Oracle announced an interesting acquisition today by purchasing data quality vendor Silver Creek Systems for an undisclosed sum. While the data quality market remains diverse and fragmented, the vast majority of vendors focus on customer data quality i.e. validating customer name and address data, which is a problem common to most companies but is also fairly well understood. Silver Creek, by contrast, was one of the few vendors that had focused on product data. This is a thornier problem since, although customer data is quite well structured with limited numbers of attributes (address lines, post code etc), product data typically appears in an unstructured form, often with a single part having dozens or even hundreds of attributes (just think about how many components go into even a fairly simple device such as a mobile phone). Consequently, establishing high quality product data requires the parsing of often unstructured files, and different approaches to matching. Many companies tackle the problem by manually going through files and matching them up to product catalogues, but this is error-prone and time consuming; indeed a mini industry has sprung up in India of companies applying low cost labour to this problem.
Silver Creek had carved out a niche by enabling the establishment of semantic rules to be set up by business domain experts, which could then be applied to a parsed file of product data (as opposed to a pattern-based approach). In principle the semantic rules engine could be "trained", with a domain expert working in sample data and correcting the rules engine's initial attempts. Certainly it can be seen that having a set of rules that can be applied automatically to a file is more efficient doing such a task manually, even though, inevitably, human intervention will be required in some cases; indeed Silver Creek added a "Governance Studio" to its product line to help data stewards deal with such exceptions. The company had specialised in the retail, distribution, manufacturing and healthcare industries. Its customers include Cardinal Health, Staples, Corporate Express and Emerson Power.
The fit for Oracle is a clear one, and indeed the company already had an OEM partnership with Silver Creek Systems. It is highly complementary to Oracle's MDM Product Hub, and to Oracle's broader supply chain and e-commerce offerings. According to a conversation I had with a Silver Creek executive, the vast majority of the key Silver Creek staff are moving across to Oracle. This acquisition is unlikely to affect Oracle's existing partnership with Trillium for customer data quality, since customer and product data quality are entirely different beasts.
More interesting will be the effect on other Silver Creek partners, such as Heiler and Siperian, who currently partner with Silver Creek, but who compete directly with Oracle's MDM product hub. According to my source some partners were "considering their options" but others were quite comfortable with the new ownership. It is too early to tell whether this causes some re-alignment.
Another potential impact will be on the few software vendors which specialise in product data quality, in particular, Datactics and Inquera. Other MDM platform vendors with a strong focus on product data may decide they want their own product data quality offering rather than hoping that their chosen partners don't get snapped up by a rival. Since there is a very limited choice of alternatives in the product data quality world, this could make companies with proven technologies in this area more valuable.