The first salvo was Informatica's announcement that it has entered the master data management (MDM) market with the $130 million cash purchase of Siperian. Informatica has been steadily pushing beyond the confines of extract, transform and load software for data warehousing. The move into MDM was long expected because it's a natural extension of the company's data quality offerings.
"The combination of Siperian and Informatica expands our addressable market... and we will cross-sell Informatica data integration and data quality products into MDM opportunities," said Sohaib Abbasi, chairman and CEO of Informatica, during a conference call with financial analysts.
The acquisition sets up yet another market in which Informatica competes with the industry giants. But the move may rankle Oracle, which uses Informatica identity resolution technologies in its own MDM offerings. Abbasi dismissed coopetition as fact of life in the IT industry, and he told financial analysts he expects OEM relationships with Oracle, HP, Intel and Microsoft to continue.
MDM software helps organizations ensure data consistency and reliability across dimensions such as customers, products, locations and employees. The market for MDM software will reach $1 billion in 2010 and is growing 20% per year, according to Forrester Research. Informatica previously partnered with independent MDM vendors Siperian and Initiate Systems. Siperian is particularly strong in the life sciences market, where customers include Pfizer, Johnson & Johnson and St. Jude Medical.
The second salvo of news from Informatica yesterday was the release of impressively strong financial results, including the company's fifth year in a row of record growth, a 25% increase in software license revenue in the fourth quarter, and a 10% increase in total revenues for the full year that pushed the company over the $500 million mark for the first time. The results not only bucked last year's general downward trend in enterprise software sales, they hint that an independent may actually be gaining market share against larger rivals.
Returning repeatedly to the theme of running a focused company, Abbasi said the company's comparatively late direct entry into MDM was part of its disciplined approach.
"We have outlined a roadmap that we will provide more data-centric technologies and more integration-centric technologies over time, and we have executed on that strategy," Abbasi said.
During 2009, Informatica branched into application data archiving with the acquisition of Applimation, it entered the complex event processing market with the purchase of Agent Logic and it extended its data quality offerings with the purchase of Address Doctor, an online service for address validation and correction.