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West Acquires INXPO

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West Acquires INXPO
    

By: -
13 Sep 2018
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Setting off what could now be called a streaming-technology acquisition spree, West Corp. has announced plans to purchase webcasting event rival INXPO.

Terms of the deal, which is expected to close by mid-October, were not released. However, West likely paid far less for INXPO than the $335 million spent by the company to acquire the webcast services unit of NASDAQ OMX in January.

Taken together, though, the NASDAQ and INXPO acquisitions represent a dramatic transformation of West’s Digital Media Services unit. NASDAQ’s large customer base added significant heft to the revenue stream generated by West’s webcasting business while INXPO infuses a more modern technology platform that likely becomes the flagship product of West’s webcasting business.

West itself was acquired by private equity group Apollo Global Management in October 2017 – a deal that appears to have given West deeper pockets to pursue acquisitions that grow the company’s webcasting operations.

In the case of INXPO, West’s management team certainly had a very clear-eyed view of what the company is getting in its latest acquisition. Ben Chodor, the executive who now leads West’s Digital Media Services unit, last year worked as a strategic advisor for the INXPO management team.

Chodor was not available for a briefing following the announcement of the deal, but in previous conversations with WR, he has described INXPO as a perfect fit for West. Both companies have similar development trajectories with long histories in providing managed webcast services as well as “virtual environments” used for online trade shows. Both companies also have taken steps in recent years to develop their business in selling licenses for self-service versions of their streaming platforms that organizations use to produce webcast events on their own.

The primary difference between the two is that less than two years ago, INXPO launched a major update to its product offerings, introducing a streaming platform based on the HTML5 markup language. The INXPO platform is far more advanced than the technology solutions currently offered by either West or NASDAQ.

While no formal product roadmap has been revealed in conjunction with the INXPO deal, I would expect that in the months and years ahead, West will try to convert most of its existing customers to INXPO’s HTML5 platform.

Assuming West executes in this manner, I see this deal as creating significant upside for the company’s webcasting unit. If you think of the existing webcast business as the equivalent of an old functional warehouse, the addition of INXPO would be like adding some drywall, a fresh coat of paint, some new duct work and exposing the pipes – a refurbishing effort that converts the space into trendy, more appealing apartment lofts.

The combined entity will still have a webcasting software solution tuned primarily for use in outbound business communications and marketing applications. But if West combines its current strong relationship with networking add-on provider Kollective and marries that with aggressive promotion of the INXPO platform solution, the company could emerge as a more potent rival for streaming platform deployments behind the firewall, as well.