Data Quality Consolidation Continues
Pitney Bowes' move to acquire the remaining outstanding shares of Firstlogic in September is part of the latest wave of data quality consolidation. The company, which already owned 10 percent of Firstlogic, acquired Group 1 Software in July 2004.
"The investment rationale for Group 1 was to acquire a broad spectrum of technology and link it to Pitney Bowes' existing assets to fulfill our multichannel Customer Communications Management (CCM) vision for our customers," says Bernie Gracy, vice president of business integration at Pitney Bowes Document Messaging Technologies. Part of the thinking behind the Firstlogic deal, however, was to expand into other arenas, including supply chain management/lean manufacturing, data warehousing, and BI, while extending the data quality component of its CCM strategy.
"Firstlogic was not a weak player in any sense of the word," says Aaron Zornes, chief research officer at The CDI Institute, even though it lacked strong financial backers. Vendors like Informatica that have OEM relationships with Firstlogic and Harte-Hanks's Trillium Software stand to lose from the deal. "While the OEM relationship will probably not go away, it is important to note that Informatica remains the sole major ETL vendor that's not part of a bigger software panoply," Zornes says. "The standalone ETL market is getting lonelier by the minute."
Although the company contends it will maintain its focus on delivering functionality to the market, rivals like Trillium view the acquisition as eliminating competition. "After Pitney Bowes purchased Group 1 in 2004, we hardly saw them in the field selling scalable data quality solutions," says Sarah Kohler, product manager at Trillium. "We would not be surprised if the same happens to Firstlogic."