Denis’ Blog

Late 2007 rumors raised about a possible acquisition of SAP by Microsoft. The two companies denied. Would such an acquisition make sense? Is it the time to think about it again?

Well, this deal would make a lot of sense:

• It would consolidate the Sharepoint growth, sharepoint being a very exciting front end for corporate SAP
• It would accelerate Office 2007 adoption, for the same reasons
• It could accelerate SAP adoption in the SMB market, a key market nowadays. Leveraging SAP and Officce 2007 to boost SaaS for SMB is a viable option.
• For the three previous reasons, it would offer new growth opportunities while creating a quite unique value proposition
• The two companies have been collaborating for years, and a merger would have a chance to be successful
• It would put pressure on IBM, Oracle & RedHat on enterprise servers for SAP installations

Of course there are also good reasons for this operation not to happen. The corporate market is maybe not the most important nowadays for Microsoft, and Microsoft could have other strategic bets.

So. What do you think? Will it happen?

IBM announced today the acquisition of Cognos. It has been a long time rumor, since Cognos was the obvious missing link in the BI offer of IBM. IBM and Cognos has been long term partners and the acquisition of BO by SAP has probably accelerated the deal.

What is really interesting is that this deal is closing the loop: no more pure player in the Business Intelligence field. Well, almost. Informatica will be the last one (if acquired). No more proprietary software vendors. Even if their offer is very young and immature, I am eager to see how will Pentaho or Greenplum benefits from that convergence?

The software market has been concentrating around the TOP 4: IBM, SAP, Microsoft & Oracle. They are now ruling the IT field. It is pretty sure for everyone that the open source pure players will not change that. I am not convinced. The market is more and more commoditized. The Top 4 will have to sacrifice sooner or later their cash caws: application server, Core ERP, CRM, databases, portal. Let’s see how they will handle that.

Rumors have been circulating since 2002 that HP would buy BEA. Since I like risks, I’ve bet that SAP would buy BEA by 2005. I was wrong. SAP did not bought them. Not sure they need BEA anymore. But HP does. BEA market capitalization is ~5 Billions US dollars. HP is flying at ~120B US$. With the premium, that’s a 5% dilution at max. BEA has great products HP do not have: Portal, ESB, BPM, Web 2.0 server side solutions. So I was wrong. HP will buy BEA by the end of 2007. New bet. 2 beers on it.