Acquia Announce the Acquisition of Widen

Acquia Widen

Yesterday, Acquia announced that they intended to buy up DAM vendor, Widen Enterprises.  The following is by Mike Sullivan, President and CEO of Acquia:

“With Widen, we continue to differentiate Acquia Open DXP by adding enterprise-grade, cloud-native DAM and PIM capabilities.  We will immediately invest in accelerated development of the Widen solution, and leverage our global capabilities and partner network to bring it to marketing organizations that use Acquia Open DXP to manage, transform and deliver digital assets at scale.” [Read More]

There is also an FAQ about the tie-up on the Acquia site and a blog post by Widen CEO, Matthew Gonnering.

We plan to write an extended briefing about this acquisition for DAM News Premium Subscribers in the next few weeks, but I have gathered together some early thoughts for the benefit of all our readers.

Firstly, this isn’t a complete surprise, last year I wrote an article entitled The End of The ‘Roy of The Rovers Era’ In The DAM Software Market, which a number of vendors and investors contacted me about, mostly to concur with what I had written.

While the rate of innovation in the DAM software market has been in a slump for a number of years, one area where that has been a lot of progress is integration across the Digital Asset Supply Chain, especially between DAMs and marketing technologies of various kinds.  The firms which have invested in this area have effectively advertised their existence to a wider potential audience, both internally within their current clients and to the counterparties they partner with (as well as all their competitors).  As such, it makes sense that a lot of platform integration has led to some business integration also.

Some years ago, consolidation was fairly widely predicted in the DAM market and there was an expectation that vendors would begin merging with each other.  While the Acquia/Widen deal is a form of consolidation, it is closer in nature to Sitecore’s acquisition of Stylelabs or Aprimo buying up ADAM rather than DAM vendors hooking up with each other (as happened with Bynder and WebDAM).  The general theme is an impatient larger suitor needing to be able to offer a more extensive DAM capability after either having grown weary of trying to do it themselves, or just not wanting to get involved with the hassle and risk to start with.  Simultaneously on the DAM vendor side of the equation, it is a realisation that the DAM market isn’t growing at the pace that some claim it is.

To support this assertion, I note that Acquia had their own DAM platform, Acquia Digital Asset Manager, which they launched several years ago to try and get a slice of the action in DAM.  You can still find references to it on their website (and it is telling that most of the people who were involved in the marketing of it are now described as ‘former employees’).  As to Widen, I noted a couple of years ago that they were being true to their name and expanding their own scope of services to include design, consulting as well as new PIM products.  These all point to issues growing revenue from core markets, indeed, one of the likely reasons they are in the DAM software business to begin with is because their previous specialism (print and plate-making, I believe) was also becoming a bit of a cul-de-sac.

The second issue relates to the dynamics of the DAM software market as it stands in 2021.  Most experienced DAM vendor sales people I talk to will acknowledge that nearly all prospective enterprise clients have already implemented Digital Asset Management initiatives at least once before (and frequently more than just once).  As such, the market is now mainly a replacement-oriented business with vendors essentially exchanging enterprise clients with each other every few years.  These are indicators of a sector that is reaching maturity and which is finding growth opportunities hard to come by.

In summary, the commercial logic for the deal is a larger VC-backed vendor with wide-ranging ambitions who have just been given a lot of cash to grow as fast as they can across the entire digital supply chain, versus an organically-reared niche player who don’t see much potential to take the business further forward under their own steam (and certainly not by sticking to DAM alone).  I have no doubt that Widen had a few options in terms of potential suitors, but irrespective of how many offers were on the table, the fact they felt they had to take one of them was practically inevitable (while acknowledging the famous AJP Taylor aphorism).

Will this transaction work out for both Widen and their current customers?  This is one of many critical questions that need to be asked.  The removal of Widen as an independent vendor might also present an opportunity for their remaining pure-play competitors.  These are topics which I will have to defer consideration of for today, however.  Anyone who is eager to know more should sign up to become a Premium DAM News Subscriber and I hope to enlighten you further in due course!

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