Pitney Bowes Sold ‘MapInfo’ to Syncsort. Or did it?

On August 26, 2019 Syncsort acquired Pitney Bowes’ Software Solutions Business.

For me, this wasn’t another acquisition transaction to read about and then move on to other matters. I’m writing this post because geospatial trends have been one of my focus areas throughout my insurance career.

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We live in two worlds: digital and analogue

Clicks and bricks. Online and offline. Digital and analogue. Bits and atoms. Take your pick. But realize that the key word in each of these two-word phrases is the word ‘and.’ We live in both of the worlds that these phrases characterize. Not one or the other but both worlds.

We work, conduct commerce, collaborate, and consume information, media, and entertainment in both worlds. The two worlds are becoming increasingly more interconnected and interdependent (and becoming more so as we continue to deploy IoT devices throughout the many physical and intangible facets of society).

Corporations need a mechanism to meet the needs of their clients who generate business between the two worlds. Pitney Bowes (PB) is one of the firms that provides that mechanism. (I am using a location intelligence visual from a PB conference.)

Tying the two worlds together

Pitney Bowes (PB) is a century-old company whose value-add is providing a bridge across the two worlds. Actually, PB is more than a bridge: PB offers its clients the ability not to just move between the two worlds but to also communicate, spatially communicate, between the two worlds. And it’s the second factor that is the focus of this post: PB is in the business of location-driven communications that tie the two worlds together.

PB acquires MapInfo in 2007

In 2007, PB acquired MapInfo. From the press release dated March 15, 2007:

Pitney Bowes Inc. (NYSE:PBI) today announced it has entered into a merger agreement to acquire MapInfo Corporation (NASDAQ: MAPS) for approximately $408 million in cash, net of expected cash on MapInfo’s balance sheet at the time of closing. MapInfo is the leading global provider of location intelligence solutions. In the next seven business days, Pitney Bowes will commence a tender offer at a price of $20.25 per share in cash for the outstanding common shares of MapInfo.

This acquisition strengthens Pitney Bowes’ position in the growing location intelligence market and enhances its ability to deliver added value to customers worldwide, according to Michael J. Critelli, Chairman and CEO of Pitney Bowes.

“At Pitney Bowes we have long understood the importance of location in connecting the right information with the right recipient. Increasingly businesses and governments alike are using location-based information to enhance their reach, performance and decision-making capabilities. We are excited about the acquisition of MapInfo because it leverages our current expertise in location intelligence to deliver a broader range of advanced solutions for retail, communications, insurance, financial services and the public sector as well as strengthening our customer communication management offering.

This transaction extends our global reach, enriches our location intelligence offerings, and builds upon the growing software platform that we established with the acquisition of Group 1 in 2004. We continue to expand our portfolio and leverage our core competencies as one of our strategies for delivering long-term growth.”

To be honest, even though that acquisition didn’t make 100% sense to me at the time, it did seem logical: PB helps it clients move physical artifacts from one geographic place to another. Obtaining ‘locational intelligence’ solutions from MapInfo enables the movement to be both more efficient and more effective.

(I also believe that location intelligence or geospatial or GIS, or whatever terms you use, is a “horizontal” geo-data and/or solution offering. It is a niche set of capabilities that can be deployed across a plethora of vertical industries. Other than ESRI, how many “geo” firms can thrive on their own without being acquired by another multi-industry technology firm, a data and algorithmic modeling firm, or a vertical industry firm that sees a competitive benefit in owning these types of capabilities?)

All that means I didn’t think MapInfo could last on its own for many more years beyond the 2007 PB acquisition.

Using MapInfo location intelligence solutions, PB expanded its customer-centric capabilities

PB added to the MapInfo location intelligence solutions by creating a variety of customer-centric solutions including a Customer Information Management solution and a video solution (EngageOne built on the foundation of PB’s acquisition of Real-Time Content in May 2015).

I was particularly impressed with the EngageOne Video solution and wrote about it and seven other video solutions in a May 2016 report titled “Eight Video Solutions to Improve Insurance Customer Experience.”

As I wrote in the report, video solutions enable insurers to create an “interlude of immediacy’ by engaging customers in a personalized, one-on-one manner. EngageOne offered that and more by embedding an interactive capability into the solution.

At time of my report, EngageOne provided PB the opportunity to take the company deeper into offering customer-centric commerce capabilities to insurers. The solution mixes together customer data from SoR (if the person is already a customer), SoE data (for existing and prospective customers), the customer’s responses to questions asked throughout the EngageOne Video session, location data, and data from other sources. (For more details about the EngageOne Video solution that I wrote about in May 2016, send me an email.)

PB sells its Software Solutions Business in August 2019

Back to the trigger event for this post: On August 26, 2019, PB announced the sale of its Software Solutions Business to Syncsort for $700 million.

From the PB press release discussing the sale:

Pitney Bowes Inc. (NYSE: PBI), a global technology company that provides commerce solutions in the areas of ecommerce, shipping, mailing, data, and financial services, today announced that it has entered into a definitive agreement to sell its Software Solutions business to Syncsort for $700 million in cash. The transaction is expected to close before the end of the calendar year, pending regulatory approvals and other customary closing conditions.

“Our software and data business has made great progress over the last few years achieving two consecutive years of growth and I am very confident of the prospects for this business going forward,” said Marc B. Lautenbach, President and CEO. “We have always said, however, if a business was worth more to someone else than to us, we would consider a sale. The sale of our Software Solutions business to Syncsort confirms that philosophy. Our software and data business, together with Syncsort, provides instant scale that creates value for our clients, partners, and the Pitney Bowes Software Solutions team.”

There was no mention of ‘MapInfo’ or location intelligence in the PB press release. However, the Syncsort press release about the acquisition stated they did acquire location intelligence, data enrichment, and customer-centric solutions (bold, underline emphasis is from me):

Syncsort, the global leader in Big Iron to Big Data software, today announced it has signed a definitive agreement to acquire Pitney Bowes’ Software Solutions business. Together, Syncsort and the Pitney Bowes software & data business becomes one of the largest data management software companies in the world and a leader in data quality, serving more than 11,000 customers and hundreds of resellers globally. With its unique scale and broader solution set, the company will offer differentiated capabilities to enterprises seeking to maximize insight from their data.

The acquisition, Syncsort’s largest ever, brings to the company best-in-class location intelligence, data enrichment, customer information management and customer engagement solutions that are highly complementary to its existing portfolio. The combination builds on, and significantly expands, the breadth of Syncsort’s offerings in data quality software and complements existing Syncsort Trillium products. The transaction is expected to close by the end of the calendar year, pending regulatory approvals and other customary closing conditions.

The Pitney Bowes software business is based on four key lines including:

Location Intelligence – products that allow organizations to enrich and analyze location data for enhanced business insights
Data Enrichment – comprehensive portfolio of business, geographic, and industry-specific data featuring global coverage across 250 countries and territories
Customer Information Management – software suite that manages data to deeply understand customers and their context to drive superior business outcomes
Customer Engagement – software to help businesses build brand loyalty, improve customer satisfaction, create new revenue opportunities, and reduce costs.

From both the PB and Syncsort press releases, it seemed to me that PB had, indeed, divested the (what could be reasonably construed as the) MapInfo acquisition that the firm made in 2007 and subsequently expanded with customer-centric solutions.

I realize that I might be mis-reading the announcements. One PB manager that I’ve known for many decades told me that PB did not sell ‘MapInfo’. Another ex-MapInfo manager said that his reading of the press releases was the same as mine.

Is PB fraying the ties it needs to connect the two worlds?

Three options in play describing the transaction

One option is that PB sold all of the location intelligence solutions that the initial ‘MapInfo’ acquisition had brought into the firm and that were expanded on since the 2007 acquisition.

A second option is that PB kept some of the location intelligence solutions and/or IP to use as a foundation for the firm’s future plans.

A third option is that PB didn’t sell any of its location intelligence solutions to Syncsort. I do not accept this option at all. Syncsort would have misunderstood what they acquired and would have to completely rewrite their press release.

Some proof that Option 2 is the PB choice

I hope that option two is the option that PB took: with or without the MapInfo capabilities, a firm like PB needs to have, and continuously improve, location intelligence to bridge the two worlds in which their clients conduct commerce.

I believe that PB actually did choose ‘Door #2’ for two reasons. (I emphasized what Baron does in point #2 below.)

In the press release about the PB sale of its Software Solutions Business to Syncsort, the “About Pitney Bowes” section includes that its clients depend on the firm for a variety of solutions including “…ecommerce fulfillment, cross-border commerce, location data; customer information and engagement software.”
As importantly, on September 3, 2019 Pitney Bowes released a press statement that stated that “Pitney Bowes (NYSE: PBI), a global technology company that provides commerce solutions in the areas of ecommerce, shipping, mailing, finance and data, and Baron, a worldwide provider of critical weather intelligence, today announced a multi-year partnership to combine Baron’s location-specific weather APIs with Pitney Bowes’ comprehensive portfolio of business, geographic, and industry-specific data. Together, the companies will work to create self-service data solutions delivering weather impact information at uniquely specified locations, tracking damaging events when and where they take place, and offering not just weather information, but enhanced weather data to insurance and property and casualty companies, underwriters, and shipping and logistics organizations.

Weather intelligence is best used in the context of location intelligence. The combination strengthens the geo-communication of moving physical artifacts between the two worlds of bits and atoms. Moreover, I don’t think it makes sense to have weather intelligence without having location intelligence capabilities.

My conclusion

PB is obviously slimming down through its sale of its Software Solutions Business that encompasses location intelligence and customer-centric solutions. But I believe they have kept some degree of IP (capabilities and solutions) in those areas.

PB has kept a hollowed out ‘MapInfo that had expanded customer-centric solutions’. I assume this particular jack-o’-lantern is what PB could currently afford to keep.

Effectively from my perspective, my answer to the question of this post’s title is ‘yes and no.’

What do you think?

Did PB divest MapInfo (not in name but by location intelligence capabilities and the accompanying customer-centric solutions)?

Let me know with your comments to this post in WordPress.