IAM ALERT: OpenText to Acquire Vignette – Are They Out of Their Bloomin Mind?

Information Architected Market Alert (IAM Alert):

Today OpenText announced plans to acquire Vignette. (See press release.)

On one hand this move makes sense. OpenText has clearly been on a growth through acquisition strategy, and this move is aligned with that. As I blogged about last January, Tom Jenkins, OpenText Chief Strategy Officer and Executive Chairman, stated that OpenText was positioned to be the first ECM company to achieve $1 billion in revenue. With the acquisition comes the revenue and installed base of Vignette.

But, unlike other acquisitions made by OpenText, (e.g., acquiring DAM technology via Artesia) with this acquisition there is little to no gain in functionality. The overall value proposition of OpenText remains the same. With Vignette, OpenText acquires redundant capabilities. OpenText was the first document management solution to embrace the internet and thus provide WCM. They strengthened this offering with the acquisition of RedDot. So what, technically does Vignette add to the OpenText toolset?

I cannot help but think OpenText would have been better off exerting the time, energy and cost behind this effort, with a campaign to go after Vignette customers (and those of similar waning solution providers) and make them a “deal they couldn’t refuse.” This is similar to what Interwoven did to PC DOCS customers years ago.

The ability to assist customers with such a migration plan is in keeping with the OpenText BLOOM strategy. Wouldn’t Opentext have been better off leveraging BLOOM in this way? Instead, now OpenText has yet another technology platform to support or build an integration strategy for. At least short-term, OpenText will have to keep Vignette’s product line intact.

Technically, what is the OpenText strategy? Vignette only makes the company’s technology strategy more complex and confusing. Open Text already has a mix of of .NET, C++, and Java technologies. With Vignette they add a J2EE-based system. And for what – redundant capabilities? Is this a poor leveraging of the BLOOM strategy? Is OpenText out of their Bloomin mind?

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