“It was the best of times, it was the worst of times.” So said Dickens in his work The Tale of Two Cities. Like the English and French in the early 19th century, a sort of war is brewing in the tech world. This past week saw the IPO of another major player in data analysis – Cloudera, after the 2014 Hortonworks IPO. The event is particularly important because both companies are built on making business oriented partnerships within the Hadoop (https://hadoop.apache.org) software world. Hadoop is the open-source program that allows for large scale data analysis across clusters of computers, providing low risk of failure on individual machine applications. It has become the system of choice for large scale data management.
While the code has always been open source, the massive business applications for the software have caused some really serious players to jump into the marketplace, looking to produce spinoffs for business usage. Both Hortonworks and Cloudera are doing just that – seeking to provide systems that are business-friendly and still able to manage the massive volume of data that is now commonly being processed by business servers. The reality is that, with the exponential rise is video, social media systems, and widespread mobility, the old-school machines are simply not able to keep pace with the high-volume data usage that is now required to keep business moving. Hadoop (and the related software spinoffs) are providing usable solutions for this conundrum. Cloudera and Hortonworks are two of the three biggest players in this new and quickly expanding marketplace (the third is called MapR) and the reality is that these sorts of companies will keep cropping up as the usability of Hadoop continues to grow.
The issue at hand among stock traders is the valuation of Cloudera at more than three times the current price to sales ratio of Hortonworks. While their emphases are different, this shows that the market is still understanding the value of commoditizing Hadoop for the business world. Hortonworks is focusing more heavily on the consulting and training portions of the platform, while their rival has sought to capitalize on the nearly limitless potential of software around Hadoop. This direction shift has allowed Cloudera to expand its market without the inbuilt limits of direct links to the open source products themselves.
Regardless of how this newest IPO plays out, the reality is that Hadoop is here to stay as one of the most useful platforms around. The only question is which of the companies will come out on top. The time is right for businesses to begin utilizing the broad range of service options out there in order to capitalize on the burgeoning field. With more players entering the marketplace and the creative potential around Hadoop nearly limitless, it would be wise to sit up, take notice, and begin committing resources to the development of Hadoop platform functionality. Dickens was right in one sense, while the world took sides, the wise capitalized on both sides.