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2018 Acquisitions: My Picks for the Top 10
When a company announces an acquisition, it can be hard to predict if it will be transformative or forgotten. For example, Cisco’s acquisitions of Webex (2007) and Tandberg (2000) significantly shaped the company’s collaboration business. On the other hand, few may recall that Microsoft acquired Talko (2015), or that Permira bought Genesys (2011).
There’s certainly good reason for M&A in enterprise communications. Acquisitions are usually the fastest way to fill a product gap, and with so many simultaneous transitions occurring in the market, there are plenty of gaps. Consider how the market was shifting in 2018:
- Premises-based to cloud-delivered
- Real-time to asynchronous
- Voice-dominant to omnichannel
- Monolithic to microservices
- Local to global
As a result of these transitions, there’s been a steady flow of acquisitions in 2018. I reported 51 acquisitions in 2018 in my Quipz newsletter.
Here’s my top 10 list of enterprise communications acquisitions announced in 2018.
- Avaya and Spoken Communications: Avaya hosted its biggest annual event in January 2018, just weeks after naming a new CEO and exiting chapter 11. The company was eager to send a clear message that reports of its death were exaggerated, and it did so with a surprise announcement to acquire Spoken, its BPO cloud contact center partner. The acquisition gave Avaya a multitenant implementation of its own Aura platform.
- Blueface and Star2Star Communications: The early 2018 merger of U.S.-based Star2Star and Ireland’s Blueface created a top five global, channel-first UCaaS company with more than 500 employees. Its official name is StarBlue, but the company continues to go by its pre-merger brands.
- Dialpad and TalkIQ: Dialpad liked its partnership with TalkIQ so much that it bought the company in May. With its new AI-powered speech technology, Dialpad became the first UCaaS provider to offer complete transcription of calls (see related video).
- Polycom and Obihai: Obihai ownership changed twice in 2018. In January, Polycom acquired Obihai, gaining a fresh endpoint lineup that includes phones and analog telephone adapters as well as a complementary cloud provisioning service. In July, Plantronics acquired Polycom in a significant business expansion.
- Ooma and Voxter: Ooma was well established in consumer and small business communications. Voxter engineered an impressive UCaaS solution that had attracted several tech-savvy enterprise customers. As a result of the March acquisition, Ooma has a comprehensive UC stack for businesses of all sizes.
- Slack and competitive aspects of Atlassian: Complex and clever, this July deal turned frenemies into friends. Slack not only clarified the competitive landscape for workstream collaboration tools by acquiring/eliminating Atlassian’s HipChat and Stride apps, but also gained development staff experienced in messaging. Atlassian exited its struggling messaging business and became an equity investor in Slack. The deal elevated both companies.
- Slack and Astro: This one hasn’t played out yet, but it’s becoming clear that workstream collaboration apps won’t replace email. Given its September acquisition of Astro, Slack apparently has concluded that if you can’t beat them, join them. Astro made an email app that was tightly integrated with Slack. Since Slack shut down the Astro app, it seems reasonable to conclude that the company intends to launch its own email capability.
- Vonage and TokBox; Vonage and NewVoiceMedia: These two acquisitions are separate but related and complementary, and they occurred one right after the other. Vonage announced its acquisition of TokBox, a video API provider, in August, and then cloud contact center provider NewVoiceMedia in September. The company has already demonstrated a video-enabled contact center, and it seems likely Vonage will replace its Amazon Chime offer with its own conferencing service powered by TokBox with its Nexmo dial-in network.
- Twilio and SendGrid: It’s not just Slack that sees a future in email. Twilio provides APIs for voice, text, and video. SendGrid focuses on email. Both companies empower developers with communications capabilities. Although the companies don’t have a strong overlap in customers, they see the potential to accelerate as a single company with a broader, diverse communications portfolio. Announced in October, this acquisition is expected to close in the first half of 2019.
- 8x8 and Jitsi: Atlassian likely acquired Jitsi to complement its messaging (HipChat and Stride) with WebRTC video. When the Slack-Atlassian acquisition music stopped, Jitsi found itself without a chair -- and that gave 8x8 an opportunity. It picked up Jitsi in October. That timing was right, but even better now with Microsoft’s recent move to Chromium.
My top 10 list is diverse. There are two video-related acquisitions (TokBox and Jitsi). Two email-related acquisitions (Astro and SendGrid). Two contact center acquisitions (Spoken and NewVoiceMedia). Two in UCaaS (StarBlue and Voxter). And, one in AI (TalkIQ).
Of the many acquisitions not listed above, I should mention three big ones:
- Mitel acquired by private equity firm: With this deal closed in late November, it’s too early to tell how much things will change.
- Plantronics and Polycom: I can’t tell if this acquisition will result in one operation or two.
- Cisco and BroadSoft: One of the bigger and more significant acquisitions, but I excluded it since it was announced in 2017, though closed in 2018.
Dave is a contributing editor and analyst at TalkingPointz.