OpenText Acquires Actuate

David Stabel
Jan 20, 2015

On December 5, 2014, OpenText announced its intention to acquire Actuate for around US$330M. One month later, on January 16, 2015, OpenText announced the successful completion of it. This acquisition follows a series of takeovers by OpenText throughout recent years with the objective to become the leader in the Enterprise Information Management (EIM) market. A market that OpenText estimates to be almost US$21B in size.

 

Some of OpenText’s earlier acquisitions were targeted to strengthen its Customer Experience Management (CEM) suite: Artesia (August 2004), a provider of Digital Asset Management (DAM) solutions; RedDot (October 2006), a provider of web site management solutions; Vignette (July 2009), a provider of Web Content Management (WCM) solutions; and StreamServe (October 2010), a provider of Customer Communications Management (CCM) solutions. InfoTrends believes both OpenText and Actuate will benefit from this acquisition. This blog briefly explains why.

Firstly, Actuate provides software for personalized analytics and reporting through its BIRT technology platform – an open source platform to create data visualizations and reports that can be embedded into client –and web applications. Actuate’s visual analytics tool called BIRT Analytics (based on the acquisition of Quiterian in 2012) will be a valuable asset for OpenText. Visualized analytics and reporting will be an enrichment for OpenText’s portfolio and its customers. Or as Mark J. Barrenechea, President & CEO of OpenText, puts it: “…OpenText customers will now benefit from added analytic capabilities to their existing deployments…

Secondly, Actuate has a very sophisticated mobile app technology, called BIRT Mobile. This app is able to render any content available in BIRT iHub, which is Actuate’s commercial version of the BIRT platform. This mobile technology will be of great use within OpenText’s CCM platform (former StreamServe) in that it will enrich its mobile communication channel capabilities.

Thirdly, as a result of the acquisition, OpenText now has access to an additional 5,000 enterprise customers in financial services, technology and government. They can leverage on this by cross –and upselling their Enterprise Content Management (ECM), Business Process Management (BPM), and CEM solutions. This goes both ways as also Actuate can cross –and upsell their products to OpenText’s customers. Further to this, the acquisition provides Actuate (estimated US$100+M global revenues in FY2014) with financial support of its almost 16 times bigger new parent company OpenText (US$1.6B global revenues in FY2014). Actuate’s business performance has been under pressure recently as revenues declined by 26% and operating profits declined with more than 90% during the first nine months of FY2014 compared to the same period in FY2013. Under these conditions, there has been a necessity to look for more scale and additional sales opportunities. Through Opentext, this necessity is now within reach.

Finally, about 3.5 million developers and OEMs are using BIRT, which Actuate founded and supports. OpenText has now the opportunity to leverage on the knowledge and expertise of this open source community. However, OEMs may have concerns about the impact of the acquisition on Actuate’s support of BIRT as BIRT typically is an embedded part of their product(s). These concerns can be traced back to a similar case where Oracle, who acquired Sun Microsystems in 2010 including its world famous open source Java technology, was finding ways to monetize on this technology.

InfoTrends tracks the CCM market very closely with its recently launched Customer Communications Management & Engagement Strategies (CCMES) consultancy and advisory service and its online CCM Ultimate Guide.

 

 

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