Teradata revenue soars

Company increases revenue 75% in three-and-a-half years through research and development, corporate partnerships

Tags: Data warehouseDatacentreTeradata Corporation (www.teradata.com)
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Teradata revenue soars
By  Georgina Enzer Published  April 14, 2011

Teradata has increased its revenue from $1.7bn in 2007, when it split off from parent company NCR Corporation, to $1.9bn in 2010.

"It has been three-and-a-half years since Teradata was reborn and I am proud to say the Teradata team has done extremely well since Teradata became an independent company.

"When we spun off we had 5,500 employees and through the downturn we kept hiring, now we have close to 8,000 employees, almost a 40% increase," said Mike Koehler, president and CEO of Teradata.

In 2010, the company saw a revenue growth of 13%. Teradata has given a guiding estimate of revenue increases for 2011 of between 12% and 14%.

Prior to 2008, Teradata had only one data warehousing product in the market, but with continued heavy investment in research and development, the company has added four more platforms, many with first-to-market innovations, according to Koehler.

These platforms are workload specific, purpose built platforms to address different types of data warehousing environments.

The company has also been investing in its consulting services.

"Teradata has the largest warehousing consulting service in the world, we have 3,500 consultants, we have grown this number close to 30% over the last three-and-a-half years and this is key to the benefit for our customers to optimise and get the most use in value out of their data warehouse investments," said Koehler.

Teradata is further investing in corporate partnerships and customer teams, which have increased 30% in number since 2008. Both continue to be major revenue drivers.

"These investments have resulted in new customer trends and new customer growth. 2010 was our best year in eight to nine years in terms of new customers coming to Teradata and the number of customers won was up 40% for 2010 versus 2009," said Koehler.

Four key things the company has been able to achieve since it split off from NCR, according to Koehler are; the company has been able to extend its lead in data warehousing as per the Gartner Magic Quadrant, second, with the acquisition of Aprimo, Teradata is now the leader in integrated marketing, third, Teradata was named by Ethispehere as one of the world's most ethical companies two years in a row and fourth, Teradata is ranked number seven on a list of the most strategic IT vendors out of the top ten.

"The other companies that were awarded in the top ten in terms of size were ten to 50 times the size of Teradata and a lot of companies that did not make the top ten were ten to 50 times the size of Teradata. Our customers were so vocal we made it into the top ten," he said.

"We want it to be our objective for our customers to be the most strategic investment in IT. We will never be the largest, we are just focused on a couple of things; warehousing and integrated marketing management, but we want to be the best at what we do."

According to Teradata, competing on analytics will become more and more important for companies going forward. The companies using analytics the most are the top performers and this will continue in the future.

Koehler says the new challenge for companies is the analytics challenge and the explosion of data.

"With the complexity of all this explosion of data comes opportunity, opportunity for better analytics and more insight, doing it better than your competitors, I would also argue that if not done right, it is a cost problem. When you think about all this data that is coming at corporations today if it is not correctly used and no value is gained out of it, it costs more, just to operate as you are today and absorbing all this additional data, so these are opportunities and are potentially challenges," he said

The IDC says that by 2020 the amount of data processed by companies will be four times greater than it is today. If companies do not take advantage of this data, it is going to be a huge cost challenge to get the data right and to take advantage of it, according to Teradata.

"When we look at data and how you transform it into wisdom, there are several key areas we have to go after with our customers. One of them is a core data strategy is needed to get the right analytic foundation, all data is not created equal. The data needs to get rationalised. Is there a value in integrating this data and centralising it with other data? Is there relevance of this data for other organisations? How often is the data used? These are some of the questions we need to ask about how do we build a data foundation that optimises getting better business intelligence," said Koehler.

Another key process is to rationalise the data gathered and understand the user and business requirements. If all data gathered by a company is listed as mission critical, then the data warehousing environment will be very expensive.

"Not every user needs real time information or data, sometimes it is fine if it is days old, sometimes if it is fine if it is weeks old. It is all about right time data having the right time," said Koehler.

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