SAP Closes Business Objects Deal, Announces 9 Packages

The challenge for SAP now is to assure customers that its BI platform will remain open to everyone.

SAP has closed its $6.7 billion acquisition of Business Objects, formally folding the company into its Business User unit, which will operate as a separate subsidiary under the SAP umbrella.

The group will be led by Business Objects CEO Jonathan Schwarz with the dual mission of carrying on Schwarz's development work in business intelligence integrating Business Objects' software into SAP's stack.

With the deal closing Jan. 16, the goal now is to ensure customers - combined there are about 60,000 of them - and potential customers that SAP's BI software is open to any environment.

"While we'll clearly align ourselves to SAP, we are equally committed to non-SAP customers, platforms and environments," Schwarz said during a Jan. 16 press conference. "Our intention is to have a business intelligence solution on top of Oracle that's better than Oracle's own business intelligence solution."

While Business Objects built its business on being open to any environment - with the ability to abstract data from any source - analysts sounded a warning bell that SAP may look to move Business Objects' users to its NetWeaver integration and development platform. SAP officials said the reality couldn't be further from the truth.

Doug Merritt, head of SAP's Business User group, said in an interview with eWEEK that the key differentiating aspect of a successful software company versus a not-so-successful company is the ability to create an abstraction layer that enables an agnostic environment.

"Even though people say ABAP [SAP's programming language] is proprietary, PeopleScript [PeopleSoft's programming language] is proprietary; PLSQL [Procedural Language/Structured Query Language] and Oracle are proprietary as well," said Merritt. "The reality of NetWeaver is it's able to operate against any database, any network framework. That approach is what made Siebel and other application vendors like us successful. My belief is it's better to tune your energy on building an integration layer that provides significantly more power for customer's ability to leverage their existing investments and not feel locked in."

Analysts have also been skeptical of SAP's ability to quickly and efficiently integrate Business Objects into the larger SAP group, given SAP's history of buying smaller "tuck-in" acquisitions. It's a criticism SAP is well aware of and ready to shake off. As a first show of due diligence, SAP announced Jan. 16 nine new software packages that combine its and Business Objects' software.

The jointly developed packages include financial performance management; governance, risk and compliance; visualization and reporting; data integration and data quality management; enterprise query, reporting and analysis; and master data services. Not to alienate the SMB (small and mid-size business) sector that SAP is heavily courting, the company also said it is rolling out three new BI-based offerings for its SAP Business All-in-One that include BusinessObjects Edge Standard, Crystal Reports Server and BusinessObjects Edge Series.

The packages rely heavily on the work already done in Merritt's group that concentrates on FPM and GRC, as well as a new class of applications that allow users to capture random, chaotic processes. The packages were already sold separately by both companies and don't involve any significant integration work. The idea really is to enable the combined sales teams to hit the ground running.