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SOA vendors beefing up BI offerings

BI brings SOA home to business users, who may be skeptical or uninformed about the value of service-orientation, which explains why SOA vendors are scrambling for BI technology, analysts say.

The importance of business intelligence (BI) to service-oriented architecture (SOA) vendors was highlighted this month by deals by IBM and SAP AG involving Business Objects SA.

SOA has largely been a technology proposition, despite attempts to position it to the business, and the vendors see BI capabilities as a means of appealing more to a business audience.
Neil Macehiter
Research DirectorMacehiter Ward-Dutton

IBM and SAP have placed BI bets on Business Objects, explains James Kobielus, principal analyst for data management at Current Analysis LLC., who is covering the convergence of SOA and BI. SAP made a friendly takeover bid for Business Objects this month, but promised this past week to maintain the independence of the vendor. That declaration of independence allows IBM to continue OEMing Business Objects technology, including the venerable Crystal Reports, as the BI component in its SOA product line.

Meanwhile, other SOA vendors including Oracle Corp. and its takeover target BEA Systems Inc. follow their own paths to BI, Kobielus said.

The importance of BI within SOA was highlighted in this month's publication of a Forrester Research Inc. report on the role it will play along with business process management (BPM) and business rules in a new generation of dynamic applications. The report written by Forrester analysts John R. Rymer and Connie Moore states: "BI adds ways to score, rank, and otherwise analyze information as it flows through applications" in an SOA environment.

Kobielus sees BI as the business side goal for SOA because it provides the business users with ways of making sense of the data service-oriented applications are designed to provide.

"I define SOA as a paradigm for maximizing the sharing, reuse and interoperability of corporate resources over a network or distributed environment," he explained. "Within the broad definition of SOA one of the most critical corporate resources that you want to share is data, intelligence, metrics. In terms of reusing and sharing, the frontline of SOA is BI. That's where the data, the metrics, the operational information gets shared and presented to the business users."

Thus BI is what Kobielus calls "a core component in a full-fledged SOA infrastructure," and that is why SOA vendors are scrambling to incorporate it into their products.

"The SOA vendors are all saying we need strong BI in our portfolio," he said.

Neil Macehiter, research director at Macehiter Ward-Dutton, said his research indicates that information access and delivery is one of the early benefits in SOA use cases.

"Information access and delivery is a means to an end and business intelligence is one such end," Macehiter said. In his view, this accounts for the major SOA vendors moving to either acquire BI vendors or partner with them.

Rather than growing their own BI technology, most of the SOA vendors are seeking to get it through either acquisitions or partnerships, Kobielus said.

The ménage a trios involving IBM, SAP and Business Objects is one example of both approaches. The need of SOA vendors to broaden their overall suites providing a comprehensive range of BI and analytics is why SAP is acquiring Business Objects, Kobielus said. SAP already has Netweaver BI, but it has not been marketed outside the core SAP users, the analyst said.

SAP's acquisition of Business Objects is also a move designed to fend off its arch rival Oracle, which bought BI vender Hyperionn for $3.3 billion earlier this year, Kobelius said. He added the plan to allow Business Objects to operate independently is part of a tightrope act designed to not offend IBM.

"For SAP to really have a chance against Oracle going forward in the SOA space, SAP needed a BI mega brand on the order of Business Objects for their portfolio," he said.

At Business Objects Insight Americas conference in Orlando, FL this past week, Kobielus said SAP made it clear that Business Objects will retain its independence. To accentuate that, Business Objects announced a further partnership to bundle its Crystal Reports products with IBM.

Meanwhile, IBM appears content to OEM the Business Objects technology and appears to have no plans to acquire a BI vendor or develop the technology themselves, Kobielus said.

"IBM made it explicit last week at their show [IBM Information On Demand 2007 in Las Vegas] that they don't intend themselves to go into the BI arena, but rather they will continue to partner with all the best of breed including Business Objects," he said.

While IBM does have some BI capabilities in its data warehousing suite, the heavy lifting is done with Business Objects, Kobielus explained.

"For the most part when they sell you their data warehousing suite, what is in the box actually is Business Objects," he said. "They made that very explicit several months ago that for BI, IBM will provide you with Business Objects."

While IBM has a previously announced partnership with Cognos Inc., another pure play BI vendor, Kobielus said that based on what IBM executives said this past week they do not intend to buy Cognos. As long as SAP abides by its promise to keep Business Object independent, he does not expect the acquisition by SAP to cause problems for IBM.

The riddle wrapped in an enigma in the SOA vendor chase for BI is what Oracle is doing with the technology it acquired with Hyperion. Kobielus noted that Oracle has not been forthcoming with its plans for Hyperion, but he anticipates that more details may become available at Oracle OpenWorld 2007 in San Francisco next month.

With Hyperion, Oracle has a wealth of BI technology, the analyst said.

"It's not like Oracle didn't have BI," Kobielus said. "Oracle acquired Siebel a couple years ago and Siebel had a strong BI product called Siebel Analytics. The DNA of Siebel Analytics is the heart of the new Oracle BI Enterprise Edition. Then Oracle acquires Hyperion. Hyperion is very strong in BI. They are one of the market makers with their OLAP [Online analytical processing] server, and they took the market further with financial analytics and corporate performance management applications. This helps Oracle build up and deepen its BI and corporate performance management stack."

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Beyond Oracle, the other SOA vendors, including Oracle's takeover target BEA are more in the stage of dipping their toes in the BI waters, Kobielus said.

"BEA recently release BEA WebLogic Event Server for complex event processing (CEP)," he said. "BEA already has an enterprise information integration (EII) product in AquaLogic that integrates nicely into Microsoft Excel to provide users with a logically integrated view of heterogeneous data over the EII fabric provided by the AquaLogic data services platform."

Kobielus said another SOA vendor, Software AG/webMethods, is yet to enter the BI arena and may do so through partnerships similar to what IBM does, rather than through acquisitions.

Macehiter concluded that the drive to incorporate BI into SOA is driven partly by its appeal to business users who may still view SOA as an IT initiative.

"SOA has largely been a technology proposition, despite attempts to position it to the business, and the vendors see BI capabilities as a means of appealing more to a business audience looking to drive business transformation," he said.

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