With the continuing focus on acquisitions and the results reducing the BI market to only one independent player, i asked my colleague Jon Gibbs for his views. Here it is below. Do not hesitate to comment and Jon Gibbs will answer you:
With the recent news of SAP acquiring Business Objects after their previous acquisitions of Pilot Software and Outlooksoft, and hot on the heals of the Oracle acquisitions of Hyperion for its planning, budgeting and financial consolidation capabilities, we’re clearly in a period of significant Vendor consolidation in the BI space. It’s going to leave a lot of people considering what this means to their BI strategy, so what do I think we can make of this activity?
Let’s recap on what the true business value of business intelligence (BI) can be found in the ability to efficiently gather useful information from a diversity of both internal as well as external information sources and by exploiting this information both internally and with ecosystem partners and customers to improve mutual performance. As a result, it’s only natural that ERP vendors (historically process focused) want to widen their portfolio to include information centric capabilities, something they’ve been trying to do for a number of years, but without any significant success.
While SAP BI (Business Warehouse) have been gaining ground in the SAP customer base, Business Objects have a major focus on SAP integration with their Titan release which will potentially put pressure on other ETL products used with SAP. While there is overlap with other SAP acquisitions and products, the step change that Business Objects brings should, on balance, be good for SAP. For Business Objects, the end to the speculation regarding their future ownership should enable them to confirm their development roadmap and drive them forward.
BI/CPM vendors often have similar products built upon the same types of technology. Therefore there are little distinguishing characteristics between the various vendors. It is therefore more than likely that technology is not the driving force behind this recent storm of BI consolidation. Keeping or gaining share of this dynamic, rapidly growing and increasingly important market segment is a key driver for these vendors.
My summary? The importance of unlocking an organisation’s data is finally coming of age – a sentiment further reinforced by the Teradata and SAS strategic undertaking to effectively pool resources. Where this leaves Cognos is still for debate, but there is widespread speculation that they will be next. That means a certain amount of the functionality from previously separate BI applications can and will move to being part of the larger Enterprise Applications suites, and this is probably an effective move.
From a technology standpoint there is a case to be made that future innovation comes from small companies focusing on niches, such as: strategy & implementation tools, meta- and master data, advanced visualization, text mining, search or business activity monitoring. The obvious point is that as these niches start to become mainstream, these too will be candidates for acquisition, may be we should consider this as an inevitable and useful long term effect that allows consolidation in our own portfolios and operations?