What the Ektron Drama Means for Customers

WCM vendor Ektron announced last week an additional investment by its largest backer, private equity firm Accel-KKR. You'll find conflicting reports about the exact nature of the deal, but clearly something big has happened.

Ektron says that Accel-KKR -- which already owned 30% of Ektron -- simply took a larger stake. Some older documents leaked to twitter suggest a complete take-over, amid rumors of a similar acquisition by Accel-KKR of EPiServer, an Ektron competitor. Much of this drama is inside baseball, and already the vendor-oriented analyst community is pondering this from an investor and supplier viewpoint.

Let's instead look at it from a customer perspective.

How Ektron Got Here

Though still a major player in the WCM space, Ektron has struggled in recent years. Many of Ektron's problems stemmed from choices made by its longstanding engineering and business leadership. One gets the sense that investors finally lost their patience, and want to accelerate their efforts to modernize the firm.

Whether it's a wholesale take-over or not -- and I suspect it will turn out to be a true acqusition in the end -- things will change for Ektron customers.

What it means for customers

This is a classic good news / bad news story.

Bad News

History suggests that after these sort of ownership shifts, customers can expect some turbulence in the short term, particularly around staff changes that come from further internal reorganization.

In the longer term, smaller Ektron licensees and those who haven't upgraded in recent years might get quietly sloughed off as the company focuses more on lucrative customers going forward.

Private equity owners typically focus on pumping more resources into sales, to try to dress up their portfolio firms for another acquisition by someone else down the road (though I don't foresee many plausible buyers for Ektron on the horizon).

If Accel-KKR does intend to align EPiServer and Ektron in some way, history also suggests that customers of both vendors will suffer, with Ektron licensees especially vulnerable. I'll explore this question in a subsequent post as events unfold.

Good News

In the near term, Accel-KKR will surely continue a journey already underway to professionalize what has traditionally been a sizable but family-run concern. Customers should welcome Ektron  becoming more predictable and less feature-of-the-month-focused on the engineering side. Barring a shotgun wedding with EPiServer, and if investors stay patient enough, the technology could eventually become more stable and more modern underneath the covers.

And remember: in today's WCM marketplace characterized by widespread functional similarity, what's under the covers becomes a major differentiator among vendors.

For more details on how Ektron differs from its competitors (especially EPiServer) consult our Web CMS Report system evaluations.

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Gil, Partner, Cancentric Solutions Inc.
iStudio Canada Inc.

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