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Business Objects Launches Midmarket Drive With New Crystal Decisions Line

Business Objects introduced on Monday a new product line tailored for midmarket customers. Partners praised the move, saying it will help them win customers that would otherwise be priced out of investing in the business intelligence vendor's wares.

"The partners have been looking for something like this for several years," said Paul Grill, CEO of InfoSol, a Phoenix-based Business Objects specialist. "They're putting together here a bundle that makes sense, with the best products bundled together at a very attractive price. When they are combined with additional vertical solutions, it will be an extremely interesting offering to the midmarket."

But partners were taken aback by one potential stumbling block with the new software: its name. Business Objects has dubbed the new line Crystal Decisions, pressing back into service the name of the midmarket software developer it bought in 2003. The name frustrated partners who will need to battle the perception that the new line is tied to Crystal Reports, the popular reporting application Business Objects inherited from Crystal Decisions. While reporting is part of the functionality the new Crystal Decisions line offers, it's a broader product that includes essentially all of the features in the enterprise Business Objects XI business intelligence platform.

"It is a shame that they had an opportunity here to create something new and exciting and they make such an obvious mistake with the naming," complained one reseller. Several other partners echoed his reservations about the naming. One partner praised the decision, hoping that Business Objects will be able to take advantage of Crystal Reports' ubiquity and strong reputation in the midmarket.

The new Crystal Decisions line is targeted at companies with less than $1 billon in annual revenue or fewer than 2,500 employees. The standard edition, shipping today in 12 languages, carries a starting price tag of $20,000 -- a fraction of the cost of Business Objects' enterprise BI platform, even though Crystal Decisions is built off the same code base as its enterprise sibling. The new software has single-server licensing and fewer configuration options, but its functionality is unchanged from Business Objects XI, according to Business Objects executives and partners.

Bob Vander Woude, vice president of sales and marketing at Soquel, Calif. solution provider Preferred Strategies, said the new line will help resellers close deals with customers who balked at paying six-figure sums for Business Objects enterprise platform.

"We've had multiple scenarios like that, but now we can go back and open doors," he said. "I've had two or three sales reps this morning that were reopening deals."

Business Objects executives say they want their channel partners to be the prime movers in serving midmarket customers. Compensation on the Crystal Decisions line will be channel neutral for Business Objects' direct sales, and services for the line will be provided almost entirely by partners, pledged Todd Rowe, Business Objects' general manager of worldwide midmarket business.

"Professional services in this market is the domain of partners, period," Rowe said.

The standard edition released today will be followed later this year by premium editions with additional features. The Crystal Decisions roll-out has been in the works for months, and 2,300 partners around the world have already been trained on the new software, according to Rowe.

Business Objects' midmarket push is part of an ongoing organizational overhaul led by John Schwarz, who took over as the company's CEO in late 2005. Rowe joined Business Objects last year, and partners say he's been the leader in getting the company to take action on their longstanding requests for a more competitive midmarket product offering.

"He's a make-it-happen guy," one reseller said.

Last year Business Objects changed its partner terms and cut partner margins on enterprise deals, a move that irked partners who felt herded into the midmarket. Still, partners said they're pleased that with Crystal Decisions, Business Objects is giving them what they need to compete aggressively in the space. The new line launch comes just a few months before Microsoft kicks into high gear efforts to boost its own share in the midmarket BI space. Its new BI platform, PerformancePoint Sever 2007, will ship this Spring with a list price of $20,000 per server and $195 per client access license.

Microsoft will be the primary competitor to Crystal Decisions, Rowe acknowledged. Partners say they're already feeling the heat.

"For the last year we've been having customers that look at it. At [Microsoft's] price point, you do yourself an injustice if you don't evaluate it," said Taylor Courtnay, vice president of sales at solutions provider Decision First, in Atlanta. But Courtnay hasn't lost any deals to Microsoft this past year, and he's optimistic the new midmarket line from Business Objects will help him preserve that track record.

"I think it'll be very popular with customers, especially in the lower midmarket," Courtnay said. "It'll be a chance to build an ROI before they have to commit to an enterprise-level purchase, if they should grow out to that."

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