IBM grabs Cognos

Acquisiition will help Big Blue strengthen its growing software portfolio

Written by Sara Yirrell

CRN, 13 Nov 2007

Industry consolidation has continued apace after IBM snapped up Cognos in an all-cash transaction worth $4.9bn.

The acquisition will help IBM strengthen its growing software portfolio, allowing it to push further into information integration, content and data management and business consulting services.

Steve Mills, senior vice president and group executive at IBM Software Group, said: “Customers are demanding complete solutions, not piece parts to enable real-time decision making. IBM has been providing business intelligence solutions for decades. Our broad set of capabilities from data warehousing to information integration and analytics, position us well for the changing business intelligence and performance management industry.”

“We choose Cognos because of its industry-leading technology based on open standards, which complements IBM’s service oriented architecture strategy.”
Helena Schwenk, senior analyst at Ovum said the acquisition came as little surprise.
“It is very little surprise to industry watchers that Cognos is the subject of an acquisition and even less surprising that IBM was the acquirer. IBM has been the obvious buyer of Cognos for quite sometime, the rumours started circulating when the two companies entered into a strategic relationship in early 2006 and intensified when SAP’s acquisition of Business Objects left IBM as the last of the major infrastructure players without a convincing business intelligence story.”

“So what next for the BI market?” she said. “Ongoing consolidation in the independent BI market has left a diminishing pool of potential acquirers and targets. Of those who might acquire Teradata, HP or even EMC could all feasibly be in the frame. However, the most likely of these is HP. The company has some gaping holes in its BI and data integration technology stack that could be significantly boosted by an acquisition and provide a nice complement to its fledgling Neoview data warehousing business. Of the remaining public pure play vendors the potential candidates could be Microstrategy, Panorama SPSS or Informatica. Given the heady market activity of the last few months a combination of one or more of these can not be ruled out.”