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Microsoft Piles BI on the Stack

There have probably been happier occasions for Stephen Elop, head of Microsoft's Business Division, than this week's state-of-the-company address in front of the undoubtedly nervous folks from Morgan Stanley and other likely ledge-dwelling financial types.

But Elop performed admirably, it seems, answering questions that were likely beyond his (no doubt considerable) pay grade. After all, Elop runs Microsoft's Business Division -- think Office, Dynamics and unified communications -- and while that's a pretty big chunk of Microsoft, it's not the whole company, and he's not really a financial executive. Still, the up-against-the-Wall Streeters wanted to know how Microsoft would cut costs and make money online in a -- say it with us, everybody -- down economy.

Elop had a lot to say about that, as Kurt Mackie details here. We could go in quite a few directions with this, but we're going to focus on one little bit about business intelligence that's right in Elop's wheelhouse. From Kurt's story:

"Another focus that Microsoft has reconsidered is business intelligence, where Microsoft has tried to 'democratize' the segment via SharePoint and Excel. Microsoft pulled back its Performance Point Server as a separate product and consolidated its features with SharePoint. That decision represents a retrenchment from Microsoft's vertical competition with companies such as Cognos and Business Objects, Elop explained."

We're sure Elop meant to say IBM and SAP, respective owners of Cognos and Business Objects. And so we see, at least in part, the fulfillment of our little prophecy that BI as we used to know it is pretty close to being dead. Well, it's not actually dead; in fact, in terms of functionality, it's very much alive. It's just not standing alone anymore.

Oh, sure, we know that there are still BI vendors out there that are large-ish (we see you, SAS) and smaller, and some of them are doing really cool things. But the big guns -- Hyperion, Cognos, BO -- are part of other companies' arsenals now, and the disappearance of PerformancePoint as a standalone product represents yet another step in the commoditization of BI. It's part of the stack now, folded into SharePoint or embedded in Dynamics ERP suites or into Oracle's or SAP's or IBM's bigger products.

We're not saying that's necessarily a bad thing, either, unless the swallowing nearly whole of BI by huge vendors leads to a slowdown in innovation in the category. Right now, we don't really know whether it has or not -- and, as we said, some independents are still out there doing cool stuff.

Cool stuff, though, might not be enough to save BI as a difference-maker technology. It's now becoming a standard part of a larger enterprise deployment, a commodity rather than a differentiator. Where once it was a potential competitive advantage -- almost a luxury at the prices some vendors charged -- partners should be aware that it's now something IT folks are likely to expect to have rather than invest in.

And that's OK, mostly, as in the long-run native integration is almost always preferable to gluing systems together. We're fairly sure that Stephen Elop would agree. In fact, he'd probably love to talk about it and get all those nervous investor types off his back. Who wouldn't right now?

What's your take on where BI is headed? Send it to [email protected].

Posted by Lee Pender on March 04, 2009


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