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ECM: Is Bigger Better
Another mammoth ECM acquisition has recently been announced: OpenText is to buy Vignette. This follows the trend in the last few years of acquisitions like IBM and FileNet, EMC and Documentum, Oracle and Stellent, Autonomy and Interwoven.
The latest OpenText deal may make the least sense of these though. The bid came in at $310 million. OpenText seems to be feeling the need to bulk up and hopes to do so with this merger. But the purchase may be more of a burden than a blessing for OpenText. While Vignette will bring more customers, but there is significant overlap of Vignette software with OpenText’s own software and RedDot software, another Web Content Management company acquired by OpenText earlier.
OpenText’s software is primarily built on .Net and C++ while Vignette runs on J2EE — two very different technologies. That could pose for some complicated engineering decisions on how to proceed in future product development.
Such purchases seem short-sighted and muddle the product direction for these companies. After mergers, the software from these companies have typically stagnated. This consolidation activity may actually be playing into the hands of a vendor like Alfresco that has a clear product vision and direction and is not tied down by legacy software and integrations.
