SAS, Microsoft a possible pairing after Broadcom talks end
SAS Institute could have its sights established on Microsoft.
Just a day right after acquisition talks between SAS and Broadcom ended up manufactured general public, TechTarget confirmed that people negotiations have finished without the need of the providers achieving an agreement for Broadcom to obtain SAS.
As an alternative, SAS, a longtime impartial analytics vendor, is hoping tech huge Microsoft will become its mother or father enterprise, according to R “Ray” Wang, founder, chairman and principal analyst at Constellation Study.
“They are making an attempt to get Microsoft to be section of the offer and bid,” he mentioned.
The Wall Street Journal to start with reported on July twelve that SAS and Broadcom ended up discussing an acquisition that would worth SAS at $fifteen billion to $20 billion, and then reported on July thirteen that people talks experienced damaged down.
Had the offer long gone as a result of, at $fifteen billion it would have approached the dimensions of Salesforce’s $fifteen.7 billion acquisition of Tableau in 2019, and at $20 billion would have far exceeded it and been the largest analytics sector acquisition at any time.
People talks with Broadcom, even so, ended up probable a ploy to allow Microsoft know that SAS is wanting for a customer, according to Wang.
“The offer was leaked to see if Microsoft would consider the bait,” he mentioned.
While Wang mentioned SAS is hoping Microsoft emerges as a customer, SAS co-founder and CEO James Goodnight — broadly identified as Dr. Goodnight mainly because of his PhD in statistics from North Carolina Condition University — instructed personnel on July thirteen that the enterprise is not for sale, according to SAS spokesperson Shannon Heath.
“I can validate that Dr. Goodnight sent a information to all personnel which mentioned, ‘We are not up for sale,’ ” she mentioned.
Pertaining to Wang’s statement that SAS is hoping to get acquired by Microsoft, Heath added that SAS experienced no remark.
“With regard to the more inquiry about Microsoft, SAS does not remark on rumors or speculation,” she mentioned.
Microsoft did not promptly reply to a ask for for remark.
A excellent romance
SAS, started in 1976 when it was section of North Carolina Condition, is based in Cary, N.C., has a deep present romance with Microsoft.
In June 2020, SAS and Microsoft unveiled a partnership agreement below which Microsoft grew to become the most well-liked cloud supplier for SAS’ analytics merchandise, which contain SAS nine.4 for on-premises people and Viya 4 for its cloud customers. In addition, SAS’ analytics equipment ended up migrated on to Microsoft Azure, the tech giant’s cloud computing platform, and SAS and Microsoft created a joint go-to-market place technique.
Irrespective of the partnership agreement, even so, SAS remained cloud agnostic and in Might 2021 added native guidance for each AWS and Google Cloud Platform.
Specified the near romance between SAS and Microsoft, which features sizeable client overlap, there would be positives to a opportunity offer between the two, according to Boris Evelson, principal analyst at Forrester Study.
But mainly because the Microsoft and SAS have identical technological choices, there would be negatives as perfectly, he added.
“Ever considering that I’ve been functioning intently with SAS, likely again to 2000-2001, they have always experienced suitors,” Evelson mentioned. “SAS is a key, perfectly-identified world wide manufacturer, and has enjoyed virtually uninterrupted profitability for various decades. Each and every massive application enterprise would reward from owning SAS.”
Prospective added benefits of a offer between SAS and Microsoft are different, he mentioned. They include the vendors’ already potent functioning romance, the level of popularity of Azure with SAS customers, and opportunity synergies between Microsoft’s Energy Applications and Energy Automate — equipment that allow organization people to establish programs without the need of an knowledge in coding and facts science — and SAS’ analytics capabilities.
Meanwhile, over and above sizeable technological overlap, a opportunity downside could be Microsoft’s acquisition pattern of getting providers off the market place and possibly integrating them into present Microsoft merchandise or reintroducing them as a new Microsoft item.
“That method will clearly not operate with these kinds of a behemoth as SAS,” Evelson mentioned. “This implies Microsoft will most probable depart SAS running as an impartial organization unit for at minimum a couple of years, and over time will rationalize the portfolio, embed some merchandise in Microsoft’s stack and retire some.”
Wang equally famous that the present partnership between SAS and Microsoft is sizeable, but added that the quality of that the partnership could allow the providers to conquer opportunity hurdles.
“SAS has been making deep interactions with Microsoft, from Azure to analytics to compute,” he mentioned. “There appears to be a pretty peaceful and successful romance.”
Kjell Carlsson, principal analyst at Forrester, in the meantime, mentioned it makes feeling for SAS to search for a customer, but that Microsoft could not be the 1 that really winds up producing the acquire.
An acquisition would allow Goodnight, who is seventy eight years previous, to retire. Oliver Schabenberger, who expended 19 years at SAS and served as each main running officer and main know-how officer, experienced been seen as a attainable successor but left to come to be main innovation officer at SingleStore in early 2021.
“To condition the evident, SAS has a management succession dilemma,” Carlsson mentioned. “Now that Oliver has left, I think everybody is scratching their head as to who that successor could be. Other providers have turned to promoting the organization in identical scenario.”
He famous, as an illustration, EMC promoting alone to Dell.
The primary difficulty, even so, is what Microsoft could get out of getting SAS, he mentioned.
SAS would provide capabilities that goal facts researchers — a persona Microsoft hasn’t ordinarily focused — but a vendor that specializes in augmented intelligence and equipment mastering could make a improved in shape for Microsoft, according to Carlsson.
“SAS is, earlier mentioned all else, a facts scientist-oriented enterprise,” he mentioned. “You could make the case that Microsoft would reward from filling this hole, but in follow Microsoft [could] struggle to effectively leverage a opportunity SAS acquisition versus other gamers in the ML/AI platform … who they could obtain far more cheaply.”
An acquisition development
Really should SAS get acquired by Microsoft, Broadcom, or any individual else, it would depict the continuation of consolidation amid analytics distributors.
In April 2020, Logi Analytics was acquired by ERP vendor InsightSoftware, and in Oct 2020, IBI — formerly Information Builders — was purchased by Tibco Computer software. In 2019, just 4 times in advance of Salesforce acquired on June ten, 2019, Google acquired Looker for $two.six billion.
In addition, there have been a collection of lesser discounts with analytics distributors getting AI and ML distributors to include people capabilities to their analytics equipment. ThoughtSpot, for illustration, has already manufactured two acquisitions in 2021, and Qlik acquired Blendr.io on the very same day Tibco purchased IBI in 2020.