Tuesday, March 6

BO denied; Hyperion now Oracle

In a previous post, it was rumoured that Oracle would purchase Business Objects to improve it's BI offering through M&A.

That intel was inaccurate.

Hyperion was the object of Oracle's desires as The Data Doghouse explains. And with hindsight, I see how Oracle/Hyperion makes more sense. Acquiring Hyperion gives Oracle deeper customer relationships with financial departments where they can expand their ERP. And Hyperion will sit Oracle next to SAP clients (supposedly because many SAP clients use Hyperion for their BI) for further the competition between SAP and Oracle.

The Data Doghouse shares 5 Q&As about Oracle, Hyperion, and the competition with SAP.

This acquisition will almost for sure heat up the M&A fever for other BI vendors. Although I'm not sure it will be Business Objects or Cognos. The question I keep asking myself is, "What do they have to offer a large ERP vendor?" There are some big ERP players that want to enhance their BI offerings but what BI vendor has the track record for large, complex businesses with large volumes of data?

To further substantiate the fever of M&A, the Wall Street Journal published an article "Update: Oracle Buy Could Spur New M&A In Business Intel Mkt".

1 comment:

Rick Sherman said...

Tom, (this is a response to your comment from DataDoghouse.com)

Oracle’s acquisition of Hyperion puts pressure on two ERP vendors: SAP and Microsoft. I think both should consider purchasing a BI pure-play but I am not sure if they will. SAP likes to either offer capabilities through partnerships or if they feel they need their offering they seem to prefer to build it themselves. The classic NIH (not invented here) syndrome. Microsoft’s offerings are focused on SMB market and more tools-oriented than what the BI-pure-plays offer. They already bought ProClarity but we are still waiting to see its strategic fit (It is a good product we just don’t know if Microsoft will leverage it well.) In addition, Microsoft seems to be building out Office and SharePoint to offer BI capabilities. Microsoft may prefer to purchase a “smaller” BI pure-play that leverages their platform – Microsoft SQL Server, Office, Analysis/Report Services, etc. – and enables their customers to effectively and economically deploy BI better than their current tools oriented approach (but that’s to-be-determined.)

I am not sure if other ERP vendors such as Infor, Lawson. The Sage Group or SunGard are really interested in purchasing a BI pure-play vendor. They are more likely to partner with BI vendors rather than acquire them.

The most likely acquirers are IBM and HP with SAP, Microsoft, Sun and EMC also being possibilities.

The most likely companies to be acquired: Cognos, BusinessObjects and MicroStrategy. I have included MicroStrategy based on its full range of functionality and its ability to handle large, complex environments along with a strong pedigree of customers. I am not sure if BusinessObjects will play hard to get wit regards to its acquisition price.

There are several other smaller BI companies that have excellent technology that may be acquired if the acquiring company does not like the price tag of the “majors”. But remember your are buying more than technology here and that’s why the price would be higher.