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Commentary: merger made in "dot-com heaven"

With this aggressive merger, and move into the next phase of their growth, Gartner says.

By Bernard Elliot, Gartner Analyst

With this aggressive merger, and have moved into the next phase of their growth. and were each start-ups that became leaders in their markets--large-scale messaging software for email and unified messaging, and enhanced wireless services and voice portals, respectively.

See news story: dials $6.4 billion deal for wireless software

The merged entity will position itself as a major player in a broader, unified communications market. It will sell into the wireless carrier market, as well as the application service provider (ASP) market. Most importantly, the merger will position the new firm as the leader in the emerging market of converged voice-data unified communications.

The merger comes at a good time for and as each company's market looks for enhanced services that the other company can provide. By combining their products, the two vendors can offer more comprehensive offerings. If they did not merge, and would likely have collided. For example, recently acquired OneBox, a leading communications ASP for unified messaging services--which is's niche.

The merged entity will position itself to become the leading U.S. and international maker of unified messaging and communications software for network service providers. The deal also creates a strong provider of unified communications services to the wireless market. and made a good choice in appointing Don Listwin as president and CEO of the new company. Formerly head of Cisco Systems' service provider and consumer division, Listwin will help to ensure a strong relationship with Cisco, which is an essential partner.

Cisco also presents a major challenge. Cisco already has a unified communications set of software, based on the acquisition of Amteva Technologies. Facing Cisco as a competitor would make a difficult market even more difficult. Like the unified messaging market, the unified communications market has proven a tough one to define and for which to create successful products.

(For related commentary on how wireless and high-speed technology will change the office, see registration required.)

Entire contents, Copyright © 2000 Gartner Group, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.