Business intelligence software is one of few areas of IT that has sold well during tough economic times. And as the U.S. begins to emerge from a crippling recession, IBM predicts companies will invest heavily in software that provides insights into sales and operational performance.

At IBM's Information On Demand conference in Las Vegas, which began Monday, "the overriding message is the importance of analytics in today's market," said Rob Ashe, GM of analytics and performance management at IBM. "We've seen unprecedented interest in the area of analytics," Ashe said in an interview last week. Ashe was CEO of Cognos before IBM acquired it for $4.9 billion in 2008.

On Monday, IBM announced a new category of applications, called Content Analytics, designed to help employees more easily analyze both structured and unstructured data, such as email and blogs, plus new applications for customized for sales, talent management, and procurement analytics.

The Content Analytics apps were born from the work of IBM's research and development group and of a team from FileNet, a document-management vendor IBM acquired for $1.2 billion in 2006, Ashe said. The apps are intended to let companies combine business intelligence gleaned from transactions running in internal systems, with unstructured data coming from the outside, such customer emails, customer comments on blogs, or market-trend reports prepared by outside organizations.

Three new IBM Cognos analytics applications are designed to let specific employee types assess departmental performance. Executives and sales managers can use Customer Performance Sales Analytics; human resources pros can use Workforce Performance Talent Analytics; and procurement pros, Supply Chain Performance Procurement Analytics.

Expect to see greater integration between the products from newly acquired SPSS and IBM Cognos, said Ashe. "There's a lot of focus right now on advanced analytics, predictive analytics, and real-time decision making using predictive capabilities," Ashe said.

IBM has made several BI-related acquisitions in recent years, the most recent being the purchase of predictive-analytics vendor SPSS for $1.2 billion, which closed earlier this month. In IBM's third-quarter conference call with analysts on Oct. 15, CFO Mark Loughridge said IBM planned to funnel even more of its profits into new investments in analytics.

In a report on BI platforms earlier this year, Gartner said that IBM has hired more than 800 employees since early 2008, representing a 20% growth in the Cognos portion of its BI workforce since the acquisition closed. And in a Gartner user survey, IBM Cognos 8 had the highest overall score among popular BI platforms, including SAP's Business Objects.

Gartner, however, also noted "stresses and strains" on the Cognos organization by the "internal demands of the wider IBM organization," which could be distractions to market success. IBM/Cognos ranked No. 4 in BI market revenues in 2008.

Worldwide sales of BI software grew 22% in 2008 to $8.8 billion, according to Gartner, with SAP/Business Objects, SAS Institute, Oracle, IBM/Cognos, Microsoft, and MicroStrategy owning 75% of the market. By comparison, the market for worldwide BI software grew only 13% between 2007 and 2008.

At an Oct. 20 conference, Gartner ranked advanced analytics as No. 2 on its Top 10 list of the most strategic technology areas for 2010.

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