Informatica Buyout of Siperian Good News for MDM Shoppers


Recently, I interviewed Siperian's senior director of product marketing, Ravi Shankar, and the company's new VP of solutions & field marketing, Kirk Millet, about multi-domain master data management. It's supposed to run next week.


Then yesterday, I receive an e-mail from Informatica: "Today, Informatica, the world's number one independent leader in data integration software, announced the acquisition of Siperian, a leader in Master Data Management (MDM)."


Things are changing fast in the MDM market, from this $130 million cash acquisition-the largest in Informatica's history-to the recent release of Talend's open source MDM tool. Rumors of IBM possibly acquiring Initiate, another primarily MDM vendor, also surfaced this week from the 451 Group, which had earlier theorized that SAP might also acquire an MDM company.


In an interview last summer, The Information Difference CEO and MDM analyst Andy Hayler predicted Informatica would acquire an MDM vendor. Instead, Informatica formed a partnership with Initiate, which in many ways is similar to and competitive with Siperian. Forrester listed both companies as "two MDM vendors to watch" in a 2009 report on PIM solutions -- available for free from MDM vendor Silver Creek Systems' Web site - and both both ranked as leaders in the third-quarter 2008 Forrester Wave evaluation of customer hubs.


So, Hayler was right, although who would have predicted Informatica would buy out Siperian, rather than Initiate?


Forrester principal analyst Rob Karel says he did back in 2008, adding in Thursday's blog post that the "impact this acquisition will have on the MDM market should be extraordinary to say the least." The deal will allow Informatica to "chip away" at major MDM players IBM, SAP and Oracle, but he adds, Oracle may be the most vulnerable in the long term.


Too bad for Oracle, but good for you, the end user, writes Karel:

This is only goodness for all MDM professionals. Now they have a truly application- and database-agnostic MDM giant they can consider as a viable alternative to the big three.

His complete analysis is long and thorough, with a look at how this will affect Siperian's existing customers.


Gartner's Andrew White, who follows MDM, was a lot more concise in his assessment, but writes that Informatica's acquisition as a positive sign for MDM:

The move is a great sign for the MDM market-it shows the growth we saw through 2009 (despite the recession) is attractive to vendors in related markets. Which vendors will get acquired next?

Bill Hewitt, president and CEO of MDM and BI vendor Kalido, issued this assessment via e-mail:

Informatica has long been rumored as a key acquisition target by one of the megavendors, but it has become increasingly clear that the megavendors have assembled their own stack of products to compete with their offerings. This acquisition is Informatica's attempt to level the playing field with IBM and Oracle by acquiring technology solely focused on managing customer master data, not every type of data. Informatica will level the playing field, but customers will be no more satisfied than they were before the acquisition.

He added Kalido is the "only independent MDM provider who can manage EVERY master data domain, giving customers the ability to have their master data management system match their business, not the opposite." However, the July Forrester report saw Kalido's MDM product not as a competing MDM solution, but "as a complement to operational MDM solutions like CDI and PIM because that operational master data can then be delivered through to Kalido's solution to then be consumed within analytical environments."


Incidentially, I asked Informatica's Ash Parikh about Informatica and MDM during our Q&A about Informatica 9. I didn't include his reply in the lengthy interview, but he ignored my hints about rumors, responding that "Informatica 9 is going to support MDM, the Informatica platform has always supported master data management, and it will do an even better job with Informatica 9."


If you'd like to see Informatica's official take on the Siperian acquisition, check out this video statement by Ivan Chong, senior vice president and general manager for data quality. It has all of the charm of a corporate training video, but he does explain why Informatica picked Siperian.


Informatica also posted fourth-quarter profits this week with license sales increasing 25 percent. Seeking Alpha published a transcript of the yesterday's earnings call. It's a mere 10 pages, so clear your calendar if you want to read it.