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Business Objects' plans to acquire Cartesis: Industry reactions

Customers, analysts, experts and vendors sound off about Business Objects' plans for Cartesis and the convergence of business intelligence and performance management.

Last week, Business Objects announced plans to acquire Cartesis underlining a trend toward the convergence of business intelligence (BI) and business performance management (BPM) also known as corporate performance management or enterprise performance management. It's the latest move in the rapidly evolving performance management market, which recently saw Oracle's acquisition of Hyperion and Microsoft's announcement of Performance Point Server last year. It's also further affirmation of Stamford, Conn.-based analyst firm Gartner Inc.'s predictions of more integrated BI and performance management platforms.

But the acquisition raises new questions: Will a niche performance management market survive? How will Business Objects rationalize the product overlap between its platform and the Cartesis products? How will the new ownership affect the Cartesis product roadmap, and customers? polled a variety of customers, analysts, experts and vendors to find out.

Cartesis and Business Objects' customer David Wein, group chief accountant with London-based United Business Media Plc

"The acquisition means that Cartesis is a bigger company and they're likely to have more development, which will be of use to us. Cartesis must have been acquired because they have a good product, and you'd expect that Business Objects would just want that product to be improved further. And, [Business Objects is] able to offer products to a wider audience. We're involved in a few users groups in the UK and we feel that the more users there are, the better, because it brings the product a lot further."

Business intelligence analyst Boris Evelson, principal analyst with Cambridge, Mass.-based Forrester Research Inc.

"This is a continuing saga of consolidation in the performance management space. BI and performance are becoming inseparable, so most of the BI vendors are doing something in this space. Business Objects already acquired SRC Software Inc. [in August 2005], a financial budgeting and planning solution, but was weak in financial consolidation. Cartesis is considered a leader in the financial consolidation space, hence the reason for the transaction. I used to participate in recommending and planning exactly such transactions. They take many months to come up with, plan and execute. So, this started well before Oracle and Hyperion was announced. No, it was not a copy cat [of the Oracle and Hyperion deal], but part of the same trend. [I'm] curious to know about SRC/Cartesis's product overlap and roadmap."

BI and performance management analyst, John Hagerty, vice president with Boston-based AMR Research Inc. (Comments excerpted from the April 26, 2007 research note, BI/PM Market Consolidation Continues: Business Objects To Acquire Cartesis.)

"There is some overlap [between Cartesis' products and] existing Business Objects assets, specifically Business Objects Planning. The existing planning product, however, is heavy on planning and lighter on the consolidations piece, and the Cartesis position is just the opposite. While there will be areas where Business Objects must clarify its product position, this overlap is not a big one.

The overlaps need to be rationalized and/or justified, technology stacks need to be integrated and enabled, and development teams must mesh quickly. Business Objects has grown rapidly the past few years by making acquisitions and integrating them quickly. Its experience entwining the original Business Objects with competitor Crystal Decisions has given the company an acquisition blueprint. In fact, it can be considered a Business Objects core competency."

Consultant Rick Sherman, founder of Athena IT, a Stow-Mass. based firm specializing in assessment and training services

"Corporate performance management [CPM] is a growing market, but it is still relatively immature. Almost two thirds of the money spent on CPM is in services rather than software. One of the inhibitors to CPM, from a software solution perspective, is that most companies offering solutions have business process specific applications, in some cases a lot of them, but they are not really enterprise-wide in scope. A company cannot get all their CPM needs from one vendor and that has put a constraint on wide adoption. This phenomena is spurring CPM vendors to expand their offerings either organically (developed internally) but more often then not they have done so by acquisition.

For more on business intelligence and performance management
Learn what experts said after the Oracle-Hyperion acquisition announcement

Find out why one expert thinks that performance management, not business intelligence, will be pervasive

Business Objects previously bought CPM providers SRC and ALG Software to jumpstart its CPM offering. Cartesis expands on this theme. Cartesis itself acquired INEA and Advance Info Systems to speed along its CPM offerings.

Niche CPM vendors are not likely to stay independent as the CPM market expands and then inevitably matures. They will need to grow and then be acquired for their technology to endure in any substantial way. That doesn't mean that there won't be many CPM vendors left in the years to come, but just like the BI and ETL marketplace, there is only a certain size that these companies can grow to when facing software behemoths."

Performance management vendor Phil Wilmington, chief executive officer of Stamford, Conn.-based OutlookSoft Corp.

"The announcement further validates the strength of the performance management market, and demonstrates that the direction of performance management will be driven by applications, not BI tools."

Business intelligence and performance management vendor Mychelle Mollot, vice president of market strategy and strategic communications with Ottawa-based Cognos Inc.

"Cartesis and SRC customers ponder an uncertain future with significant product/technology overlap at many levels -- and with no clear path to reconciliation. (e.g., what happens to SRC? What happens to INEA?) Technology to be integrated includes: three consolidation engines, three planning engines, multiple reporting and analysis engines. Cartesis has a very small North American presence in terms of customers and field-facing staff (less than 10% of license revenue and only 10 people in North American operations.) Cartesis has a .NET architecture only so they are limited to Microsoft platforms."

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