Business Intelligence Companies: Objects of Desire

Another business intelligence specialist has been acquired, and this time Oracle wasn’t the company opening its wallet. It’s time for Business Objects to say goodbye to its independence. The buyer is SAP AG. The big question: What does the deal mean for Cognos, MicroStrategy and SAS — three of the larger business intelligence companies that remain independent.

SAP is paying $6.4 billion for Business Objects. The move is a clear indication that SAP knows it can’t rely purely on organic growth as it battles Oracle in the applications market.

The VAR Guy can’t help but wonder: Will the SAP/Business Objects combo force smaller BI rivals to reconsider their independence? Here are some potential answers:

1. Cognos: The Canadian software company is now roughly a $1 billion operation, and in September announced a $339 million deal to acquire analytics specialist Applix. The VAR Guy spent some time consulting with Cognos in 2005 and 2006, and the company seemed to prefer to remain independent at the time. Cognos’s corporate culture is the opposite of Oracle’s, and a combo between the two companies seems highly unlikely.

2. Microstrategy: You can’t trust anything The VAR Guy says about Microstrategy. During the dot-com boom, he was high on the company but an accounting issue caused Microstrategy shares to tank. The VAR Guy never forgave the company — but should have. Microstrategy shares are more than 10 times more valuable today then they were five years ago.

3. SAS Institute: The privately held BI provider enjoyed serious channel success over the past year. SAS had planned to host a partner summit in August but then postponed the conference and Channel Chief Miles Mahoney left the company. The VAR Guy wonders: Did SAS cancel the event to save money in preparation for a potential takeover? That’s a stretch by The VAR Guy to be sure. But SAS’s silence in recent months makes you wonder: Will the privately held company march forward on its own — or seek a business combo? Hmmm. It’s time to call says for an update.

In the meantime, Oracle and SAS are putting plenty of pressure on independent BI companies.