Ecologic Analytics’ acquisition by Landis+Gyr creates a bright future
Since 2007, Landis+Gyr has held a minority stake in meter data management (MDM) vendor Ecologic Analytics. Despite collaboration on pitches and product development, the two companies failed to drive as much MDM business as some of their competitors. After Toshiba’s acquisition of Landis+Gyr, and its subsequent acquisition of the remaining shares in Ecologic Analytics, the combined organizations are in a much healthier position to challenge their competitors for market leadership.
Since 2007, Landis+Gyr has held a minority stake in Ecologic Analytics
Ecologic Analytics has only been a going concern since 2000. Despite being just over a decade old, it is one of the first software companies to address MDM as an enterprise solution. It has clients in the gas, water, and electricity industries and claims to process over 500 million meter readings every day.
In 2007, smart meter manufacturer Landis+Gyr took a minority interest in Ecologic. Since then, the two companies have enjoyed a close relationship, primarily to seek joint pitches where possible. However, their collaboration extended beyond simple joint pitching. For instance, Ecologic Analytics helped Landis+Gyr design the first release of its GridStream MDUS (Meter Data Unification and Synchronization) product. SAP developed MDUS in conjunction with a number of meter manufacturers and MDM vendors to ensure close integration of meter data with SAP’s billing software, called IS-U.
The acquisition of Ecologic Analytics is part of a wider consolidation
In May 2011, Toshiba made a big splash in the smart grid industry when it acquired Landis+Gyr for $2.3bn. By 2011, Landis+Gyr had grown to be the world’s largest smart meter manufacturer, while Toshiba was one of the world’s largest power systems manufacturers. While Landis+Gyr had a strong portfolio of meters and related communications hardware and software, neither its original GridStream MDUS nor Ecologic Analytics gained as much penetration as competitors such as Itron with its Enterprise Edition MDM product. One possible reason was that Itron’s MDM solution is embedded within the Itron portfolio, while Ecologic Analytics was always a legally separate entity.
It came as no surprise that Toshiba’s acquisition spree continued in January 2012 with Landis+Gyr buying the remaining shares of Ecologic Analytics.
The acquisition of Ecologic Analytics is a good move for Landis+Gyr
Ecologic Analytics has always been a conservative organization. For instance, unlike many competitors, it will only talk about its capabilities when it has a live implementation. It is wrong to label the company an underachiever, but it certainly could have done better. Its acquisition by Toshiba/Landis+Gyr could well be the catalyst for a brighter future.
Post-acquisition, Ecologic Analytics can now be integrated with Landis+Gyr’s smart metering product set. While the two companies previously worked closely on product development (GridStream MDUS 2.0 is actually built on Ecologic Analytics’ MDM platform), the legal separation of the businesses posed a risk for potential clients. Utilities investing in smart meter infrastructure will certainly be wary of storing all of their customer data in a product run by a small start-up. But now that Ecologic Analytics is part of Landis+Gyr, which, in turn, is owned by an industrial giant, potential clients will see much greater security in the product.
In addition, the global reach of Toshiba could, for instance, help Ecologic Analytics to localize its products for use in a greater range of non-English-speaking markets. Prior to the acquisition, Ecologic Analytics was marketed mainly to the English-speaking world.
It is time for Ecologic Analytics to challenge the dominant players, Itron and eMeter.
