Editor's Notebook: Thoughts On Heartland, Canon Acquisitions

By The Business Solutions Network

When I set out to write our March issue’s special report on industry consolidation ("Channel Consolidation: Big Trouble Or Business As Usual?"), I had no idea we’d have so many real world examples to talk about so soon. Well, that’s not true exactly. Heartland’s recent acquisition of Dinerware and pcAmerica was the industry’s worst kept secret. Still, the rumors were floating around for so long, I began to wonder if it would ever happen. Of course, on Feb. 13 it did happen and the two POS software companies became part of Heartland Commerce.

Something that came to light in our March special report will be put to the test in the case of these recent acquisitions. Respondents to the survey we used to create the consolidation report experienced mixed results from the acquisitions of vendors they partner with. Some found that they had to deal with direct competition from vendors. Some found their territories full of new solutions providers now selling the same solution. In short, acquisitions can sometimes lead to difficult times for channel partners.

In the case of Heartland’s acquisitions, I’m very eager to see what happens. Insiders tell me that the software companies involved expect their channels to be unaffected at least and, at best, to gain all sorts of great things due to the size and capabilities of Heartland. However, our report shows that the benefits of scale are seldom experienced by the channel. Also, I'm interested in how the distinct personalities of Dinerware and pcAmerica fit (or don't) with Heartland's corporate culture.

But of most concern to me, Heartland has a checkered past concerning its dealings with the channel. Some months the company seems to be channel friendly, while in other months I hear from VARs direct sales horror stories and attempted strong arm tactics. I’m willing to give all involved the benefit of the doubt and will eagerly await feedback as time goes on. For certain, this acquisition can indeed lead to good things for channel partners and, hopefully, it will.

Another acquisition recently happened that was pretty surprising to me — Canon purchased leading IP video manufacturer Axis Communications for $2.8 billion. Earlier this year, Canon also bought video management leader Milestone Systems. These acquisitions, along with some other strategic moves by Canon make it a significant player in the highly fragmented surveillance world. Truly, this is a case of a company buying its way to market dominance.

However, Axis is an IP camera-only company. They never made analog cameras. Canon, on the other hand, has a long history in analog. As part of that long analog history is an existing channel program and partner base of traditional security integrators. What I’ll be watching here is to see how Canon handles Axis’ network-savvy IT integrators going forward. Also, Axis has a ton of very deep technical partnerships that Canon will now have to maintain and nurture going forward. Additionally, Axis is full of visionaries when it comes to network video. How will those visionaries fit into the Canon ecosystem? Finally, by no means was Axis a small company, but compared to Canon, Axis was the more nimble company. Will Canon get in its own way, or will it let the things that made Axis and Milestone great, continue?

Again, only time will tell.