreadsheet product into a new cloud-based BI product called Power BI.

One way to look at Moore’s law is to say that every two years you get twice as much computing power for the same cost. There is another way, however. That is to say that every two years you get the same power for half the cost. The ultimate result of that way of looking at it is that commodities that are subject to Moore’s Law eventually become free. This is essentially true of hard disk drives, where you can now get a drive holding trillions of bytes for well under $100. It has also come to business intelligence in the form of Microsoft’s Power BI, which is literally free. No cost whatsoever. Nada.

Microsoft is using Power BI as a lure to pull businesses into their ecosystem of products. Power BI is free, but once you have it, you are going to want the other Microsoft products that are tightly connected to it.

Moore’s Law rolls on far beyond what Gordon Moore or anyone else at that time ever thought it would. We today are the beneficiaries. If you run a business of any kind today, take a look at Microsoft’s Power BI. The price is right.

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