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Consolidation in the cloud as OpenText buys Hightail and Carbonite grabs Mozy from Dell


Back in the early 2000s before Dropbox was gleam in Drew Houston’s eye, sharing large files was a huge challenge. Email services limited attachment size because bandwidth and storage were both expensive and FTP required a certain level of technical acumen. YouSendIt tried to resolve that problem by providing a way to share large files in the days before the cloud became a thing.

The company, which became Hightail in 2013, was sold to Open Text today for an undisclosed amount. Open Text is a highly acquisitive Canadian content management company. It operates almost like a private equity play, buying up older companies and living off of the assets, while incorporating them into the Open Text family of products.

Alan Pelz-Sharpe, founder and principal analyst at Deep Analysis, says Hightail is still solving that edge problem of moving large files around the internet, which has remained a problem even in the age of cloud storage. “Hightail was one of the few — though it largely went unnoticed — that focused on that problem. They essentially rethought FTP and filled a niche, particularly for creative media workers,” Pelz-Sharpe told TechCrunch.

The company counts 5.5 million customers with a strong emphasis on that creative professional market in advertising and marketing, which often have hefty files to move around between teams and clients. Hightail still provides them that ability.

Mark J. Barrenechea, who holds several titles at OpenText including vice chairman, CEO and CTO, says the addition of Hightail helps them meet yet another content management use case. “The acquisition of Hightail underscores our commitment to delivering differentiated content solutions in the cloud that enable marketers and creative professionals to share, produce, and securely collaborate on digital content,” Barrenechea said in a statement.

This could allow them to compete with Adobe, at least on the file sharing side. Adobe has a big stake in the creative market and providing solutions for creating and sharing the large files they produce.

Today’s acquisition comes on the heels of the sale of another early cloud company when Dell sold Mozy to Carbonite yesterday for $145 million. Mozy, a cloud backup service, which launched in 2005, was sold to EMC in 2007 for $76 million. You may recall that Dell purchased EMC in Oct 2015 for $67 billion. That deal closed in September 2016.

Mohamad Ali, Carbonite CEO and president, sees this deal as a way to expand Carbonite’s family of products. “This deal provides Mozy customers scalable options for the future and gives Carbonite a broader base to which we offer our solutions,” Ali said in statement.

Tony Byrne, founder and principal analyst at the Real Story Group says that both of these deals are indicative of consolidation in the online storage space. “Many of us hoped that these smaller niche players could provide pluggable services to other applications but in the end the big vendors just did that themselves. And they were too small and thin to compete with Box and Dropbox in the standalone market,” Byrne explained.

Featured Image: NicoElNino/Getty Images


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