IBM can't be satisfied with the No. 3 position in the business intelligence software market, so it's hard to imagine a better decision than its acquisition Tuesday of SPSS Inc. for $1.2 billion.

SPSS's forte, predictive analytics, is in high demand among businesses, and the acquisition surely has SPSS's partners nervous, whether they're willing to admit it or not.

But IBM's next step is execution, which is tougher and more important than the decision. More businesses are purchasing BI from their software application vendors, and IBM is not an application company in the vein of SAP or Oracle. IBM and its Cognos division had 10% of the total BI market in 2008 with revenues of $800 million, up 5% since the previous year.

Compared with competitors, that's sub-par performance. SAP, SAS, and Oracle -- ranked No. 1, No. 2, and No. 4 -- all had double-digit revenue gains, with the total BI market growing 10.6% to reach $7.8 billion, according to an IDC report released in June.

IBM has one of the broadest BI portfolios of any vendor, which it greatly enhanced with its $4.9 billion acquisition of Cognos in 2007, making its single-digit revenue growth all that more surprising.

IDC speculates that "unlike SAP and Oracle, which have substantial applications software businesses, IBM's focus on infrastructure and middleware software and professional services means that selling to large number of business end users is not a core competency of IBM's non-Cognos sales force."

Yet this deal is a little different than Cognos, and brings some different benefits to IBM. The advanced (or predictive) analytics segment of the BI market grew 12% last year to $1.52 billion, according to IDC, and is expected to stay strong despite an overall pullback in IT spending.

"The 'new black' is predictive analytics, as companies look to optimize costs and revenue and find the best customers," says Rita Sallam, an analyst with Gartner.