Microsoft announced today that it is discontinuing the Microsoft Office PerformancePoint Server product. The business performance monitoring and analytics capabilities of PerformancePoint will be bundled into the SharePoint Server enterprise license (CAL) going forward, and no longer sold separately. The planning and budgeting capability of PerformancePoint will see a midyear enhancement that is already in the works, and then put into support mode. Existing PerformancePoint customers will receive support on these products for 10 years. Another element of the announcement is the return of FRx reporting and forecasting capabilities to the Microsoft Dynamics business applications group.


After investing heavily in the development and launch of PerformancePoint over the past 3 years, it is a major shift in strategy for Microsoft to essentially kill off the product initiative. Its rationale is that the goal is to make business performance monitoring and analytics pervasive across the enterprise, and SharePoint is the best vehicle to carry this functionality. Microsoft expects that bundling these capabilities at no additional cost within the SharePoint enterprise license will accelerate sales of SharePoint, including upgrades from the standard license. Planning, meanwhile, is seen as a Finance desk application that is not part of the SharePoint strategy.


Microsoft is evidently discountinuing the planning application from PerformancePoint. The logical home for it is within the Microsoft Dynamics team, but the product overlaps with the existing FRx Forecaster. FRx Forecaster is a midmarket-oriented budgeting application that was to be superseded by PerformancePoint, but now is being kept alive. Forecaster, which is much less successful as the FRx financial reporting application, still relies on a proprietary UI that is Excel-like but not natively Excel-based. The Dynamics line of business could ultimately offer the more sophisticated planning component from PerformancePoint in lieu of Forecaster, but this scenario appears unlikely.


Overall, it is disappointing to see Microsoft pull the plug on the PerformancePoint product initiative, which showed reasonable promise as a cost-effective alternative to IBM Cognos, Oracle and SAP business performance solution (BPS) offerings. Yet the competition ultimately may have been too much to handle. Microsoft was slow to close PerformancePoint functionality and product integration gaps, due to dependencies on the release cycles of the flagship Microsoft products, including Office, SharePoint and SQL Server.