Can open source crack business intelligence?

On the heels of open source databases come business-intelligence tools, with smaller companies betting on open source practices to crack into that corner of the software market.

One such company, JasperSoft, is set to detail its plans to expand its portfolio with a suite of freely available server-based components for business intelligence. Last week, rival Pentaho released its own commercial-grade open source business intelligence tool set.

Several software companies are adopting open source software and business models in an effort to unseat entrenched suppliers. Open source databases, for example, are widely used, according to analysts.

The Jasper Intelligence product line will include a server for generating reports. In about a month, the company is expected to release a component for doing analysis and then a so-called ETL product later this year for moving data between different sources.

The Java-based server products will complement the company's existing open source product: JasperReports, for generating reports.

Business intelligence software - a collection of products tools for analysing business data such as sales records - is one area corporate customers continue to spend on, according to analysts' surveys. The segment is dominated by larger full-service companies, such as IBM, Oracle, and specialised vendors, such as Business Objects, Cognos, Hyperion and SAS.

JasperSoft's strategy is to undercut entrenched vendors on price with a simpler product, said Paul Doscher, president and CEO of the company. It is designing its product to appeal to developers, who can take the software and embed data analysis into applications they write, rather than try to sell directly to end users.

Doscher said: "The reason people don't use business intelligence now is because it's too complex and it involves interaction with a professional IT organisation. Open source allows developers to integrate [business intelligence] into an application."

JasperSoft, which estimates about 10,000 deployments of its software, intends to make money by charging for high-end versions of its open source tools and by offering support services.

Pentaho is another relatively young company taking the open source route to business intelligence. Last week, it released its own expanded suite of business intelligence tools.

Its latest products - Pentaho BI Suite Professional Edition and Pentaho Reporting Server Professional Edition - are extensions to the Pentaho BI open source project software.

The company intends to charge a licence fee for the high-end editions of its business-intelligence suite. It said the open source products contain about 90 per cent of the functionality of the closed-source versions.

Meanwhile, a number of vendors are participating in an Eclipse open source project: Business Intelligence and Reporting Tools, which was founded by Actuate.

Martin LaMonica writes for CNET News.com