SAP, Business Objects Deal Leaves Market in Turmoil

SAP's announcement on Sunday [Oct. 7] that it plans to acquire business intelligence software vendor Business Objects for $6.8 billion has left the software industry in turmoil with conflicting prognostications coming from industry watchers and investors alike. I commented in my blog that the question remains whether SAP will continue developing Business Objects as a separate unit or whether BO will become just a part of the SAP gorilla organization.

Todays eWeek article discusses whether Business Objects will be tightly integrated into Netweaver and this could become a problem for Business Objects customers in the long run. Forrester analyst Ray Wang says that Business Objects clients should ask half a dozen questions from SAP:

"Will Business Objects users be forced on to NetWeaver in the long run? Can users ensure that they do not have to use NetWeaver? Will key management change and who will replace them? What impact will the acquisition have on post Business Objects XI releases? Does being a "separate company" in the SAP group work like the way the TomorrowNow works (theoretically, with no sharing of data or technology between the companies)? And how will SAP continue to support non-SAP users?"

Aberdeen Group analyst David Hatch is also saying that there are lots of Business Objects clients currently asking very had questions specifically as Business Objects has acquired eight companies in the past three years. These are Inxight Software, Cartesis, nSite, ALG Software, Firstlogic, Infommersion, Medience, and SRC.As I stated in my previous blogs, I believe Microsoft and other vendors such as Microstrategy and smaller ISV's will benefit from this turmoil.

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