After a courtship lasting just about a month, Informatica has completed its acquisition of Nokia subsidiary Identity Systems for about $85 million in cash.
The deal will be finalized at the end of the month and Informatica will unveil applications incorporating Identity Systems’ technology within a month.
The purchase will bring enterprises a step closer to their dream of end-to-end data integration, which is critical in this global economy to take advantage of the economies of scale and global marketing.
It’s very difficult and time-consuming to manage and integrate data from different databases in multiple countries and often in multiple languages, and all vendors offer piecemeal solutions, so corporations are looking for solutions to rationalize and manage their data to let them manage and monetize it better.
Rationalizing and managing data consists of a complex set of processes: The data fields must first be matched, then merged and cleansed, and “you want to have a whole data quality process,” Henry Morris, senior vice president, worldwide software and services research at IDC, told InternetNews.com.
Informatica’s acquisition of Identity Systems will bring the company closer to providing an end-to-end solution for the data quality and data integration processes, Morris said.
The competition in this space is now focusing on “who can provide the best end to end solution for enterprise data quality and data integration processes,” Morris added.
The Players
Identity Systems offers identity resolution, which is a key enabling technology for various IT initiatives including data governance, master data management, customer data integration, customer relationship management (CRM), government intelligence, law enforcement and financial applications.
Its fuzzy algorithms have built-in support for more than 60 languages.
That technology is “perfect” for Informatica (NASDAQ: INFA), a leading player in the data integration space, many of whose users are working to get a single view of their customers across multiple languages and countries, Ivan Chong, general manager for Informatica’s data quality business, told InternetNews.com.
That’s because the first users of Identity Systems’ technology were the U.S. federal government’s Department of Homeland Security, and the Customs and Immigration Department, and “the technology had to be able to span large volumes of data, be very accurate and be very sophisticated,” Chong said.
Combining that technology with Informatica’s capabilities — Informatica lets users access data from various sources, including spreadsheets, and SAP (NYSE: SAP) and Oracle (NASDAQ: ORCL) databases — will result in “the only technology out there that integrates data integration, data quality and identity resolution,” Chong said.
IDC’s Morris doesn’t agree. “I don’t know that anyone has yet been able to put the pieces together for a complete solution because we keep extending the bar on what needs to be done,” he said.
IBM, which goes head to head with Informatica in this space, has “acquired Ascential, Informatica’s biggest competitor” as well as “the closest thing to Identity Systems – SRD, which was used in the casino business,” and is the major threat Informatica faces, Morris said.
Identity Systems architected its to be embedded in other applications — Oracle’s Master Data Management Suite uses it, for example — so integration with Informatica’s products will be easy, and Chong said the first integrated offering will be out within a month.
There’s a market for “something that’s able to analyze identity characteristics across very large repositories,” Burton Group senior analyst Kevin Kampman told InternetNews.com.
