Consolidation fever fuels business intelligence land grab

Another wave of sudden consolidations has hit the business intelligence and analytics world.

Multinational applications and service companies are duking it out with pure-play veterans to snap up smaller analytics companies.

In what can only be described as a coincidence, two of the most notable mergers happened on July 21, both in all-cash deals.

Analytics and dashboard stalwart Business Objects has snared privately-held financial planning and performance management software vendor SRC Software for $US100 million in an effort to further bolster its capabilities after buying and integrating Crystal Decisions.

The deal represents an assault on the traditional financials market of arch rival Cognos, a move that has seen technology and equities analysts predict the two vendors will soon start encroaching on each other's turf.

Meanwhile, Indian services giant Satyam has acquired Singaporean analytics toolmaker and noted spreadsheet driller Knowledge Dynamics for $US5.4 million, a move the applications and services shop says will see Knowledge Dynamics' 75 staff absorbed by Satyam's 1300 strong data warehousing and business intelligence group.

Industry players are also predicting the analytics shopping spree will continue unabated over the next 12 months.

Having seen her retail analytics acquired by private pure-play BI vendor SAS in 2003, MarketMax CEO Lori Schafer says major applications players such as Oracle and SAP are now buying up both tools and analytics applications vendors in an effort to drive both capability and market share.

Specifically, Schafer points to Oracle's purchase of Retek in April this year, followed swiftly by retail analytics vendor Profit Logic on July 9.

"There's a land grab going on, especially in retail analytics. The market has just been going gangbusters. Oracle is trying to buy its way in, while SAP is trying to build its way in - but SAP will buy," Schafer said.

Schafer said Oracle's purchase of ProfitLogic was a trigger likely to compel SAP to respond in kind, but declined to name specific targets saying it would be inappropriate to name names.

Similarly, SAP is also staying quiet about its plans and would not comment if it is considering buying retail technology players like JDA, which makes retail supply chain automation and optimization software.

Meanwhile, Oracle is also attacking the supply chain and is understood to be close to launching a JD Edwards-based ERP module for the Australian wine industry, which it hopes to export worldwide.

Sources close to the project, which has been merrily nicknamed "the grog module" by beverage insiders, say the project is now back on track having been delayed after passing through the hands of three vendors in less than 18 months.

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