IBM’s purchase of Ottawa-based business intelligence (BI) provider Cognos this week for $4.9-billion (U.S.) is being treated by some as the end of independent BI firms as we know them. While there are still a few around – including SAS Inc. and Information Builders – with Oracle buying Hyperion earlier this year and SAP acquiring Business Objects a few weeks ago, they are becoming a rare breed. These kinds of companies are sometimes called “standalone” players because they focus on one thing (in this case, BI), while companies such as SAP and IBM offer all kinds of other software that work together.

BI is used by executives to do everything from figuring out whether to diversify their business to deciding where a product should be placed on a store shelf. It’s nothing to fool with. That’s why a number of industry experts have been offering their thoughts to help guide users through future purchasing decisions.

The case for independence

Timo Elliott, who writes the BI Questions blog, went through many of the arguments against standalone BI after Oracle bought Hyperion, but concluded the focus and openness of niche firms were still worth the money. “BI is the final layer between business people and the millions of dollars you have invested in your information systems,” he wrote. “A small difference in BI effectiveness can have a large effect on the overall return on IT investment.”

The case for consolidation

William McKnight, an information management expert who contributes to beyeNETWORK.com, suggested the SAP-Business Objects deal was a sign of things to come. “The business intelligence market continues to be absorbed into enterprise software lines,” he wrote. “Enterprise software players now seek an end-to-end story and eventually so will end clients. I’ve talked a lot about ‘BI Frameworks’ – those handful of companies that sell a complete BI story. Maybe we should be talking about enterprise frameworks like those from Oracle, SAP, Microsoft and IBM.”

It’s all one big family

There is always the thought that buying a brand name or an independent won’t really make much difference, says Frank Scavo, who discussed the Cognos deal on The Enterprise System Spectator. By necessity, these vendors have to make sure their products interoperate. “Like Hyperion and Business Objects, Cognos is used by organizations with a variety of enterprise systems. In fact, many smaller [enterprise resource planning] vendors have partnered with Cognos in the past to provide data warehouse and business intelligence functionality for their solutions,” he points out. “For example, Lawson, MAPICS (now part of Infor), and ROI (now part of Epicor) all use Cognos as part of their total solution. Even SAP has a partnership with Cognos as part of its business warehouse offering."