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Posted by Rob Karel on June 2, 2009
Informatica today announced its planned acquisition of AddressDoctor GmbH, a premier global postal address data quality software vendor. AddressDoctor provides postal address cleansing and verification for over 240 countries through batch processing or real-time Web services, supporting 40 different character sets and can transliterate non-Latin characters including Greek, Cyrillic, Hebrew, Japanese, Chinese and Korean.
While AddressDoctor may not be a household name for many data management professions, data quality (DQ) platform and master data management (MDM) vendors certainly know it. Vendors such as Capscan, DataFlux, Datanomic, IBM, Initiate Systems and Siperian either OEM or resell AddressDoctor technology to provide address cleansing capabilities within their broader DQ and/or MDM solutions. Even perceived competitors in the niche postal address verification market like Experian’s QAS and Melissa Data have relied on AddressDoctor to expand their global reach for postal address data.
Informatica also had a prior OEM relationship with AddressDoctor, so the ability to provide global address verification is nothing new. Instead, Informatica says the acquisition will support their “Pervasive DQ” strategy and will allow them to more easily embed address validation within their Profiling, DQ Scorecarding and Monitoring solutions, in addition to its Informatica On-demand “cloud” services.
But I also see this acquisition playing additional strategic roles for Informatica. First, by acquiring what amounts to a market-hub of global address verification technology, Informatica has the full attention of many of its DQ and data integration competitors like DataFlux and IBM. While Informatica has of course announced that they intend to support these prior partnerships, the reality is DataFlux and IBM should be shopping around for another channel to provide these capabilities – too risky to rely on the good graces of a tough competitor.
But for me, the most interesting outcome of this acquisition is that Informatica further entangles themselves with already strong partnerships with the two leading pure play MDM vendors, Initiate Systems and Siperian. Last year, Iblogged on Informatica’s acquisition of identity resolution (IR) vendor Identity Systems, and it seemed obvious to me then that Informatica was looking to do more than just to enter the IR market and enhance its DQ offering. I suggested at that time, and I believe even more strongly today, that these acquisitions are just the appetizers for Informatica as they determine how they can most successfully enter the ever-growing MDM market - not just as yet another new entrant in a market full of “me too’s”, but as a legitimate contender to derail MDM market share leaders IBM, Oracle, and SAP.
Identity Systems, now branded as Informatica Identity Resolution, is certainly a great addition for Informatica’s data quality platform with its strong matching technology, but Identity Systems also remains the core match engine for Siperian’s MDM solution (among other MDM partnerships including D&B’s Purisma and Oracle). And now with the acquisition of AddressDoctor, Informatica also owns one of Siperian’s core data quality components. Add to that the fact that over 50% of Siperian’s customers use Informatica’s PowerCenter data integration platform to load data into the Siperian MDM Hub, it seems that Informatica is already directly influencing some pretty core parts of Siperian’s MDM success.
Informatica also has a solid partnership with Initiate Systems. In fact, Informatica even invested in Initiate, having participating in its last rounding of funding back in June 2008. It’s certainly feasible that Informatica could choose to acquire Initiate’s solid MDM platform instead, but the existing synergies between Informatica and Siperian still have me leaning towards that as the acquisition that can legitimately unseat IBM, Oracle, and SAP.
Of course all of this could be moot if Oracle decides to acquire Informatica to 1) resolve it’s noticeably absent data quality portfolio (beyond partnerships and OEMs), 2) give up trying to rationalize its Oracle-product-centric data integration portfolio (Oracle Data Integrator and Oracle Warehouse Builder) in exchange for a market-leading heterogeneous platform, and 3) eliminate the risk of Informatica entering the MDM market as a competitor. These rumors have been floating around for a while now, and I’m not convinced - but big pockets like Oracle have been known to do the most interesting things…