Myriad on track with Synchronica integration
CEO upbeat as company consolidates around single technology platform
Zurich-listed Myriad Group, which acquired push email and messaging specialist Synchronica for about $38 million back in April, is on track with its integration strategy, according to the firm's CEO, Simon Wilkinson.
Myriad, which specialises in mobile software and apps, acquired UK-based Synchronica in April after gaining acceptance from shareholders representing 80.68% of the target's ordinary share capital.
Since the deal was announced, Myriad has been working to integrate the technology platforms of the two companies. "The integration is going well," Wilkinson told CommsMEA. "We've been very aggressive in terms of integrating and restructuring the company and I guess one of the benefits of a drawn out acquisition process was we had more time to plan," he said.
"Post completion we set ourselves a very aggressive timeframe on technology decisions because there were multiple platforms in the companies. [...] We are consolidating around a single core platform while getting the best features of the other platforms."
Wilkinson added that Myriad had also reduced the headcount of the combined entity by almost 200 people, leaving the firm with about 600 staff globally. "Consolidation and optimisation of the cost base was always part of the strategy for the acquisition," he said.
Myriad offers a range of mobile apps and software to operators and handset producers globally, and Wilkinson said that the company's main revenue stream remains its devices business, which sees it licence software including messaging and browsing apps to handset manufacturers.
The acquisition of Synchronica added push-email and instant-messaging software, and about 90 customer deployments, to Myriad's portfolio.
The acquisition also offered some reassurance to customers of Synchronica, which had passed through a turbulent period in the months running up to the deal, including the resignation of founder and CEO Carsten Brinkschulte, and chief operating officer Nicole Meissner, in September 2011.
"We have and a very positive response from Synchronica customers that they are now being serviced by a larger, more mature, better equipped organisation, and from the Myriad customers as well about the broadening of our product portfiolio," Wilkinson said. "A lot of this acquisition was about acquiring scale in customers."
The acquisition has allowed the company to return to existing customers with new products and services, which is particularly useful in a sector with notoriously long sales cycles, according to Wilkinson.
Myriad expects the addition of Synchronica's products to accelerate the growth of its social networking and messaging apps to the extent that by 2013, this side of the business will represent the company's core revenue stream.
Indeed, Wilkinson sees social networking as a key driver for the company, not least because its products make Facebook accessible on even the most basic handsets. "We feel that we can add some significant value [to Facebook] especially in the Africa Middle East region in helping them grow subscribers. Myriad Updates allows Facebook for the first time to touch a subscriber who doesn't have a data plan, a smartphone or even a phone that has a GPS connection," Wilkinson said. "We are just about to launch with an operator in Africa that has 6 million subscribers and that country only has 130,000 Facebook users, so we really do think we can add value to all elements of the chain."
The Middle East and Africa region was a prime focus for both Myriad and Synchronica, with both firms having a significant number of contracts in the region. In 2011, Myriad inked a breakthrough deal in Africa when Orange ordered a deployment of Myriad's Self Care product, which delivers Facebook over USSD, for its African operations. The product is already live in Egypt and Ivory Coast, and all of the properties will be "up and running in a short period of time" according to Wilkinson.
Synchronica also signed a key deal in 2011 to deploy its push email and instant messaging software for all of Bharti Airtel's African operations in June 2011. However, Airtel appeared to stall the deployment of the service - possibly owing to Synchronica's internal strife - although this is a situation that has been rectified, according to Wilkinson. "We are launching at the moment. Synchronica was constantly stretched and under-resourced. We have been able to deal with that, put competency in where it is needed and add the marketing and go-to-market proposition as well. Airtel was stalled as a customer of Synchronica. We have, in a short period of time, been able to fix that," Wilkinson said.
Myriad has also been focusing on Nokia's former North American messaging business, which was acquired by Synchronica in June 2011. This unit offered messaging services to Nokia users across about nine North American operators, but had languished as it was not the handset maker's primary focus. Myriad has integrated this unit into its own North American organisation and hopes to reinvigorate the business by offering new products across a wider range of devices.
"We have upgraded the sales organisation there, spending a lot of time with those North American carriers. It wasn't shown that much love and attention because Nokia's interests were elsewhere in their own-branded proposition. Our challenge now, as well as our opportunity, is to reinvigorate those customers with new propositions and re-grow that subscriber base," Wilkinson said.