Attempting to establish and expand their presence in a growing, but immature, market, two large IT vendors, IBM and Informatica Corp., moved to acquire small master data management (MDM) software providers over the past week.
Yesterday, IBM said it would acquire MDM software provider Initiate Systems , a Chicago-based vendor focusing mainly on healthcare and public sector markets. Financial terms of the deal were not disclosed.
And, late last week, data integration software provider Informatica said it acquired MDM software vendor Siperian for $130 million in cash. Nine-year-old Siperian boasts a long list of manufacturing customers, including Daimler Trucks North America, and several large pharmaceuticals providers, such as Genentech, Bristol-Myers Squibb, and Pfizer.
IBM is expected to combine Initiate’s registry-style MDM software products with its IBM InfoSphere MDM server and related data management products. IBM said it would retain Initiate’s 347 employees. Though the bulk of Initiate’s 200 customers are outside of manufacturing, the company does claim some manufacturing users, including Mitsubishi Motors Australia.
Informatica’s acquisition of Siperian, meanwhile, brings that company into the MDM market for the first time.
“Our acquisition of Siperian will expand Informatica’s addressable market with an additional high-growth, adjacent technology category,” said Informatica CEO Sohaib Abbasi in a prepared statement.
Manufacturers and other enterprises use MDM software to model, cleanse, and unify data generated by a wide variety of source systems. MDM tools enable enterprises to create consistent repositories that are fed by data from different transactional systems. Often those repositories and the MDM tools themselves are specific to data domains such as customer or product data.
The market, which includes a variety of small vendors as well as large suppliers, such as SAP, Oracle, and IBM, is growing. A recent report by Baseline Consulting said that one-third of enterprises today have undertaken more than two MDM projects.
Yet, the Baseline report reveals customer dissatisfaction with MDM-focused systems integrators.
Experts say the MDM category remains immature, bogged down by unclear definitions and dissatisfaction with MDM projects. “Non-standardized — and often misleading — vendor messaging, combined with an abundance of underperforming end-user implementations, make scoping and planning an MDM initiative effectively all the more challenging,” said Forrester Research analyst Rob Karel in a recent report.