What prompted IBM to pay about 5 times Cognos' annual revenue and nearly 40 times its most recent net earnings? Well, you can chalk some of it up to Sarbanes Oxley. IBM has been aggressively pursuing the compliance opportunity--along with Oracle and SAP--and seems to be close to achieving "leader" status in the Gartner Magic Quadrant for financial compliance software companies. Of course, Cognos was a leader in Business Intelligence. The challenge for IBM is to offer the software in an integrated way. One could argue that compliance is the conversion point for a lot of apps, content management, business intelligence, core GRC, and ERM. IBM is clearly on to something.  

For more about the purchase:
- read this New York Times article [1]