Thursday, March 15. 2007

Pitney Bowes to Acquire MapInfo for for $408 million

Ok, well didn't see that coming! (press release) There'd been speculation for some time that Oracle or Intergraph or Microsoft might acquire the company, but I confess I never hear a rumor about Pitney Bowes. that goes to show, perhaps that I think of MapInfo as a GIS company and in fact it's more a "location intelligence" company to use its favorite term, or a "business to business" company to use my term.

Pitney Bowes is based in Stamford, Ct. (I think we had a NEARC meeting there once) and is described variously as the "the largest maker of mail-handling machines" and a "mail and document management services" company. So, it's basically another B2B company in what it calls the "mailstream" business. PBI (per its website) helps "companies manage their flow of mail, documents and packages."

As an "outsider" to location intelligence and business geographics I don't see a clear connection. I do see a link in geocoding and getting addresses correct, things related to mailing efficiently, but I don't see a direct link. What I do see is a link like General Electric wanted when buying Smallworld, one that allows selling more products and services into an existing client base: "We already sell them the hardware of energy delivery, now we can sell them the IT side of it, too." At PBI that might read this way: "We already enable their mail communications, now we can sell them products and services for location intelligence."

How did GE do in that venture? It's hard to say as GE Energy and the GIS portion is a tiny part of a very large company. I can say that Smallworld certainly left the GIS radarscreen for a while, though it popped up again based on an announcement at GITA of new solutions built directly on Oracle Spatial.

What of PBI and MapInfo? Well, the small part of a big company is still true: PBI has 34,000 "mailstream professionals" to MapInfo's less than 1000. Like Smallworld in the past, much of MapInfo's revenue comes from consulting (Thompson and Associates type work). I think it'll be PBI's ability to manage that side of the house is what will make or break the deal.

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PitneyBowes also bought Group 1 Software (fka Sagent, fka QMS) a couple of years back, so this isn't a complete surprise. The geocoding tools of Group 1 are the standard in certain industries such as insurance and financial services. This seems a more natural acquistion for PBI with MapInfo's focus on business intelligence.

#1 David Cole (Link) on 2007-03-15 10:31 (Reply)

MapInfo, through their business partners, has made significant inroads with a lot of police departments in New Jersey, and probably elsewhere. I wonder where this acquisition leaves the current PD installations, with the company apparently refocusing on business applications.

#2 Atanas Entchev (Link) on 2007-03-15 16:34 (Reply)

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