IBM Boosts Analytics Portfolio With Acquisition

The privately held Alphablox, based in Mountain View, Calif., provides a set of modular software components, akin to building blocks, that enable developers and solution providers to infuse new and existing applications with analytics capabilities. What's key about embedding this technology at the process or application level is that the data yielded from a metric such as "customer buying trends," for example, is made immediately available to other applications and users, according to Bill Wagstaff, CTO of Alphablox. The Alphablox middleware also allows a developer to customize how particular users see information.

IBM's strategy with Alphablox is twofold, according to Anant Jhingran, director of Business Intelligence and Distinguished Engineer in IBM's Silicon Valley Lab. The new technology eventually will be sold as an IBM-branded standalone product. Right away, however, IBM plans to begin embedding the BI functionality into a range of its software products.

The belief is that by making the BI functionality part of the IBM middleware stack, partners can invoke it when creating new apps or crafting a solution for customers.

"It is our belief that people want to extend applications with analytics," Jhingran says. "We have worked with our partners, who then take our middleware and build turnkey solutions. We build the platform and expect to work with ISVs and other BI tools partners to take it to next level."

Initially, Alphablox technology will be embedded in two IBM products. One is IBM's Data Warehouse Edition, which is part of Big Blue's broader BI platform. In this context, the Alphablox technology components will enable partners to build applications with inherent analytics capabilities. In addition, Alphablox technology will be embedded into WebSphere Business Integration Monitor to augment the product's process-integration capabilities with the ability to track, assess and diagnose the health and performance of processes.

Future plans call for Alphablox to be integrated into IBM's Rational toolset so that ISVs can build apps that have BI characteristics, IBM Lotus Workplace to extend analytics to the desktop and WebSphere Portal.

BI is one of the hottest areas of IT right now, seen as a competitive-edge software tool as companies seek ways to exploit mountains of data to assess and improve their business performance and spot positive and negative trends in the marketplace.

Alphablox deal is expected to close at the end of July; financial terms were not disclosed. Jhingran believes that the Alphablox capabilities give IBM a leg up on competitors like Microsoft, Oracle and Teradata. The acquisition is the 16th that IBM has made since 2001.

"IBM has had a well-developed business intelligence platform on the data side of their business. [Alphablox] allows IBM to move into the BI tools arena," says Philip Russom, principal analyst at Forrester Research.

Furthermore, Russom says, the acquisition should not upset IBM's current partnerships with BI vendors such as Cognos because Alphablox's technology is narrowly focused on tools.