Open Text Makes Portal Play

Collaboration vendor acquires Corechange so it can offer improved end-to-end capabilities for customers looking to minimize the number of vendors they use.
Collaboration vendor Open Text Corp. expanded its capabilities in the portal arena Wednesday when it acquired privately held Corechange Inc., which makes software for linking multiple applications to a portal. The acquisition will let Open Text offer portal-integration technology with its suite of collaboration and knowledge-sharing tools, which company officials say will help it secure additional customers looking for help with portal deployments.

The real shocker was the purchase price of $4.2 million--well below what most observers estimated to be Corechange's market value. "That's a third of what I'd expected they'd get," Delphi Group analyst Hadley Reynolds says. "Get out your barf bag if you're a software vendor." Reynolds says Open Text is getting great value for the price, expanding on its strength in providing collaboration infrastructure by being able to offer customers the tools to expose several enterprise applications through a portal and to leverage single sign-on and role-based data access.

Reynolds also says the acquisition is the latest sign that standalone portal vendors are becoming a thing of the past. Plumtree Software Inc. is one of the last survivors of a once-promising sector, and even it now offers content, collaboration, and identity-management servers. Its top standalone competitor, Epicentric Inc., was bought late last year by content-management vendor Vignette Corp. Portal tools are increasingly becoming the domain of enterprise application vendors, which is precisely why Open Text made the move to buy Corechange, says Bill Forquer, senior VP of business development.

Lots of companies still haven't made final decisions on portal deployments, Forquer adds, and the reluctance to form multiple vendor relationships has them seeking out suppliers that can provide end-to-end collaborative tools. That makes it less than a surprise that Open Text has no plans to blend its LiveLink collaboration software with Corechange's Coreport product. The companies already had a partnership that resulted in some integration between the products, but Forquer says Open Text is committed to being portal agnostic, meaning it plans to continue supporting portal tools from the likes of IBM, SAP, and Sun Microsystems.

The deal, which doesn't require regulatory approval, was closed Tuesday.

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