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Business Objects Goes Deep; Its Competitors Go Wide

Depending on how you look at it, Business Objects either threw down a gauntlet or manufactured a heck of a controversy. You decide which.

• By Stephen Swoyer
• February 22, 2006

Depending on how you look at it, Business Objects SA either threw down a gauntlet to its competitors or manufactured a heck of a controversy.

That seems to be the takeaway from the company’s ~$70 million acquisition of data quality specialist Firstlogic Inc. Gauntlet boosters say Business Objects can now credibly trumpet a highly vertical BI stack that runs the gamut from data integration and data management (with its Data Integrator ETL tool, existing data modeling tool, and new Firstlogic data quality assets) through bread-and-butter reporting (where Business Objects’ Crystal brand is a recognized best-of-breed.) Manufactured controversy boosters, on the other hand, say it’s not at all clear that customers even want a highly vertical BI stack in the first place. In this respect, they argue, Business Objects’ Firstlogic gambit bears a striking resemblance to what historian Daniel Boorstin once called a “pseudo event.”

Philip Russom, senior manager of research and services with TDWI, says there’s something to recommend both viewpoints. True, Cognos Inc., Hyperion Solutions Corp., and MicroStrategy Corp. have failed to develop credible data integration strategies. Cognos, for its part, does have an ETL tool—viz., DecisionStream, which it acquired nearly eight years ago—and has also partnered with enterprise information integration (EII) specialist Composite Software, but hasn’t focused nearly as much on data integration as Business Objects. (In addition to Firstlogic, Business Objects also acquired former ETL player Acta Software and EII specialist Medience.)

“Actuate has a more modern data integration strategy than most BI vendors. Leaders in this regard are Business Objects and SAS—[which are] both focused on the BI front end—[along with] possibly IBM, Microsoft, and Oracle,” although the latter vendors tend to focus on the BI back end, Russom says.

The rub, he says, is that the highly vertical BI stack—at least as envisioned by Business Objects—might be a product vision in search of a market: users haven’t yet had a chance to vote with their IT budgets, and (at this point, anyway) it’s not clear going deep (i.e., vertical) is the answer for a critical mass of users.

That’s a ball Mark LaRow, vice president of products for MicroStrategy, is happy to pick up and run with. “Data integration is a gigantic issue in all of BI. That’s why IBM and Oracle and Microsoft, in particular, but secondarily Sybase and Teradata—each one of those vendors has their own ETL strategy, their own data cleansing strategy,” he says.

MicroStrategy can join data from multiple sources in its BI tool, but --with respect to the heavy lifting of data integration or (what Business Objects might call) enterprise information management—LaRow says that’s a job best left to the database vendors. “From our take and from the market’s take, the database vendors are truly the people who are heavyweight enough to solve the problem of data integration. It’s probably not the purview of the BI vendors to try to solve these problems,” he comments.

There’s another wrinkle here, too. Business Objects is pursuing an EIM strategy that includes data integration, data federation, and data quality components. This means it is perforce competing with the likes of IBM, Microsoft, Oracle, SAP, and other application powerhouses. Indeed, Business Objects bundles a version of the open-source MySQL database with Unix and Linux versions of its BI software, which has the potential to further complicate its relations with the big relational database vendors.

This is a point that MicroStrategy, Cognos, and other Business Objects competitors have been quick to seize upon. “We believe this acquisition makes Business Objects more directly competitive with IBM, SAP, Oracle, Microsoft, and Informatica—vendors who already have sizeable leads in delivering infrastructure solutions and are typically already established as one of a few strategic infrastructure investments at most companies,” claims Mychelle Mallot, vice-president of market strategy with Cognos.

Rich Clayton, vice president of product marketing with Hyperion, concurs.

“Overall, I think what customers are asking for is integration, and the question I think the market has to sort out and will do over the next 12 months is what needs to be integrated, and why. Our perception is that the data management, data integration, and particularly data quality are parts that are more aligned with what they [the relational database vendors] do best,” he comments. “While I’m certain that there’s a high applicability for data quality in BI solutions—it’s a critical part, certainly—our question is, are customers going to go to a business intelligence vendor for that, or are they more likely to go to an IBM, or an Oracle, for that type of solution? My sense is that [the latter] is the case.”

Of course, Hyperion has a data quality-like practice of its own—namely, its Master Data Management (MDM) product (based on technology Hyperion acquired last year from the former Razza Solutions). So why isn’t what’s good for the goose (Hyperion) also good for the gander?

Clayton says that while MDM does incorporate elements of data cleansing, MDM as productized by Hyperion is a very different proposition. “We think there’s a pretty big misperception of what the focus [of MDM] is. There’s a data management problem—making certain that IBM is the same customer in all your customer systems, and that supplier A is the same across all of your supplier systems—that’s part of the data quality world, but it’s not part of the problem we’re solving,” he comments. “The problem we’re trying to solve is help IT link with the business and manage the reporting rollups of reference information [across business domains].”

Even as Business Objects goes deep, its competitors are going wide, stressing their partner-friendliness and overall benignity with respect to the relational database and enterprise applications powers-that-be.

“Enterprise organizations have multiple vertically integrated stacks from application vendors, database vendors and data management vendors that all include data quality. So, no, we don't believe that a vertically integrated stack is better. We believe that a horizontal performance management stack that is open to all of the vertically integrated stacks is what is best for the customer from a BI perspective,” says Cognos’ Mollot.