California-based mobile resource management (MRM) solutions provider Xora announced today that it has merged with its top competitor, Minnesota-based Gearworks. The combined company will fall under the Xora name, but existing products and services will continue to run independently and retain their current names. Plans to look for synergies and simplify the offerings onto a single technology stack will take place as early as next year. Xora doubles its customer base with the merger, bringing the total to 16,000 worldwide. Moreover, the company finally has a relationship with mobile operator Verizon Wireless, which previously worked exclusively with Gearworks.
Though the two companies came into the merger with equal number of customers, Rani says Xora was the bigger of the two based on number of subscribers. Current investors of both companies have contributed to this transaction, adding $8.5 million to the new business. Together, the company claims to be at least twice the size of their nearest competitor, Rani says. Other players in this space include both California-based TeleNav and Trimbul. Xora also acquires Gearworks' Appmosphere mobile application delivery platform, which allows Xora to provide flexible, customized applications for its larger, enterprise customers.
Xora and Gearworks offer solutions in the B2B mobile business application space, but Ananth Rani, vice president of product and services at Xora, says other terms are floating around the industry, such as MRM and mobile workforce management. Essentially, the solution enables companies to keep track of three fundamental elements of the business:
- vehicles; and
- other assets.
For the most part, the technology has been most prevalent in what Rani calls the "guys in trucks verticals" (e.g., service technicians, food-and-beverage delivery personnel, etc.). The technology can track where these individuals are in order to optimize service delivery. Moreover, it unchains employees in the sense that they can activate their time cards via their mobile devices -- a concept also referred to as "punch to paycheck." "Anytime you get on the road and drive," Rani says. "You'd be passing our customers or prospects."
The technology is a phone-based application that connects only with devices with a GPS chip. The service is resold directly through the wireless carriers, a business model Stephen Drake, program vice president for mobility and telecom research at IDC, says is "really valuable." Mobile operators, for one, are looking to deliver more value to the end users, even beyond email and other data services, especially with revenue from voice capabilities declining. Moreover, Xora's offering is delivered in a hosted environment, which allows mobile operators to deliver the solution without worrying about the intricacies of the technology. Consumers sign up directly through their carrier and pay for the service on the same bill. "They're delivering solutions carriers can sell in a digestible way," Drake says, contrasting the service with the larger, back-end, CRM enablement-type applications that are more complicated for companies, especially the largely-neglected small and mid-size companies, to get up and running.
In its partnership with Gearworks, Verizon Wireless rebranded the offering as Field Force Manager. Xora plans to keep the white-labeled product name rather than moving it under the Xora brand, GPS TimeTrack. "Verizon was smart to keep it simple in a single offering," Rani says. "We don't want to disturb any of that stuff."
Getting Verizon on board, Drake says, is perhaps the "crown jewel" of the acquisition. The time and resources needed to sway the operator would have been extravagant, a process Drake says could easily take years. With the merger, Xora is able to immediately bring Verizon in, giving Xora access to the top business-oriented mobile operators in the U.S.
The combined company claims to have "the broadest wireless carrier distribution footprint in the industry," boasting partnerships with Tier II domestic operator U.S. Cellular and call solution provider Atlanta-based Cbeyond. The merger further helps to enhance Xora's existing international presence with Australia-based Telstra, and Dominican Republic-based Professional Call Solutions (ProCall). Going international, Drake says, will be a critical differentiator in this space.
"Consolidation was inevitable in this market," Drake says. Organic growth can only get you so far, he says. "In order for [Xora and Gearworks] to take it to the next stage, acquisition is often key to growing the size and scaling operations."
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