Blogger: Guy Creese
On September 15, Adobe announced that it was buying web analytics vendor Omniture. This solves some short-term issues for both companies. Adobe’s revenue is down, and Omniture’s annual revenue of $300+ million will bolster that; Omniture wants to call higher and leverage Adobe’s many offices as a way to increase sales.
The financial analysts were all aflutter over the short term implications. Some weren’t quite sure where the synergy was (“OK, explain to me how a company that sells Dreamweaver needs web analytics.”); others felt Adobe paid too much (I’m inclined to agree, but knowing Josh James, I’m not surprised he got a good price); and others said Microsoft, Oracle, and others might top Adobe’s offer.
However, assuming the deal goes through—and I think it will—what does this mean in the long term? It means that we’re finally starting to see some market movement towards content analytics: that is, creating a feedback loop that monitors content creation and consumption as a way to help enterprises create more relevant content at a lower cost.
I discussed this concept in a Burton Group report three years ago: Content Analytics: Assessing the Value of Corporate Content (Burton Group subscription required). In the analyst call announcing the planned acquisition, Adobe said their customers were telling them that while they could monitor what parts of a web site or Flash application users were clicking on, they needed this analytics capability to be better integrated with the content creation process. Customers, Adobe, and Omniture typically discuss this integration work within the context of web site content—not surprising, since both Adobe and Omniture focus on this area.
However, there’s nothing to say that this integration work couldn’t expand to other areas, such as Adobe’s SaaS solution (Acrobat.com), digital images, documents. And in fact, in a call I had last week with Adobe and Omniture last week on the acquisition, they said as much to me. Both companies have a much broader vision of where this will ultimately go than was apparent in last week’s news coverage. This is the real long term value of this deal—expanding the creation/analytics integration work so that all digital content types are instrumented and monitored as a way to deliver the most relevant documents at the lowest cost. Put another way, in the long run, Adobe could use real data to tell you whether it’s worth spending three hours honing this project report—or whether you should spend only 20 minutes on it so you can move on to other work that will have a better payoff. That’s the path that Adobe is starting down, and that’s a good thing for enterprises.