WebEx – known for hosting online web meetings – has agreed to purchase Intranets.com for a mere $45 million. To put that in that perspective, that works out to a mere $150 per customer (300,000 paying users).

An online meeting company buys small market intranet hosting business?!?

WebEx conducts online meetings and competes with Microsoft’s Live Meeting. Intranets.com hosts small business intranets (less than 100 employees on average). In their press release WebEx states that the acquisition will allow them to “offer companies of all sizes a comprehensive, cost-effective, on-demand web collaboration suite that includes both real-time and asynchronous capabilities.”

One of the real drivers behind the purchase appears to be Intranets.com own web and audio conferencing service which it launched early last year. As PC World puts it, “The move was aimed directly at undercutting Microsoft's Live Meeting software and WebEx's service.”  In other words, Intranets.com was mowing WebEx’s lawn for a much cheaper price. WebEx isn’t cheap and Intranets.com was offering web conferencing at the low-low monthly subscription price of $199 (a license for up to five presenters).

I don’t blame WebEx for wanting to do away with Intranets.com. However, WebEx claims that Intranets.com will continue to run as a wholly owned subsidiary and plans to keep all 82 employees. Not surprisingly, WebEx is immediately taking over the Intranets.com web conferencing service. No doubt the price will go up sometime in the near future.

A little more perspective... if Intranets.com has 300,000 paying users, and judging by their pricing plan the average user price is about $10 per month, that equates to about $36 million in revenue per year. The company was sold for $45 million.

The sales price makes me wonder how viable the Intranets.com business has been. Very curious indeed.

Last week I blogged on “Microsoft’s Worse Kept Secret”: the merging of Sharepoint and Content Management Server (CMS) into a single group offer.

Well, Microsoft reminded me about the importance of perspective and point of view.

John Amyotte, a solutions specialist from Microsoft Canada’s portal group, offers the MS perspective on merging products into a single group. “Merging” and “group” yes,” says Amyotte, a 5-year veteran of the content management industry. “But they are still two separate products. The goal is for it to be transparent like Sharepoint portal and Windows Sharepoint services. And this is what a suite should be….one UI.”

Amyotte stresses that CMS is not disappearing. “Just to confirm CMS is not being phased out. In fact, the next release has more R&D funding going into it then the entire history of the product.

To be precise, hundreds of millions of dollars are being invested into the new Sharepoint and CMS bundling project with the offer due next Christmas (2006). 

“One of the challenges in the ECM and portal space is that if you want to create web content, manage a document, and collaborate with peers via email and instant messaging you end up toggling between numerous solutions that do not talk well to each other.”

To overcome the multi-client challenge Microsoft envisions a more user-friendly environment that allows the user to accomplish more without having to use multiple products or interfaces.

“Multiple user interfaces (UI's) across a large organization creates a user adoption challenge. Some vendors have tried to solve this challenge by acquiring other companies, but the reality is the products are written in various languages and never truly integrate. You still end up with multiple solutions and UI's that don't integrate.”

This of course is nothing new as others like Plumtree and Vignette already have integrated portal-content management-search products. However, Microsoft is not known for subscribing to the first-mover model (think of the browser, instant messaging, and content management and portal products to name a few).

But why settle at simply integrating two or three products? “The intent of the next release is to have a transparent integration between CMS, Sharepoint, and Office,” reveals Amyotte.   

“Users create content with the tools they use everyday such as Word or Outlook and the content can easily be used to create a web page on the external site, a document repository for collaboration, a confidential document on the global extranet, or a personalized announcement for the intranet also distributed via handheld devices.” 

Big things cooking in Redmond. But we’ll have to wait another 16 or 17-months before we can taste...

Well the cat is finally out of Gates’ richly tailored bag. Microsoft is now publicly hinting what so many knew to be true about a year ago (or more): MS is merging Sharepoint and Content Management Server (CMS) into a single group offer.

Bruce Dunwoodie was one of the first to report this on CMSWire. “In one of the first public statements on the topic, Chris Capossela, Microsoft’s group vice president of Information Worker Product Group, indicated that the future of the two products was around more common technologies and an integration, if not outright convergence,” writes the intrepid Dunwoodie.

“We do think of SharePoint and CMS very much together. CMS is running Internet sites, SharePoint for intranet sites and team collaboration,” says Capossela.

Of course this is not a formal admission which MS is shy to do. However, as I blogged back on April 10 (see Microsoft’s Intranet Portal Innovates), Gates & company are investing hundreds of millions of dollars and a dedicated team of some 300 people to beefing-up Sharepoint and fully integrating a new and improved content management system (Content Management Server as it is known today).

This is serious, serious business for MS. Gates et al are not intent to play second fiddle to Plumtree and IBM in the enterprise intranet portal market (if you call 31 million users a ‘second fiddle’) and understand that linking MS-Office and content management with a portal product and .NET could be a market clincher for them.... if they execute accordingly.

This new Sharepoint offering however will not be ready until December 2006 (planned date) which gives the competition a little lead time to up the ante.