Business Objects to Buy Crystal Decisions -- Redmondmag.com

Business Objects to Buy Crystal Decisions

By Scott Bekker
07/23/2003

Two major business intelligence vendors whose products are used heavily on Windows platforms announced a major merger this month. Business Objects will acquire privately-held Crystal Decisions for about $820 million in a deal the two parties expect will close near the end of 2003.

Business Objects is among the largest business intelligence vendors with products that provide ad hoc query, reporting and analysis capabilities for power users and dashboard, scorecard and enterprise performance management capabilities for executives.

Crystal Decisions, once known as Seagate Software, sells the ubiquitous Crystal Reports enterprise reporting and report authoring software with 14 million licenses shipped and integration into hundreds of products and solutions.

"With this combination, we will seize the opportunity to take a leadership position in the BI market. The two companies are not only successful leaders in their space but have extremely complementary businesses, across many dimensions: Product capabilities, distribution channels, international coverage, and skillset," Bernard Liautaud, Business Objects chairman and CEO, said in a statement.

For the 12 months ending March 31, Business Objects had $466 million in revenues and $38 million in profits and Crystal Decisions had $270 million in revenues and $28 million in profits.

While the combination has potential, Microsoft, one of Crystal Decisions' 350 partners, will present a major challenge. Microsoft is bundling enterprise reporting capabilities into its SQL Server database. The move follows the inclusion of an OLAP engine for free with the cost of SQL Server 7.0 and the addition of data mining capabilities in SQL Server 2000.

By adding OLAP to SQL Server a few years ago, Microsoft contributed to the troubles of another mega-merger in the business intelligence industry between Arbor and Hyperion. As Microsoft was preparing SQL Server 7.0 for release with an OLAP engine included, Hyperion and Arbor merged to form what should have been the largest OLAP vendor. But the companies never succeeded in getting their revenues to add up, and steadily lost share to Microsoft after the merger.

About the Author

Scott Bekker is editor in chief of Redmond Channel Partner magazine.

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