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Kana and Broadbase Merger Bears Fruit in a Ripe CRM Market

REDWOOD CITY, CA—The Customer Relationship Management (CRM) market was and still is ripe for consolidation. So say analysts at AMR Research. They point to the recent merger of two troubled companies as a harbinger of things to come: CRM vendor Kana Communications and market analytics software maker Broadbase, which joined forces last week in a stock deal reportedly worth about $75 million.

Redwood City, CA-based Kana Communications provides Web-architected enterprise relationship management solutions (eRM). It delivers integrated e-business and interaction applications, with a modular and scalable platform for both Internet and Global 2000 companies. Headquartered a few miles to the south in Menlo Park, CA, Broadbase Software provides customer-focused analytic, marketing automation, and e-service software applications that analyze customer data from multiple touch points, and use that information to execute marketing campaigns, improve online merchandizing and content, increase site stickiness, and personalize customer interactions.

Between them, the two companies will have a base of more than 1,300 customers, including American Express, Bank of America, Boeing, British Airways, Cisco, Fidelity Investments, Ford, General Motors, Hewlett-Packard, MCI, Microsoft, Nokia, Sprint and United Airlines. The merger agreement is subject to shareholder approval and is expected to close in the third quarter. The combined company will be called Kana Software. Chuck Bay is slated for the positions of president and CEO, and Jay Wood will serve as chairman.

"Customers are demanding a relationship management solution that creates extraordinary relationships," said Jay Wood in a media release. "This requires the combination of analytics, knowledge, marketing, and service with a scalable e-Business platform. When we look at the combined strengths of the Kana and Broadbase product offerings, we have a unique and unbeatable eRM [Enterprise Relationship Management] solution."

About the Author

John K. Waters is a freelance writer based in Silicon Valley. He can be reached at john@watersworks.com.

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