Business Objects Acquires Inxight – the shape of things to come

May 30, 2007

Business Objects Acquires Inxight – the shape of things to come

On May 22, 2007 Business Objects announced its intention to acquire Inxight, a leading provider of text analytics technology.  The deal is expected to close in July.  This announcement comes on the heels of Reuters’ notice, earlier this month, to acquire ClearForest, another text analytics vendor.   So, what is the significance of the Inxight acquisition and what does it bode for the broader text analytics market, in general?

Inxight, the largest pure play text analytics vendor, focuses on federated search, extraction, and visualization technologies.  Inxight positions its technology as a bridge between search and information intelligence because it has the ability to read language and structure it.  Inxight’s products provide the ability to 1) acquire information, via their federated search capability, 2) structure it, via their text analytics capabilities, 3)validate and store the information utilizing whatever datastore the client wants, and then 4)visualize and explore it,  using their visualization capabilities or plugging into a BI or statistical analysis package.

Full spectrum Business Intelligence?

Business Object’s goal in acquiring Inxight is to provide “Full Spectrum Business Intelligence”.  This means it wants to address both structured and unstructured information, from a search as well as a BI perspective.  Business Objects understands the obvious strategic value of merging structured and unstructured data together for use with a BI tool.  But it is not just about marrying structured and unstructured information.  Business Objects, with Inxight, is further expanding the definition of business intelligence by including search, as a means to extract intelligence.  This isn’t just about using search to access BI data.  The vision appears to be a new generation of Business Intelligence that incorporates unstructured data into the data mix and utilizes enhanced search to as part of the overall BI equation.

There are still a number of unanswered questions about just how and when Inxight’s technology will be integrated into Business Objects software and the solutions that will be offered. The partnerships that Business Objects has established with some of the other pure-play text analytics vendors will certainly erode over time.  While Business Objects would like to maintain certain OEM relationships, it remains to be seen what happens to certain agreements that Inxight currently has in place with vendors like SAS.

The acquisition is significant because it puts Business Objects out in front of its core competitors in terms of expanding the boundaries of the kind of information and analysis business intelligence should be dealing with.  Unstructured data represents a huge chunk of information that companies need to gain insight to.  The majority of companies planning to implement text analytics are looking to incorporate the technology into their BI solution.  It is a natural step for BI vendors to integrate text analytics more deeply into their applications.   The acquisition also puts a stake in the ground in terms of Search and where search fits in the intelligence stack.

And for the Market?

What does the acquisition mean for the text analytics market?  Text analytics is in many respects an enabling technology.  As such, it needs to be as transparent as possible.  Hurwitz & Associates expects the inevitable consolidation to continue as vendors provide this functionality as part of their product offerings.  With the latest acquisition, only a handful of pure-play text analytics vendors remain. BI providers, along with search and even content management vendors will no doubt be looking at the remaining players with interest. 

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