Salesforce Hopes To Ride Analytics Wave With New Business Intelligence Service will unveil a new analytics service tomorrow morning they have dubbed Wave. The product will be introduced by CEO Marc Benioff at the company’s Dreamforce customer conference in San Francisco, but according to a Salesforce spokesperson, it is already available in the AppExchange now.

It was one of the worst kept secrets in technology as just about everyone I talked to knew about this even before today’s release, but the general consensus is that this is something that Salesforce had to do, even though the market is crowded with competitors and they are very late to the game.

As one CEO told me, it was a gaping hole in the Salesforce product family and they needed to fill it. All that said, Wave is a graphical tool for viewing business analytics in an attractive and visual way on mobile devices and larger PC screens, but like many of Salesforce’s services it will be rolled out slowly over time, and according to Forrester Analyst Boris Evelson, while it’s impressive in its own way, it has ways to go before it can compete with established business intelligence vendors.

Make no mistake, this is a big market and a company like Salesforce wants some of it, but how large that piece will be is going to depend on many factors including how well they actually implement the product. Pretty demos always look nice, but it really depends on what happens when the rubber meets the road. Salesforce claimed when they showed this tool to business users, they were giddy because it was so easy to use, but the competition is fierce and Salesforce is just getting started.

Still, IDC analyst Dan Vesset says you can’t dismiss Salesforce easily in what he estimates is a $10B market. In a market that large, he says, there is certainly room for Salesforce. “I think it can compete. Obviously, first and foremost it’s for existing customers. They now have an option to get their BI/analytics needs met by the same vendor instead of having to seek out another product. That will be attractive to some (not all),” he wrote in an email.

In the demo I saw, you can slice and dice the data to create different views as you would expect and create a variety of connections between data, but it still uses standard database language like “join” and has database-style labels, and you still needed to build the connections to view the data. In other words, although it didn’t require IT involvement to use it, neither did it appear to be dead simple, and users would still need some training or knowledge to use it effectively.

The company emphasized in the demo that they wanted to make this a consumer-like experience, and they actually brought in game designers to make it more fun to use the product. While they succeeded to an extent, it’s important to remember this is still 1.0 technology and it’s going to require refinement over time.

They also brought up the slew of third-parties who could be involved in this analytics play with everyone from OEMs to consultants to third-party developers. For a product that’s supposed to be so easy to use, it seems as though they’ve lined up a lot of outside help. To be fair though, they say the third parties will help customers connect to external data sources in other systems inside and outside the company and build more complex apps on top of the platform.

Salesforce obviously wants a piece of the BI market badly and they are going to make a strong push to get it, but just because Salesforce enters the market, doesn’t mean it can have its way with it. If you recall, everyone thought Salesforce would blow up the enterprise social market when they introduced Chatter a few years ago, and it never really happened. Like everyone else in this space, it will need to earn its marketshare and that will take work and commitment. Today’s announcement is just the first step.

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