At the Teradata Partners User Group conference, which I am attending in Las Vegas this week, the data warehouse giant hosted a press event to announce its newly forged strategic partnership with SAS.
The two companies are trying to capitalize on what they say is a "pent-up demand" for solutions that help remove the latency from the decision-making process, a key theme of the conference. To that end, the deal will enable companies to run SAS business intelligence applications within the Teradata environment, utilizing Teradata's core parallel processing capabilities to drive quicker business decisions.
While the announcement certainly qualifies as big news, its significance pales considerably in light of German software giant SAP's just-announced intention to buy BI pureplay Business Objects. A journalist from Computerworld acknowledged the gorilla in the room when she asked why Teradata opted to partner with SAS rather than buy it.
Teradata and SAS executives offered the expected answers, saying, for example, that a partnership allows their customers more freedom of choice than an acquisition.
"That would have been a good answer before Sunday's news (of the SAP/Business Objects deal)," responded the journalist.
A partnership also allows Teradata and SAS to play off each other's strengths with minimal impact to the balance sheet. Indeed, financial analysts and investors alike knocked SAP's offer of $6.8 billion for Business Objects, a 20 percent premium over Business Objects' closing stock price on Oct. 5. SAP's shares fell 5 percent in trading on Oct. 8, reports MarketWatch.
Though Teradata and SAS executives said that neither of their companies plans an acquisition in the near term, BusinessWeek predicts that SAP's move will trigger a flurry of buying activity among software companies. Indeed, it's possible that another company like Microsoft might make a bid for Business Objects, an investment banker tells BusinessWeek.