IBM is increasing the scope of its existing relationship with business intelligence (BI) software vendor Business Objects with a particular focus on midmarket customers.
The two companies announced Thursday an expansion of their current partnership in place for more than 12 years into a worldwide strategic alliance where IBM and Business Objects will collaborate more closely on joint development projects and tighter product integration.
IBM already has strong relationships in place with other BI players, notably Cognos and SAS Institute. IBM announced an escalation of its partnership with Cognos around service-oriented architecture (SOA) back in March.
Allen Pancoast, vice president of Business Objects' IBM Alliance, characterized the enhanced relationship as an "umbrella agreement" bringing together the "bits and pieces" the two companies have worked on together in the past. IBM already resells Business Objects' software in Japan and through its IBM Global Services arm and embeds the vendor's technology in some of its products, for instance, IBM's Rational Application Developer includes Business Objects' Crystal Reports software.
"I look at it as IBM adding the last major piece missing in its BI portfolio," Pancoast said. "We're at parity with IBM's Cognos relationship."
"This announcement does not impact existing strategic alliances," Mark Hanny, IBM's vice president of independent software vendor alliances, wrote in an e-mail comment. "All of our strategic alliances are intended to address a specific client need or market opportunity, whether it's for a specific vertical industry, technology, or geographic region."
While most enterprises have already adopted BI software, many midmarket customers have yet to embrace the technology and rely only on basic reporting software, not analytics, according to Pancoast. He defined the midmarket as any business employing between 100 and 1,000 staff and reporting a maximum annual revenue of $1 billion.
The two vendors plan to focus their joint midmarket efforts on a number of industries, notably financial services, government, health-care, life sciences and retail.
Business Objects is also looking forward to taking advantage of IBM's global reach, in particular, hoping to win more BI customers in both the Chinese and Eastern European markets including Russia, Pancoast said.
As an independent vendor in a consolidating market, speculation ebbs and flows on a regular basis whether Business Objects will end up being acquired, with the most likely purchasers IBM or Oracle.
"We've all seen the rumors," Pancoast said. "They haven't been substantiated by anyone with IBM or anyone with Business Objects." Pointing to the number of relationships IBM has established with the different BI players, he believes IBM's unlikely to acquire Business Objects or one of its rivals. "Why would they mess that up and pick up us or one of the others?" Pancoast asked.
The companies have already collaborated to boost the headcount at the Business Objects Centre of Competency based at IBM's Pacific Development Centre in Burnaby, Canada. The operation now employs more than 300 software engineers to help Business Objects customers migrate to the latest versions of the vendor's products.
IBM and Business Objects will also work on developing future BI offerings, particularly in relation to BI Web services components necessary in the deployment of SOAs, Pancoast said.
Sign up to receive Business Resource Alerts
Recommend This
