Customer Impact of Jive's Split

  • 30-Aug-2017

Yesterday brought word that Jive's new owners ESW Capital are divesting the external-facing "Jive-x" business to longtime competitor Lithium.  It comes as a bit of a surprise, since the rest of the "Aurea" technology portfolio assembled by the private equity firm consists primarily of customer-facing engagement solutions.  Although Aurea had assured customers upon the Jive Software acquisition four months ago that they were committed to the "Jive-n" internal community product, many licensees were skeptical.  But in the end, Aurea jettisoned Jive-x instead. So what gives?

One Technology, Two Markets

Unique in the social space, Jive produced platforms for both internal and external communities.  The two offerings worked roughly off the same core technology base, with some (mostly UX) differences around the edges.  Our sense, however, was that the internal platform — which typically accounted for two-thirds or more of Jive's revenues — drove most R&D, which then got extended to Jive-x.

Jive-x splitting from Jive-n

Jive-x sales actually seemed to fluctuate in an external communities market that saw ups and downs almost on a yearly basis.  The advent of public social networks almost wiped out "private-label" communities, but they make periodic revivals as some brands seek to engage directly with cohorts of customers and advocates.  The peer-tech-support scenario that Lithium targets always remained an enduring use case, and Lithium increasingly focused on that niche.

Customer Perspective for Jive-x

This is not a happy day for Jive-x customers.  While recent turbulence at Jive may have been unsettling, getting sold to a direct competitor (in many cases a competitor the customer evaluated and rejected) is not happy tidings.  Lingering concerns about Lithium's organizational culture, product management, and tolerance for technical debt only compound the anxiety.

Lithium itself is saying all the right things about supporting Jive-x customers.  The two platforms do target somewhat different scenarios, but there's also substantial functional overlap, and by my estimation, limited potential for combining modules and achieving ever-beloved "technical synergies."

Nevertheless, Lithium would be foolish not to closely support Jive-x customers, many of whom are paying more per page-view than Lithium's own licensees.  And the Jive-x ecosystem is probably more robust than Lithium's.  So I don't consider this a crisis for Jive-x licensees.  In the near-term, in fact, they will probably get a lot of love.

In the long-term, however, vendors selling multiple products that do mostly the same thing is a story that rarely turns out well.  One product becomes Cain and the other Abel. It's possible, though, that Jive-x will come out on top in this one.  Jive-x customers should wait and watch closely.

Customer Perspective for Jive-n

Some of RSG's subscribers who license Jive for internal social-collaboration services shared a sigh of relief today.  They've been on a bit of a roller coaster already over the past several years, but for now things will likely remain smooth.

Intriguingly, Aurea seems to see value in internal collaboration supporting external customer engagement.  This is different from the (largely failed) Jive approach of integrating internal and external communities.  Rather, it's likely about providing better services to marketing/sales/support/product/innovation teams trying to execute more increasingly complicated and inherently collaborative processes. 

If so, then for most Jive-n licensees — who frequently find customer-facing departments as major adopters — this is welcome news.

If your employer is an RSG subscriber and want to read our detailed vendor evaluation of Jive, find it here.  Wondering if your firm subscribes?  Check here.

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