Why CA Acquired Nimsoft
Hey Folks, sorry for the delay in posting this one. It’s been in my draft folder for a couple of weeks now.
I recently read the Network World article titled, “Cloud or customers? Why CA wanted Nimsoft” by Denise Dubie. I thought this announcement deserved a bit of comment.
I did some recent searches in Google News. Found some interesting quotes:
“The [Nimsoft] acquisition immediately strengthens CA’s position in the mid-market, while allowing them to grow their managed service provider business,” a recent research report reads. “Over the last two years, CA did a good job of gradually changing its reputation from a company that is making acquisitions just to improve its revenue stream (or get emerging competitors out of the way) to a vendor that has a very clear vision, and it is buying only the missing pieces to a large puzzle they had envisioned.”
“”This presents a major test for CA to prove once and for all that it is no longer a company ‘where software goes to die,’” the report reads.
“CA obviously sees the cloud computing as a high potential investment, but isn’t it too early to be putting so much faith in it, given that there is no consensus even on its definition?”
So, by my count we have seen CA purchase the following companies — 3Tera, Oblicore, Cassatt, Nimsoft, NetQoS, Concord (eHealth/Spectrum). This has all been since 2005. It kind of makes you wonder what you would have been buying from CA prior to 2005. I wrote about the CA acquisition of NetQoS in the blog post, “The Performance Management Market and Customer Portals.” If you read that blog post and then consider the Nimsoft acquisition you’ve really got to ask yourself, “what is this strategy?” Between Concord eHealth, NetQoS Net Voyant and Nimsoft you now have three overlapping products in the performance management space. You have two overlapping event consoles. Two different topology solutions. As a prospective CA customer, I would certainly be wondering what solutions are going to come out on top.
Anyone who has read my blog posts knows that I am not a fan of the acquisition based strategies. The acquiring company is left with a disparate set of code bases that were written in different languages with different front ends, different back ends, different device entity stores, etc. The late 1990’s and the early part of this century were the time of best of breed. If you can remember back that long, then you certainly remember how long it took to deploy these solutions. How is a monitoring and management strategy built upon mass acquisitions any better? It is still an integration nightmare. Also, how do you know what technology is going to come out on top? Is it really the best technology? Do you really think the deployment and maintenance of this hodge podge of code is any easier?
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CA, Nimsoft, Monolith Software, Acquisition
If you’re not a fan of “best-of-breed” or single vendor solutions, what approach are you advocating? Best-of-breed and single vendor solutions cover the majority, if not all (with the exception of home grown tools), of the management solutions which have been implemented.
You made me think. I am not sure what type of consultant you are or were but here is what I learned doing what you describe so well in your blog. There are many types of folks in technology. Two types that I learned to know are the operators and the business folks. The best presales guys are operators and the folks that buy and sell companies are business folks. We, the operators, raise the value of the company. While the business guys look at the bottom line. When I worked at CA, I could address any enterprise management challenge posed by a prospect or customer. The sales guys knew this, customers knew this, and I knew this. I was very busy ensuring that CA closed business. I left CA (for Nimsoft) because there were no leadership positions for someone like me. When I worked at Nimsoft, I had one product, addressed specific needs, wasted no time in areas I could not address, went to sales club for the first time as a presales guy, and Nimsoft laid me off less than six months later. The business guys want to maximize profits; the operators want to address prospect/customer challenges.
CA acquired Nimsoft to maximize profits. With Nimsoft, CA addresses the needs of more prospects, acquires Nimsoft customers, and gains more business with minimal investment. Nimsoft sale to CA provided profits to the private Nimsoft investors while providing little to the operators. The lesson I learned in my years as an operator is that the business guys seldom appreciate the operator’s job – they are too far removed from the operators. It is simply not in the operator’s nature to focus on the business of the software company. I believe the business guys know this and the results appear all the time. The CA/Nimsoft deal made it very clear to me.
I remain a happy operator. Best wishes to you and keep posting – good stuff.