Informa (INF.L) has acquired IHS Markit’s (INFO) TMT business. Informa Tech, which includes Ovum, will have revenues similar to Forrester’s $350m. It represents a dramatic shift in the analyst landscape.
Informa announced the transaction on 22 May as part of an exchange of Informa’s agribusiness service for IHS Markit’s TMT portfolio, including the OTT and media teams.
A sixty-year-old firm built through acquisitions, IHS its has absorbed numerous tech research firms, including Infonetics Research and IMS Research.
IHS Markit has clarified that it will retain RootMetrics and part of its market intelligence business. Because the exchange is subject to US regulatory approval, it can’t be completed until July at the earliest.
Informa and IHS Markit are similar firms and know each other well. Many colleagues at one have worked at the other, including the head of Informa agribusiness. Given the broad scope of their information services, ‘co-opetition’ is unavoidable in many areas. For example, IHS Fairplay was previously part of Informa’s Lloyds List business. As a result, we expect the transition to complete smoothly.
As well as a substantial base of business, Informa gains senior market analysts like Abel Nevarez, Clifford Leimback, Devan Adams, Diane Myers, Heidi Adams, Laura Aguilera, Michael Howard, Ruomeng Wang and Stéphane Téral.
Informa’s current TMT business, Ovum, will be dwarfed by IHS Markit colleagues. For example, the ARchitect analyst database lists 354 colleagues at IHS Markit in categories including IT, telecom, media, industrial, automotive, electronics, and solar: Ovum has 147. LinkedIn lists 1,000 colleagues in total at IHS Markit Technology, compared to 309 at Ovum. The heartland for IHS Markit is the USA, while Ovum is headquartered in London.
The exchange of assets is partly a defensive move. Both IHS and Informa have acquired extensively, and in doing so have complemented their long-standing roles as providers of industry data that spans multiple markets. In doing so, the businesses have developed profitability that Forrester can only dream of: Informa just reported operating profit of £732m on revenues of £2,369m. That’s double the firm’s revenue in 2015. Unlike Gartner, the firm is able to pay a regular dividend to shareholders.
From an analyst relations point of view, these purchases have been hard to understand. The integration of these businesses into the methods and content delivery platforms of IHS Markit and Informa has produced a degree of commodification and homogeneity, which has certainly led to a clash of cultures. Most importantly, AR professionals need to understand that the Informa business model is not Gartner’s. Measuring Informa Tech by how much it will resemble Gartner is a waste of time. Informa’s reach into the enterprise will be broader than ever.
As a result, Informa Tech will have a different value proposition to Gartner and Forrester. We expect its emphasis will be more on market data, events, lead generation and access to buyers than on inquiry calls and procurement support.