When Microsoft announced its acquisition of Boise, Idaho-based ProClarity, many saw it as a slap in the face for Panorama, another close BI technology partner. Panorama was the original developer of the OLAP technology behind the Analysis Services component included in Microsoft’s SQL Server database platform. Microsoft acquired the technology back in 1996.

A few days after Microsoft announced its swoop, Toronto-based Panorama issued a press release curiously stating that it supported Microsoft’s move.

We’re happy to see Microsoft researching and investing in the BI space, said CEO Eynav Azarya in that release, adding that it would help Microsoft and its partners to drive better BI solutions.

ProClarity gives Microsoft a much needed front-end capability for Analysis Services, particularly in the area of data visualization. Up to now, Microsoft has relied on its Office suite – notably Excel – as a primary way to surface BI information to end-users. But it’s always lacked a robust BI interface for building ad hoc OLAP queries and dashboards.

Panorama plans to take full advantage of the Microsoft platform and integrate the new visualization capabilities into our NovaView [BI] platform, Azarya said.

But speaking to Computer Business Review, Oudi Antebi, Panorama’s vice president of marketing and strategy, offered a less diplomatic and more pragmatic assessment of the acquisition and its impact on the company.

For the price [Microsoft] paid it was for all intents a liquidation sale by ProClarity.

As a former, long-serving member of Microsoft’s BI team before joining Panorama last December, Antebi was privy to information that’s not been made public. As such he had anticipated a move to buy ProClarity well before it was officially announced on April 3.

Antebi claims that Panorama has been beating ProClarity in 70% of the larger deals it has contested thus far. He said that companies had chosen Panorama for its superior scalability.

ProClarity has always been focused on smaller deals, Antebi said. They have to because they’ve chosen to work natively with Analysis Service which doesn’t scale that well by itself.

We’ve created a mid-tier server that comes with connection pooling and caching that helps us to scale up in terms of performance

He claims that internal benchmarks with several customers [he declined to name them publicly] show that Panorama’s BI system scales 20-50 times better than ProClarity.

Antebi added that 18% of Panorama’s business comes from the mid-market and departmental applications, which he believes is an area that Microsoft will initially focus on due to ProClarity’s scalability issues.

Our suite spot is enterprise scalability, he said. Microsoft will go after mid-market and it’ll take them a couple of years to learn what’s needed to meet true enterprise requirements.

Antebi also said he thinks it will take Microsoft between 12 to 28 months to get a fully integrated product out to market.

Knowing how Microsoft has worked in the past it won’t sell ProClarity direct any more. They’ll likely re-open the code, review it line-by-line, add new security updates, re-brand and share a beta [release], he said.

Antebi said this gives Panorama a window to advance its own NovaView Sever – a middle-tier application server that extends and integrates with Microsoft’s BI applications and platform to deliver a more comprehensive set of BI functionality.

We’re way beyond visualization, he said. We’ve already built a mid-tier server that binds together analytics, reports, scorecards, dashboards, 3-D visualization and business modeling on a single, manageable server platform.

But we won’t be standing still. We’ll be adding things like natural language search through an joint initiative with a leading search engine company and intend to work more closely with SAP on process integration.

The SAP collaboration, which Antebi points out was initiated well before the ProClarity acquisition, could well signal a new path for Panorama to follow now that’s it’s been more or less snubbed by Microsoft.

In a year and half SAP will become 80% of our business and Microsoft will become minor, Lee Ho, Panorama’s vice president of strategic alliances, told Computer Business Review.

SAP is the next big opportunity for us since there’s no good front-end BI solution available for SAP BW [Business Information Warehouse] right now, Ho said. We’ll make BW shine and are committed to doing so now.

As part of an increased focus on the large enterprise market Ho said that Panorama had launched into a detailed analysis of the SAP BW market a year ago. The company has already rolled out an extension of NovaView to hook up to SAP BW, which is part of the SAP NetWeaver BI platform.

Our strategy is to become the primary BI solution for SAP BW, Ho said. We’re confident that we’re going to deliver the first integrated BI suite, that pulls together analytics, reporting, dashboarding, and visualization, directly on top of BW.

Antebi added that 40% of Panorama’s installed base today are SAP BW customers. But he sees significant opportunity for more SAP business.

There are roughly 32,000 SAP users today, Antebi said. Only 9,000 of these have BW actually turned on – which doesn’t mean they’re actually using it. In fact our research shows that around 10% are actually touching BW.

That leaves an substantial installed base of 8,000 customers that aren’t yet using BW which is a big opportunity for Panorama and SAP to address.

However, Antebi said that Panorama isn’t about to pull the plug on Microsoft anytime soon.

It’s business as usual with Microsoft as far as we’re concerned, he said. Until they release their new ProClarity product [which is at least half a year away by his estimation], Microsoft only has Panorama as a viable front-end option for driving greater BI adoption for SQL Server 2005.

You can only do that with software that’s on the market today – not one that’s in beta.

When Microsoft does eventually release its ProClarity product, Antebi expects Panorama to maintain fallback deals it’s getting as a result of customers looking for more scalability beyond that which ProClarity can offer today.

Microsoft isn’t likely to put a mid-tier between ProClarity and Analysis Services like we do anytime soon, Antebi said.

Ho also sees opportunities for Panorama to help Microsoft penetrate more deeply into SAP accounts as well. He points to the Mendocino initiative, a collaboration between SAP and Microsoft announced in April 2005 that aims to link SAP’s applications back-end with Microsoft’s front-end Office tools like Outlook and Office.

Things like Mendocino are great. But you need real example and proof-points of integration between Microsoft’s .NET and SAP’s NetWeaver platform, Antebi said.

Because we support both, Panorama can provide that integration point for companies that have made a significant investment in SAP and are now looking to drive BI into the hands of [Microsoft] Office users.

Ho said that Panorama will continue to work with both SAP and Microsoft on go-to-market initiatives in areas like supply chain management solutions.

So even with that acquisition of ProClarity, our relationship with Microsoft is stronger, Ho said.

Asked if he was surprised that Microsoft swooped for ProClarity rather than Panorama, Antebi raises a rather good point.

Why would you want to buy a company twice? When we originally sold Microsoft our OLAP technology they kept the server part and handed us back the front-end visualization component, Antebi said.

Microsoft probably thought, if we had the IP [intellectual property] once, why should be paying for it again.