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Microstrategy Moves Up with e-Business

Written By: M. Reed
Published On: October 6 1999

Event Summary

"M2 PRESSWIRE-5 October 1999-ORLANDO, Florida -- NCR Corporation (NYSE: NCR) and MicroStrategy Incorporated (NASDAQ: MSTR) today announced that the two companies have signed a comprehensive, multi-year $52.5 million licensing and technology agreement. The agreement includes an investment by both companies in technology infrastructure, integration, and marketing - spanning e-business, business intelligence, and customer-centric data warehouse applications". Under the agreement NCR will re-market MicroStrategy's entire suite of Intelligent E-Business products and services. MicroStrategy will purchase NCR's TeraCube OLAP business for $14 Million in MicroStrategy stock, and purchase an NCR Teradata Warehouse worth $11 Million to power their Strategy.com network. Under the terms of the agreement, MicroStrategy will provide the development effort for TeraCube 2.0, and optimize it for the NCR Teradata database.

Market Impact

The agreement between MicroStrategy and NCR signals another overlap in the data warehousing arena. Once again, a business intelligence vendor and a data warehouse vendor have joined forces to provide an integrated solution for data warehousing. MicroStrategy will be able to leverage NCR's customer base and provide additional marketing muscle for the Teradata database. NCR will be able to provide improved OLAP solutions, since under the terms of the agreement, MicroStrategy will license new technology it develops back to NCR.

The release of MicroStrategy 6 indicates the vendor's strong commitment to e-business, customer relationship management, and web-based strategies, and is designed to "turn customer interactions into relationships". The product also includes publish/subscribe ("push") technology, and a new, XML based Web interface that acts as a subscription server. This focus should give MicroStrategy a distinctive marketing message that will set them apart from many of the other OLAP vendors.

The stock market has reacted favorably to MicroStrategy's market strategy, as their stock price has tripled over the last two months, and made very strong moves in the last two weeks.

Fig. 1

User Recommendations

Companies engaging in technology selection for OLAP tools should investigate MicroStrategy's offerings. Microstrategy has placed a strong emphasis on E-Business offerings, and MicroStrategy 6 is designed to be a "platform that empowers organizations to understand the interactions surrounding their customers, suppliers, and business". The MicroStrategy 6 offering should appeal to customers designing e-commerce applications, and be especially appropriate if the data warehouse underlying the application will grow to be extremely large, as the NCR Teradata database is designed for multi-terabyte implementations and supports massively parallel processing.

 
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