SAS seeks to extract meaning – and business benefits – from the Web 2.0 world

One might argue that it’s next to impossible to find any real meaning out in the blogosphere – but SAS Institute Inc. would emphatically disagree.

In factCary, N.C.-based SAS hopes to offer its customers that very capability through the acquisition of a text mining analytics company.

Announcing the acquisition of Cambridge, Mass.-based Teragram Corp. at the SAS Global Forum in San Antonio, Texas, company executives presented this as a milestone in ongoing initiatives to draw business benefits from Web 2.0 technologies.

The idea is to help companies make sense out of the language-based information found in blogs, e-mails and social networking sites, says Jim Davis, chief marketing officer for SAS.

SAS plans to integrate Teragram’s technology into its Text Miner product.

“Everything about the business intelligence space has been based on structured data, and [most] data  out there is unstructured,” Davis says. “Our product line is going to evolve heavily to support unstructured data.”

With Teragram, SAS takes 40 more employees under its wing and several high-profile media clients. Media behemoths such as The New York Times, CNN, the Washington Post, and Forbes represent a sampling of companies that makes use of the software to analyze their Web sites.

News media outlets have been making use of Teragram’s software over the past decade to examine the topics of their articles, as well as the relationships between people and events. Now all industries can benefit from the software, says Yves Schabes, president of Teragram.

“Enterprise is now adopting these technologies because the amount of text and data is growing so fast that they need to organize it in a methodical fashion.”   

Teragram’s speciality is quickly sifting through vast amounts of text – like the ultimate speed reader – and extracting information that a business would find useful, Schabes says,.

“You want to capture the important things in the document and their relationship,” he says. “Then you can turn the text into something structured that you can take action on.”

The amount of digital information that enterprises must sort through is set to grow exponentially over the next few years, according to analyst firm IDC.

It projects the amount of data captured and replicated to shoot up 500 percent – to 1,800 exabytes in 2011 from 281 exabytes last year.

Exponential data growth is a challenge the Silver Spring, Md.-based Association for Information and Image Management (AIIM) has been confronting for years, says Thornton May, dean at the IT Leadership Academy and former AIIM chairman.

“We weren’t doing a good job with the structured data and the unstructured data was just a gong-show,” the bow-tie wearing IT futurist says.

Business people must change their concepts of what is possible to be known, and the merger is a step in showing them what is possible, May adds. “It’s a brilliant acquisition.”

Teragram appealed to SAS because of their multi-lingual capabilities, Davis says. The company offers its product in more than 30 languages, supported by annotated dictionaries containing hundreds of millions of words.

“If there’s a strong demand for a product in a particular country in the native language, our product will be set up to handle that language,” Davis adds.

More than half of SAS’s revenue of $2.15 billion, in 2007, came from outside of the Americas.

Teragram offers compatiblility with all of the major global languages, Schabes says. Its multi-lingual ability will now be combined into SAS products before the end of the year.

Warranty analysis is one way the the new features could be potentially be used, SAS’s Davis suggests.

“If you can look at the trends and at warranty claims, you can potentially save a lot of money,” he says.

Other opportunities exist in mining information on social networks, he said.Sifting through blogs and interactions on social sites to determine patterns of behaviour as well – could translate into business opportunities, Davis suggests.  

Teragram will be operated as a SAS company, but left to run independently, Davis says – a strategy consistent with past acquisitions by one of the world’s largest private companies.

Davis contrasts this with the post-acquisition practices of many large enterprises.

A lot of them will fold in the technologies of the acquired company and disperse the employees, he says. “That’s not our intention. We think to keep the innovation going, its important to keep these people intact.”

The terms of the deal were not made publicly available.

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