US content management firm Vignette has bought portal vendor Epicentric for just $32 million.
Vignette has bought the assets of enterprise portal vendor Epicentric, in a cash and stock deal valued at $32 million – a reasonable price, especially compared to Documentum’s recent $100 million acquisition of the collaboration specialist eRoom.
The deal makes sense from a technology perspective, as Vignette and Epicentric have previously collaborated to integrate the V6 platform with Epicentric’s portal offering. But its strategic implications are more important – CEO Tom Hogan says the acquisition is game changing, moving Vignette into the enterprise web application business.
Portals and content management systems are inherently dependent on each other to deliver true value to the enterprise, so Vignette is moving in the right direction to distance itself from its traditional competitors. At the same time, as users with limited budgets look for more ‘bang per buck’, Vignette’s move into the realm of one-stop-shops should help increase spend per customer.
However, times will still be tough. The portal market is becoming increasingly commoditized: vendors such as IBM, BEA, SAP and PeopleSoft offer portals as part of their overall solution stack – and in some cases give them away to ensure that they win the customer.
Vignette will have to make its new product offering clear and understandable to the user. While the concept of portals is easy to understand, enterprise web applications will be somewhat more difficult to digest.
Portal firm Plumtree has been swift to offer a migration program that tempts Epicentric customers concerned about the acquisition with a 90-day pilot of Plumtree’s Enterprise Web solution. However, this plan looks unlikely to attract many customers: troubled Plumtree is also an acquisition target.
There will be further consolidation in the pure-play portal market; only time will tell which players will buy which. But users want to avoid the Russian doll scenario of multiple vendor portals within the organization; consolidation of vendors and products is the only viable alternative.
Related research: Datamonitor, Enterprise Integration, Portals and Web Services 2002 (DMTC0865 – due November 2002)
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