MicroStrategy sent out the following take on the SAP Acquisition of Business Objects today:

SAP recently announced its plans to acquire Business Objects for $6.8 Billion. As a leading provider of business intelligence (BI) software, MicroStrategy has closely followed this announcement. We would like to share our perspectives on the impact of this acquisition on the BI market.

A Shakeout in the BI Market

We believe that this acquisition is a continuation of a shakeout process in the BI market space. Although Business Objects has grown to considerable size through a long series of acquisitions, the acquisitions have masked some fundamental weaknesses in its technology offerings. Business Objects’ BI products are fragmented, lacking both scalability and integration, making them inappropriate for many applications in the new generation of enterprise BI.

MicroStrategy is well positioned for success in the enterprise BI market as a leading pure-play BI vendor. Our niche is “industrial-strength” BI, ideally suited for large organizations with vast amounts of data, large user populations, and the most sophisticated analytics. We have maintained our consistent focus on this market, and we continue to relentlessly enhance our organic technology to provide a high level of service to our customers.

Important Questions to Ask About This Acquisition

1. Why was Business Objects so eager to be acquired? We believe that Business Objects needed to be acquired because it had accumulated a large collection of non-integrated technologies in a market where organic technical integration is essential for providing enterprise BI solutions.
2. Did SAP rush into the purchase of Business Objects? Some analysts suggest that SAP rushed into the purchase of Business Objects and paid a premium price, even though Business Objects warned that Q3 revenues and earnings would be well below Wall Street estimates. One must wonder whether the acquisition was a defensive move by SAP to prevent a competitor from acquiring Business Objects.
3. Will Business Objects’ customers be forced to undergo even more major migrations? Unless SAP maintains Business Objects purely as a portfolio investment, it is likely that Business Objects’ architecture will change to improve integration with the SAP suite.
4. Will Business Objects’ technology become even less applicable for data warehouses? As SAP influences the Business Objects’ product set to be more aligned with the needs of the SAP BI architecture, the architecture and design priorities of Business Objects’ products will likely move away from data warehousing.
5. How will Business Objects and SAP reconcile their overlapping technologies? There is significant overlap within SAP and Business Objects’ product suites. Customers with products that are undergoing integration will face painful migrations. Customers with products that are not being integrated face the likelihood that SAP will slow down development on those products, and ultimately “sunset” them.

There are No Questions About MicroStrategy’s Commitment to Our Customers

MicroStrategy is now the second largest independent BI provider in the market. As an independent BI provider, we listen only to our customers for direction. Our customers comprise some of the most successful companies in the world, with BI deployed across their enterprises. We are committed to delivering the best-engineered BI technology for our customers – helping them run their businesses more efficiently, more profitably, with lower risk, and with faster growth.

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