SAP, Business Objects unveil first joint products

IDG News Service - SAP and Business Objects yesterday announced the first joint products from their merger, although plans to tightly integrate the product lines of the two firms will take longer to achieve.

SAP AG in October agreed to pay $6.8 billion for the business intelligence vendor. The deal has already been approved by 87% of Business Objects SA's shareholders, said CEO Henning Kagermann at a press conference on Wednesday. The acquisition is expected to close later in the first quarter, according to the SAP Web site.

Business Objects will become a division of SAP that will be headed by its current CEO, John Schwarz. The plan is to integrate its analytics technology more tightly with SAP's business applications, but also keep selling stand-alone products that work with other vendors' software, Schwarz said.

"While we'll clearly align ourselves to SAP, we are equally committed to non-SAP customers, platforms and environments," Schwarz said. "Our intention is to have a business intelligence solution on top of Oracle that's better than Oracle's own business intelligence solution."

The companies announced nine software packages that will go on sale this month -- including Financial Performance Management, Governance, Risk and Compliance, and Visualization and Reporting -- that in some cases combine products from both companies.

The financial package, for example, includes strategy management and planning tools from SAP and financial consolidation and profit-management tools from Business Objects, said Doug Merritt, head of SAP's business user division.

Those products were already sold separately, and the new packages don't involve any significant integration work, he said. They are intended to give the companies' sales teams something to go out and sell -- although customers should also see a pricing benefit compared with buying the products separately, Schwarz added.

The long-term goal is to integrate the companies' software more tightly to form what Kagermann called a "closed loop." The idea is that SAP users, acting on information from Business Objects' analytics tools, will be able to more quickly adjust underlying business processes running in SAP's NetWeaver middleware, Kagermann said.

SAP will also offer Business Objects' tools as part of its new suite of on-demand business applications for medium-size enterprises, called Business ByDesign. The team developing Business ByDesign "will be able to pick the best from the Business Objects portfolio and merge it into Business ByDesign," Kagermann said.

Business Objects already offers hosted versions of its products, and had 70,000 subscribers when the SAP deal was announced, Schwarz said. The job of merging the BI tools into Business ByDesign has not yet started, however, he said.

SAP aimed to have about 100 Business ByDesign customers by the end of 2007, a modest target, and its goal for 2008 is "to prove that we can build a profitable volume business," Kagermann said.