The follies of software vendors and services

Things happen in cycles it seems, and when you’ve been in an industry as long as I have, you see repeat patterns. So I guess it’s no real surprise then to see today that WCM vendor Sitecore announcing that it was acquiring one of its services partners Hedgehog. On the surface, that’s a strange move for Sitecore, which in the past had championed the idea of not competing with its implementation partner channel. But these are new times, with a new executive team, and Sitecore needing revenue growth. Rumors in the marketplace say that Sitecore isn’t adding new customers and is running out of existing customers to convert to subscription. It’s the obvious move. Even Mark Frost, CEO of Sitecore, said in their press release that the acquisition “supports Sitecore’s revenue growth.”

f course, there’s also some nice language about how it will help partners, too, but we’ve all seen this movie before. I wrote about this is 2015, when Ektron flamed out and was sold for dirt cheap to a PE and merged with Episerver.  Back then, while struggling for revenue, Ektron decided to build a services business, and while doing so cannibalized their partner channel. Sitecore is about to go down that same, very slippery slope. It will start with reassurances and platitudes about how this will help customers and partners alike, but soon, sales will get services quotas, and before long, they’ll be stealing services deals from their partners, and partners will flee the program. This will start the inevitable downward spiral, as partners will take their customers with them to other platforms. This is what happened to Ektron. This is what will happen to Sitecore.

So, if you are a Sitecore partner, beware. Smart Sitecore partners will start looking for plan B. Crownpeak would love to talk to any of you looking for a program that you can build your business on and won’t compete with you for services dollars. Come check out what a native SaaS CMS looks like: https://www.crownpeak.com/partners/become-a-partner

What about for Sitecore customers? Is this a good thing for you? Not really. While I respect Hedgehog’s capabilities, the fundamental problem with most vendor professional services team is that they think only about their own technology, not the ecosystem of solutions they must also integrate into. When you are a hammer, everything is a nail, and as a captive services team, they are now incentivized to recommend only Sitecore’s solutions (like their underwhelming commerce product or their train wreck of an email solution) for everything, not necessarily the best option for the client’s needs. Net, net: Beware and be skeptical about how a vendors services team approaches your solution and question their approach.

History is fond of repeating itself, sometimes it even rhymes. Those who don’t learn from the past are doomed to repeat it. I’ll be watching with a bag of popcorn.