Intelligent Enterprise

Reported over the weekend by Reuters was that Business Objects had hired Goldman Sachs to find a buyer for the billion-dollar-plus business intelligence (BI) provider.

Is Business Objects, which has recently made acquisitions in financial management, data quality, search and other technologies to extend their portfolio of platform and application capabilities, ready to be consolidated? Is this report just more of the continued discussions of market consolidation in BI market and finding the best return for shareholders or just accidental leaks from normal business operations? Will HP, IBM or SAP get more serious about the BI market to compete against Cognos, Microsoft and Oracle? No comment of course from official channels at Business Objects, but clearly something is brewing.

It's difficult to know what Business Objects’ status is, but there is a clear understanding that the enterprise software segment called BI has great opportunity for expansion and profits. Gaining more rapid access to information to understand and manage the business is a high investment priority for organizations. Even with this growth, BI is still a small fraction of the technology spend in organizations and has yet to reach broad workforce deployments. More is possible in supplier growth and is why we see market consolidation like this one to further the channels of distribution to reach you.

Is the BI market ready for more mergers and acquisitions? Maybe, there has already been enough for most of you to deal with in the last year. For you, this may mean you will experience the slower product release cycles and innovation typical of large software providers. Business Objects is looking to mitigate these risks by providing BI on Demand as announced yesterday. The On Demand approach might have you caught in the middle of a major transformation as this new approach to BI simplifies technology adoption. The deployment approach of on-premise BI technologies continues to be consolidated forcing organizations like yours to re-evaluate the variety of approaches. Tread carefully, as clearly the rumors of Business Objects being on the market to be sold might come true and then effect your investments as they could rapidly become a branded product line of some larger enterprise software company.

Let me know your thoughts.

Mark Smith is CEO And Senior Vice President of Research at Ventana Research. Write to him at mark.smith@ventanaresearch.com.

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