BUSINESS intelligence (BI) vendor Business Objects has extended its global strategic alliance with IBM to the Asia-Pacific region. The two companies will jointly co-develop, sell and implement joint information-on-demand solutions in Asia Pacific, to customers in more than 15 countries in the region.

Business Objects vice-president Michelle Hodges told BizIT that her company is already using IBM hardware and software for all new joint sales opportunities. The two companies intend to provide localised support for new and existing small and medium-sized business and enterprise (SME) customers throughout the Asia-Pacific, including Japan (APJ).

Ms Hodges, who is Business Objects' APJ vice-president for channels and alliances, added that the two companies hope to increase their sales, marketing and technical support in an effort to expand their joint customer base.

'IBM and Business Objects have more than 1,000 joint customers currently in Asia-Pacific. Business opportunities in the region that the two companies are jointly working on in this quarter have increased five times over the previous quarter alone,' she added.

BI is a fast-growing area of software that comprises applications that help companies gather, store, provide access to, and analyse information in their databases. Recent market studies name BI as the top priority worldwide for chief information officers across different industries.

Last November, Business Objects and IBM announced the formation of a strategic alliance, the highest level partner relationship for both companies, with the aim of providing support for thousands of joint Business Objects and IBM customers. The companies are now in the process of developing this alliance in the APJ region.

Jay Ennesser, vice-president, IBM Global Solutions, said the two companies aim to capture a growing market share in more than 15 countries throughout Asia-Pacific, including Australia, New Zealand, China, India, Singapore, Malaysia, Taiwan, Korea and Japan.

He added that IBM's Pacific Development Centre (PDC) in Canada already has over 300 software engineers with expertise in BI and Business Objects software. Regionally, IBM development centres in Bangalore and Shanghai will be involved in developing new products for the region under the current alliance.

Both Ms Hodges and Mr Ennesser said their respective companies are excited about the business prospects in APJ and the focus would be mainly the SME sector in the region.

Quoting data from IT research agency IDC, Business Objects' APJ director for global alliances, Shobhit Dubey, said in the Asia-Pacific excluding Japan (APEJ), there were 24 million SMEs in 2006 and their combined IT spending was US$47.3 billion. If Japan were to be included, the figure would be much higher.

Mr Dubey added that the US$47.3 billion spent represented a base market where the alliance could look to provide BI solutions so that companies could better utilise applications like customer relationship management (CRM) and enterprise resource planning (ERP).

Ms Hodges said the two companies will focus on four areas in Asia-Pacific. One of them is a health care solution, which will be targeted at the life science and health care industry.

Another target area will be a credit card solution which will help in customer and profile and usage. Interestingly, the alliance will target tier two banks with this solution. Another solution that will be offered to tier two banks will be a retail banking solution which will help to profile customers and their banking services usage patterns.

For the government sector, the alliance will offer an education data warehouse solution.

Ms Hodges said in the first quarter which ended March 31 this year, Business Objects' revenue from APJ was up 27 per cent year-over-year to US$24 million. The company's global revenue in the first quarter was US$334 million up 20 per cent year-on-year. APJ was the fastest growing region for the company. In the full year ended Dec 31 last year, Business Objects posted US$1.254 billion in revenues with APJ contributing US$87 million. Globally, the company has 30,000 SME customers.

IBM's Mr Ennesser said his company was very hopeful for the success of the strategic alliance between the two companies. 'Normally, we elevate a relationship with software applications vendors to the level of a strategic alliance if we are confident of hitting US$150 million global revenues within three years,' he said.

This article first appeared in BT on May 31, 2007