Anatomy of the Deal
Microsoft-Hyperion Solutions Corp., April 25, 2006
Hyperion Solutions Corp. is a leader in what it calls business
performance management software, a category it claims to have pioneered.
(Analyst firm Gartner Inc. calls the category corporate performance
management.) Hyperion's applications combine financial management
capabilities with business intelligence (BI) functionality.
Based in Santa Clara, Calif., Hyperion is a Microsoft Global ISV
partner that participates in beta programs. The company has also
long competed with Microsoft in the online analytical processing
(OLAP) space and is actually a competitor in the BI space as well.
Hyperion generated revenues of $703 million for its fiscal year
ending June 30, 2005.
BI applications cut through SQL code, giving non-technical
users easy access to real-time reports on key metrics within a company
or industry without requiring IT people to intervene in the report-creation
process. This link-up will integrate SQL Server 2005 technologies
with Hyperion System 9 BI+, the BI component of Hyperion's system.
It gives Hyperion customers access to Microsoft's SQL Database Management
System (DBMS) through a Hyperion front-end interface and also lets
users access Hyperion's analytics functions through a Microsoft
Customers will be able to use SQL Server Reporting Services, Microsoft's
front-end reporting engine, to directly access data stored in Hyperion
System 9 BI+ Essbase Analytics. It'll work the other way around,
too: Users will also be able to access SQL Server Analysis Services
data using Hyperion System 9 BI+ and display SQL reports in the
Hyperion System 9 Workspace front-end interface. System 9 will use
SQL Server Integration Services to move SQL data from a Microsoft
environment to a Hyperion environment.
BI is a highly competitive sector that includes stars such
as Hyperion, Ottawa-based Cognos Inc. and Business Objects SA, based
in Levallois-Perret, France and San Jose, Calif. Gartner predicts
that BI will be a $3 billion market by 2009. Microsoft itself is
also a significant BI player and made further inroads into the space
in April, when it bought ProClarity Corp., a Boise, Idaho-based
Microsoft Gold Certified Partner and maker of BI tools.
How Partners Will Benefit
This deal will create a powerful combination for partners,
who will be able to sell Hyperion's well-regarded BI application
tightly integrated with increasingly pervasive SQL technologies.
Customers have demanded a combination of SQL and Hyperion, says
Tobin Gilman, Hyperion's senior director of product marketing.
James Kobielus, principal analyst for data management at Washington,
D.C.-based Current Analysis Inc., agrees. "The fact that Hyperion
has a strong partnership with Microsoft means that Hyperion is aware
that customers are asking for tighter integration with SQL server,"
How Users Will Benefit
The pairing is especially beneficial for mutual customers
of the two companies, who will now be able to go beyond simply using
System 9 BI+ to perform SQL queries and reports.
How Hyperion Will Benefit
The partnership gives Hyperion critical access to the SQL
Server DBMS. Kobelius notes that Hyperion doesn't have a DBMS of
its own. "Hyperion is regarded as being a very strong best-of-breed
player," he says.
"It's just a matter of Hyperion, a superior BI suite, wanting
to hook up with one of the leading platform players, which has a
DBMS at its core."
How Microsoft Will Benefit
Microsoft, despite having a strong BI offering, wants to
demonstrate that it's serious about moving into the BI space, Kobielus
says. A partnership with Hyperion demonstrates just that and also
signals that the company believes that BI is an important technology.
Once Redmond has customers' attention, Kobielus says, it will be
able to sell more of its own BI applications and push strategic
partners' wares less often.
"[Microsoft] will de-emphasize strategic partnerships going
forward in favor of its own tools," he says.