As Tom Taulli wrote earlier, Oracle Corp. (NASDAQ:ORCL) announced its intention to buy Hyperion Solutions Corp. (NASDAQ:HYSL) for $3.3 billion this morning. This will of course trigger speculation that the other two key players in the business intelligence space will go the same route. The players are French-based Business Objects (NASDAQ:BOBJ) and Canada-based Cognos Inc. (NASDAQ:COGN). The bottom line is that all three companies have been in play and facing buy-out rumors for the last three years. The only problem was they could not capture an enhanced valuation until they demonstrated real growth -- top and bottom line.

But what does this signal for Oracle? Oracle is the undisputed worldwide leader in database products. All competitors in the database field are dwarfed by Oracle. The operating margins for Oracle in pure database sales is north of 40%.

However, two problems have emerged for the company these past 4-5 years: 1) Its internally developed applications software has been a disaster, forcing Oracle to purchase Seibel Systems and PeopleSoft. 2) Database margins are being scrutinized by the customer base.