The King of BI: Business Objects vs Cognos

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Content Copyright © 2006 Bloor. All Rights Reserved.

When people talk BI, they inevitably compare the two biggest
best-of-breed players: Business Objects and Cognos. But who really
is the best? What differentiates one from another? How do they
measure up?

In Bloor’s latest report on the
CPM market
, Cognos is one of four leading enterprise
applications vendors in the top ‘Enterprise CPM’
category. Business Objects is in the somewhat less exciting Finance
CPM category. This is indicative of each organisation’s view of
innovation. Cognos likes to build exciting new products to satisfy
customer needs. Business Objects likes to squeeze every last bit of
profit out of its existing product set, and then acquire to gain
fast entry to an emerging market in growth. One mark for innovation
and bravery to Cognos.

Business Objects has the best Query and Reporting available
today. Period. Hence it won a Gold Award for this in Bloor’s

BI report
. In licence revenues it outsells Cognos by 1.5: 1.0.
One mark for core product superiority to Business Objects.

For 30,000 Business Objects 5x and 6x customers, it is a
tortuous and expensive path to upgrade to the Business Objects XI
BI platform as it was built on the Crystal Enterprise v10
architecture. 5x and 6x customers are “encouraged” to
upgrade to the XI platform as bug fixes will stop in 2007 and
support will be discontinued by the end of 2008. Meanwhile, Cognos
7 will be supported to December 2010. Cognos is more in line with
the lifetime support that is now offered to Oracle and Microsoft
customers. In addition, for six months to one year, Cognos 7
customers can use modules of Cognos 8 in tandem with Cognos 7
modules for a phased migration. One mark for customer-centricity to

Both suppliers have difficulties in upgrading their user bases
to their new BI platforms. Customers say Cognos 8 is too complex
and that Business Objects XI is not yet a ‘whole
product’ solution, despite what Business Objects say about
Release 2. Customers say their existing products work pretty well,
so why change? The customers of both suppliers are really saying
“deliver me more customer value rather than upgrade service
and support packs, please”.

What about customer loyalty? Well, Business Objects seem to win
out here. It is difficult to ‘turn over’ a Business
Objects customer. Their account management is slicker and better
executed, and they rarely lose customers to competition, despite
the limitations of their product set. They seem to do just enough.
However, sales teams can be fickle. Both vendors have been down on
their target sales headcount, and both have been suffering from
salesperson churn. One mark for account management to Business

And long-term supplier stability? The rumours still persist that
Oracle will buy Business Objects and IBM will buy Cognos. I feel
sure both would entertain suitors. BI licence software revenues are
flat, and although both vendors are growing nicely their highly
profitable services businesses (after all, they both have
‘Global Services’ businesses now), the investment
community still sees licence growth as the key driver of
shareholder value for the longer term.

The market is still unclear about whether any best-of-breed BI
vendor will make it outside the BI niche in the broader enterprise
applications market where they will come head-to-head with the
likes of SAP, Oracle, and Microsoft, who are over 10 times their
size. Time will tell. For the moment though, Cognos has the edge,
but only just.