OpenText Pulls Ahead in Cyber Resilience with Carbonite Purchase

OpenText has completed its $1.42 billion acquisition of Carbonite, which acquired Webroot last year for more than $600 million.

Carbonite provides cloud-based subscription data protection, backup, disaster recovery and endpoint security to SMBs and consumers. It has more than 300,000 SMB customers, 14,000 MSPs and 7 million professional users.

The acquisition is a continuation of OpenText’s “total growth strategy” both through acquisitions and organic growth, the company said.

Mark Barrenechea, OpenText’s CEO and CTO, said Carbonite brings a “world-class channel organization and partners, allowing OpenText to bring enterprise information management (EIM) to all-size customers.”

In a Q&A with Channel Futures, Craig Stilwell, OpenText’s executive vice president/general manager of SMB and consumer, talks about what’s in store for partners now that the acquisition is final.

Channel Futures: What will this acquisition mean for OpenText’s various types of partners and will it create new opportunities for them?

Carbonite’s Craig Stilwell

Craig Stilwell: This acquisition really positions OpenText as the leader in cyber resilience, and cyber resilience is really about protecting endpoints as well as providing really robust disaster recovery. Protecting endpoints and protecting end users starts with training. There are a lot of bad guys out there who employ phishing techniques, and malware and viruses, etc., and knowing what to do and what not to do from an end-user perspective starts with security awareness training. But then bad things are still going to get through regardless of what an end user does and that’s really where the Webroot SecureAnywhere products, and their DNS and Wi-Fi protection, come into play to stop the bad things from happening.

However, occasionally bad things are still going to happen whether from malware or virus, or ransomware, or natural disasters, and so end users … need the opportunity to be able to recover from those incidents and this acquisition really gives OpenText a full suite of products aimed at making their customers more resilient. OpenText has a really large portfolio of products and several of those products, especially those that are security-focused, are going to make sense to bring into the SMB and consumer business unit right off the bat. At the same time, there are products within the Carbonite and Webroot portfolio sthat are going to make sense in big enterprise as well. And so there’s a bit of a two-way synergy going on, both up market and down market.

CF: Is this acquisition going to give OpenText and its partners a competitive advantage?

CS: Particularly in the SMB space, OpenText is now more dedicated than ever to partners, and so within the SMB group we are 100% partner-first and we are going to continue to leverage the network of 36,000 MSPs, channel partners, resellers and OEMs that we use to reach over 21 million end users. So we’re going to be extremely partner-first in our routes to market for SMB and consumer, and we were on this journey as part of Carbonite to bring Webroot and Carbonite together, and really consolidate partner programs and be easier to do business with. We have the opportunity to continue on that mission right now and make our partner programs more …

… consolidated, more streamlined, easier to work with and make sure that our partners are enabled in a way that’s going to help them serve their customers better, faster and with more robust solutions.

CF: Have you received any feedback from partners about this acquisition? What are they saying?

CS: There are a couple of things. You can imagine any partner who’s built their business around a certain technology or a certain company, or a certain set of technologies initially wants to make sure when there’s a big change that their business is OK and that their business is going to be protected, there aren’t going to be big surprises. So we’ve definitely spent a good amount of energy making sure the partners know right out of the gate it’s business as usual, nothing’s going to change as far as in the way you transact the Webroot product line or the Carbonite product line — or both in many cases. Partners are excited about bringing the two programs together in one cohesive program. The cyber resilience message has resonated really well with partners, I think they are excited about the technical integration of security, and backup and recovery technologies, which is well underway, and is going to allow them to serve their customers better and more efficiently by operating in the same console and taking advantage of a bunch of other integrations between the products. I think partners are excited about continuing to build out the cyber resilience portfolio, which we’re going to have the opportunity to do from all those great technologies that OpenText already had.

CF: From the Carbonite partner side, what will this acquisition mean for them?

CS: With these solutions coming together, no other vendor in the marketplace can provide the breadth of cyber resilience products to their end user customers, all the way from the end user training to the DNS protection, to the endpoint and server protection, as well as the disaster recovery/backup and recovery capabilities all under one roof. And so what this is going to mean to them is they have the opportunity to represent a very broad, very robust set of solutions that they’re not going to be able to get from any other vendor. And we’re going to continue to reduce friction in terms of just being easy to do business with and being able to put these products on one order, the technical integration that’s happening between all of these products and will continue to happen now that we’re under a bigger umbrella. So it’s an exciting time.

CF: What will be the process for integrating the two companies’ partner programs and channels?

CS: It was only in late March of last year that Carbonite had acquired Webroot, and so those technical integrations as well as integrations in those partner programs is still in flight, so we’re doing that integration and consolidation at the same time we’re integrating into the OpenText community. However, one of the things that OpenText has done is they’ve created this separate business unit, which I’m lucky enough to lead, which is the SMB and consumer business unit. And so within this business unit, we’ll have a set of products that are aimed at servicing that market and the channel programs will largely be run inside of that business unit. We’ll certainly have an eye toward not stepping on each other in the larger OpenText channel programs, etc., and we certainly expect a certain amount of …

… crossover from one partner program to the other, but the first order of business is to bring the SMB channel programs together in a consolidated, streamlined fashion. So that’s step one, and then step two almost at the same time we’ll make sure that we’re leveraging each other’s channel capabilities to the largest extent possible. But within the SMB business unit, we are 100% partner-focused, we are partner-first in our mindset and our approach to market. OpenText realizes that this is a very strong channel organization and we are going to continue to remain dedicated to the channel within this business unit.

What you should expect to see over time is more products coming into the mix, and we have product managers and our systems engineers collaborating … to identify what are the next candidates that make the most sense to bring into the SMB portfolio, as well as there are going to be some things that go the other way. So between being the leader in cyber resilience and also a leader in information management across not only the enterprise, but also down into SMB, it gives a lot of avenues for the bigger OpenText now to play.

CF: Has acquisition been a part of OpenText’s business strategy and are we likely to see it continue to be a part of that strategy?

CS: Absolutely. This is actually the ninth cloud-based acquisition that OpenText has done, which has resulted in an OpenText cloud that has literally millions of end users, and they’ve created a secure, but still flexible platform that supports innovation really at any scale, all the way up to enterprise and now down to consumer. And so with OpenText now adding backup and recovery, and at the same time endpoint protection, it really makes the OpenText cloud stronger, ensuring that customers can collaborate and innovate in a really secure manner. And from a channel perspective, it just gives us this much more robust portfolio that the channel’s going to be able to take to their customers and serve them better, and in a longer lasting and more meaningful way.