Informix buys mobile database maker Cloudscape
Informix acquires mobile database maker Cloudscape in a stock exchange worth about $85 million, gaining the ability to pursue e-commerce clients but belatedly entering a crowded field.
With the move, Informix joins database rivals IBM, Oracle, Sybase, and Microsoft in the growing market for mobile databases, which allow remote workers to link to corporate networks via their laptops or handheld PCs. Manufacturers have embraced the segment as regular database sales have slowed and more and more people work remotely.
Informix chief executive Jean-Yves Dexmier said today's purchase enhances Informix's efforts to provide Internet-based products to businesses. The company recently shipped an Internet-focused database aimed at helping businesses create e-commerce Web sites, and also released e-commerce tools to help medium to large businesses create online stores.
Cloudscape, a two-year-old start-up, offers a mobile database built entirely in the Java programming language. It lets mobile users or branch-office employees to connect to headquarters to download the latest data, work offline, then dial in again to update and sync up with the corporate database.
The product also applies to e-commerce because the Cloudscape database can be embedded into applications, said Tom Henn, Cloudscape's president and CEO. As a result, a Web surfer can go online to an e-commerce site and download a product catalog with the database built into it. That way the user can view the catalog offline, he said.
"The idea is to have access to Web information without having to connect permanently to the Web," Dexmier said.
Analyst Merv Adrian of Giga Information Group said Informix bought a much-needed technology, but joins a very crowded market. Informix's competitors, such as Oracle and IBM, have built lightweight versions of their databases for the mobile market.
"Informix is late to a crowded market, but it's a market that aligns well with their installed base of users and their products," Adrian said.
Informix's existing users will cotton to the Cloudscape database, but the company needs to figure out a strategy to gain new customers, he said. Sybase currently owns 55 percent of the mobile database market and Oracle is second with 20 percent.
Meanwhile, where Sybase and Oracle charge for their databases, IBM is giving it away. "Informix is up against successful, established players. They have to think about what their penetration strategy will be," Adrian said.
As a result of the acquisition, Henn, Cloudscape's top executive, said he will leave the company to pursue other opportunities. An Informix spokeswoman said Cloudscape's 50 other employees are expected to join Informix.
Today's purchase is Informix's first since it settled shareholder lawsuits in May for $142 million. The settlement helped free up the company's cash reserves for potential acquisitions.
The shareholder lawsuits alleged that Informix and some of its officers and directors misrepresented the company's earnings outlook and inflated Informix's performance. The lawsuits were filed when Informix had to restate its earnings from 1994 through mid-1997.