Net Results:IBM's announcement this week that it had purchased the last remaining large stand-alone business intelligence applications company Cognos is further evidence of how much industry consolidation and integration is happening at the moment, writes Karlin Lillington.

In this sector, IBM's move follows SAP's recent bid for Cognos's rival Business Objects last month, and Oracle's acquisition of Hyperion Solutions earlier in the year.

IBM said the acquisition wasn't in response to its rivals' moves, but nothing spurs the acquisitive appetite quite like the realisation that the choices are becoming few due to the strategic moves of rivals - even if it means going into the applications business, which IBM has steadfastly said it had no intention of doing.

That's surely the case here. It may well be that IBM had been seeking an acquisition for some time. The reality is that it needed an acquisition in the area, and duly made a $5 billion (€3.4 billion) offer on the largest of the remaining business intelligence companies.

The tech giants seem to have an insatiable appetite of late for swallowing smaller companies, even when "smaller" might only be in the most relative terms. Take Oracle's pursuit and eventual capture of former major rivals such as PeopleSoft and Siebel Systems - both companies were significant within their sectors, and large corporations by any measure.

Nonetheless, Oracle made the decision that getting even bigger was better despite concerns voiced by analysts that absorbing those purchases could prove difficult and ultimately damaging.

Oracle's gamble seems to have paid off, with solid financial results and, it seems, a relatively smooth integration of even giants such as PeopleSoft.

Symantec is another company that has been on an acquisitions spree, transforming itself from a computer security products company to a gigantic security products and services company. It has had a bumpier ride, taking a longer time than it expected to fold in big purchases like Veritas, but many analysts have given Symantec's moves a thumbs-up.

Google is another well-known buyer and has had its company hoover on full power for the past few years, sucking up numerous small internet companies and, of course, one huge but profitless one - YouTube.

In general, in the last five years, the amount of acquisition activity by the very big, deep-pocketed technology companies has been astonishing. Consolidation and integration: that's a key message coming from technology companies these days, whether large or small.

The companies will argue that the drive for this is twofold. On the one hand, there's a huge push within companies to make their information technology work harder at less cost. That means they want applications to work together more seamlessly on less hardware, not to have separate stacks of applications running on separate systems needing a range of minders to keep it all ticking over. In other words, integration.

Making things work together tends to be easier if you own all those disparate companies yourself. So the tech companies can afford to go shopping.

Industries also tend to go through rounds of consolidation anyway when they reach certain levels of maturity. Analysts and certain chief executives will argue that the software and hardware industries have been ripe for consolidation, and that what is going on is a natural progression.

HP chief executive Mark Hurd, speaking at Oracle's massive OpenWorld user conference this week in San Francisco, was very blunt about how he thinks it's all going. "In the technology industry, there are only a handful of companies with $100 billion to go play with. At the same time, we're all getting the push to have more integration and less suppliers."

There are only three options for that $100 billion, he says: dividends for shareholders, buying back stock and acquisitions.

"Potential M&A [merger and acquisition] opportunities will rise to the top of those choices. At the speed that it does, you will see consolidation."

Read that to mean you ain't seen nothing yet.

Blog:www.techno-culture.com