Unless you were sleeping under a rock, the deal shouldn’t have caught you by surprise. Do the math. IBM’s two major enterprise software rivals buy up two of the BI field’s three Tier 1 pure plays. And ever since acquiring Ascential 2 ½ years ago, IBM has been synthesizing an information server strategy whose prime missing link was business intelligence. Not that IBM and Cognos are strangers, 18 months ago both concluded a strategic alliance, and today, Cognos remains IBM’s prime BI partner – and vice versa.

Wall Street was obviously expecting a deal, given that Cognos’ shares surged almost 40% since last month’s SAP-Business Objects announcement.

IBM vehemently claims the deal was not defensive. Asked what took IBM so long, Software Group senior vice president Steve Mills spoke at length about the due diligence necessary for doing a $5 billion deal. While there’s little question that this was IBM’s deal to lose, IBM wasn’t the only possible suitor. HP, whose CEO came from Teradata, could have been a dark horse, but this horse would have been extremely dark. Yes, HP offers the Neoview data warehouse, but that’s no substitute for the more comprehensive strategy that converges information management, real-time business activity monitoring, and business process management strategy that it takes to elevate BI to the next level.

As we stated when Oracle announced its intentions with Hyperion, BI has little reason to remain a standalone market. As we argued with a colleague, the hockey stick phase of BI implementation happened a decade ago when client/server, later the web, introduced visual reporting and analysis tools, and when innovations in back end data transformation provided the added push for takeoff. At that point there was value-add in tools, as there was the need to reconcile different approaches to building analytic data stores. Today that technology has matured to point where enterprise platforms can federate data sources, reporting tools have grown commoditized, while adjacent disciplines ranging from enterprise performance management to BAM and BPM are beginning to erode the frontiers between historical, current, and future trend analysis.