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ebizQ's Business Agility Watch

Elizabeth Book

Today, "Yahoo! becomes a competitor to Google Inc., Zoho, Cisco Inc.'s WebEx and others that provide Web-hosted collaboration and communication suites."

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Our own Dennis Byron has been watching Zimbra for some time, but I don't think anyone predicted that it would be bought by Yahoo! for $350 Million. Yet another independent open source collaboration tool maker bites the dust.

Yahoo! Inc. (NASDAQ:YHOO), a global Internet company, today announced that it has entered into a definitive agreement to acquire Zimbra, Inc. (www.zimbra.com), a leader in next generation e-mail and collaboration software. Under the terms of the agreement, Yahoo! will acquire Zimbra for approximately $350 million.

"Our industry-leading communications products, including Yahoo! Mail, are critical to the future growth and success of Yahoo!," said Jerry Yang, chief executive officer, Yahoo! Inc. "Zimbra's tremendous talent and innovative technology will help to extend our core Mail offerings, further strengthening our strong leadership position in this space. Additionally, Zimbra's successful relationships with large ISPs are key as we expand our worldwide partner network and continue to focus on our commitment to being the partner of choice."

The acquisition of Zimbra will help Yahoo! to expand its presence in universities, businesses and through ISPs by enabling organizations to host e-mail on or off premises with their own domain. Zimbra's offerings include rich, AJAX-based e-mail, calendar, and contact management features that can be used both on and offline. Their open platform enhances the user experience by enabling creative mash-ups called Zimlets that tie in valuable Web services to e-mail, and can be tailored to fit the needs of every customer.

"We are excited to combine ourselves with one of the world's most successful Web mail services and extend Yahoo!'s credible brand and leadership in the e-mail business to universities, businesses and ISPs globally," said Satish Dharmaraj, Zimbra co-founder and CEO. "With Yahoo!'s ad and content network, the possibilities for Zimlets and other applications are endless."

Yahoo! Mail celebrates its 10th anniversary this year and continues to be one of the world's most popular Web mail services with 250 million(1) users worldwide. The service provides people with more ways to connect to their friends and online contacts and is fully integrated with Yahoo!'s many other popular services to make it easy to access all the Internet services people need.

"As an industry leader, we are constantly approached for different e-mail solutions," said Brad Garlinghouse, senior vice president, communications and communities, Yahoo! Inc. "With Zimbra, we will bring the security, reliability and anywhere access of Yahoo! Mail to people at school, work and home, further enhancing our leadership position in Web mail."

Following the acquisition, Zimbra will become a wholly-owned subsidiary of Yahoo!. Satish Dharmaraj will continue to lead the Zimbra team based in Yahoo!'s Sunnyvale headquarters and will report to Brad Garlinghouse. The transaction is subject to customary closing conditions, including regulatory approval. It is expected that the transaction will be completed in the fourth quarter of 2007.

ebizQ’s expert blog team covers a broad range of BPM, business integration, business analytics/monitoring, collaboration, content and related issues.

Peter Schooff

Peter Schooff is Contributing Editor at ebizQ, and manager of the ebizQ Forum. Contact him at pschooff@techtarget.com

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