The channel that Carbonite has created has emerged as one of the primary reasons OpenText decided to make the provider of a data protection platform and endpoint security software its ninth straight acquisition.
OpenText CEO Mark Barrenechea told industry analysts on a conference call that the channel Carbonite has built should provide a vehicle for expanding the market reach of OpenText’s existing portfolio of information management offerings, while at the same time exposing Carbonite’s backup and recovery platform and Webroot endpoint security software to more than 100 million end users that access an OpenText network to download software.
That cross-pollination should result in OpenText being able to recoup a $1.42 billion in cash investment to acquire Carbonite in less than 18 months, says Barrenechea.
“Carbonite has a superior channel,” says Barrenechea. “It’s one of the best I’ve seen in 30 years.”
Earlier this year OpenText acquired Webroot, a provider of endpoint security software, for $618.5 million. That deal followed the acquisition of Mozy, a cloud backup service, in 2018. Collectively, these deals position OpenText to close the data protection and endpoint security gap, says Barrenechea.
In fact, Carbonite already has 250 PB of data under management, with 50% of its customers coming from the midmarket, another 40% in the “prosumer” space, and 10% in the enterprise, says Barrenechea.
While Carbonite has built up a significant channel made up of thousands of partners over the last several years, it’s also been operating in the red. Carbonite restructured its channel earlier this year and then lost $14 million on revenues of $125.6 million in its most recent quarter, a 62% increase in sales. Steve Munford, formerly CEO of Riverbed Technology, has been the CEO of Carbonite while the company looked for a buyer.
Of course, no matter how superior the Carbonite channel may be channel partners are not under an obligation to attach OpenText products and services to existing Carbonite deals.
Many will wait until they see what types of incentives OpenText will provide, especially if channel partners already have rival offerings in their portfolio. In the meantime, as OpenText continues to evolve into a provider of information management software and services, it will be interesting to see how a very diverse portfolio of platforms eventually becomes more tightly integrated.
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