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10/29/2002
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Vignette Snatches Up Epicentric

The combined companies will attempt to build momentum as a platform for building real-time Web apps.

Vignette Corp. told customers at its annual user conference last week that it was looking to make it easier for companies to roll out real-time, content-driven Web apps, and it didn't take long to act on that promise. The cash-rich content-management vendor said Tuesday it's buying portal vendor Epicentric Inc. for a bargain-basement price of $32 million in cash and restricted stock. The deal faces customary regulatory and shareholder approval, but it's expected to close in December.

The acquisition comes a week after Vignette updated its content-management platform and revealed a product strategy to bring document-management, E-learning, E-marketing, and collaboration apps to market during the next 12 months. Vignette also has dabbled in portals and had planned to develop a portal app in the coming year, as well, but "it's clear they wanted a pure-play portal developer with a track record," says Connie Moore, VP at Giga Information Group.

Vignette's move is the latest indication of a convergence of content management, portals, and collaboration tools. But Moore says the acquisition differs greatly from Documentum Inc.'s purchase of eRoom earlier this month.

Whereas Documentum and competitors such as iManage Inc. are pursuing a collaboration-intensive approach to enterprise content management, Vignette is looking to build on its Web-content-management pedigree to become a platform for developing content-driven Web apps. Moore questions whether the strategy will work, saying buyers emphasizing portals as the medium for delivering content apps will choose best-of-breed options. She expects Vignette to find many of its customers already committed to different portal vendors.

Epicentric CEO Michael Crosno told analysts on a conference call Tuesday something different, though. Crosno said Epicentric customers are under pressure to reduce the number of vendor relationships, and that pure-play, best-of-breed vendors will probably have a tough time competing. "A point-based solution in this environment is going to be challenged," he said. Meanwhile, Vignette CEO Tom Hogan promised that the buyout of Epicentric will add up to more than the sum of the parts. "This is more than combining two assets," Hogan said. "This is really a game-changing acquisition."

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