Would EMC really buy FatWire?

  • 31-Jan-2010

From time to time, rumors surface about Web CMS vendor FatWire being up for purchase. Also, from time to time, we hear rumors about EMC Corporation being ready to acquire this or that content technology. Now there's a rumor going around fusing the two: that EMC might acquire FatWire.

As with most rumors about alleged impending acquisitions, we tend to discount this one. I certainly have no inside information. On the surface, it would seem to make little sense. EMC already markets a Web Content Management offering in Documentum. And FatWire's (roughly) $40 million-per-year revenues would add only a drop or two to EMC's $4 billion-per-quarter stream.

But I'll play devil's advocate for a moment.  We do know that FatWire and other upper tier WCM vendors have competed successfully against Documentum for new deals, occasionally displacing Documentum as incumbent. As with Open Text buying Vignette, EMC taking over FatWire would remove a competitor from the market, and give them more credibility in a strategic area where their own product seriously lags.

But the key factor for EMC is always storage. EMC is a storage company first and foremost. Almost every acquisition EMC makes (and it has made plenty: at least 38 companies since the December 2003 acquisition of VMWare) plays into its cloud or SAN storage stories. From a direct revenue-acquisition point of view, acquiring FatWire would not be strategic. But from a downstream storage-revenue point of view, it might very well be. EMC may know something we don't about how much money FatWire's customers are spending -- and plan to spend -- on storage.

Again, I have nothing specific with which to corroborate the EMC-FatWire rumor. However, it's interesting to speculate based on what we do know.  We know that EMC is on a multi-year, multi-dozen-company, multiple-billions-of-dollars acquisition spree; we do know that FatWire and others have been taking business from Documentum in the WCM market; and we know that FatWire has lately seen some key people leave (among them, CTO Dmitri Tcherevik and Director of Corporate Communications Rita O'Brien), which is sometimes a prelude to M&A activity. We know, too, that web content has been getting richer and bigger (driving people to spend more money on storage). And finally, FatWire does have a Documentum connector.

But still. EMC? Buy FatWire? Really?

Let's put it this way. Stranger things have happened.