OpenText Enters Into Agreement to Acquire GXS. Transaction Expected to Expand Information Exchange and Cloud Service Offerings.
Now for the rest of the story. If you have been following my series on David and Goliath, you know how giant GXS has been trying to bury Todd Gould’s Loren Data.
Goliath is in a tight predicament. If he swings his might weapon at David, he risks falling off the cliff he is on. In other words, cutting Loren Data out of the fragile INTERCONNECT game COULD send the whole EDI World into a tailspin. It could spell the end of the 20+ year old “traditional” EDI VAN. Wonder if Open Text is aware of this? I sure would not want to buy a company that had this “baggage” hanging on their back.
Supply Chains depend on EDI. When they send a transaction to be routed to a supplier or customer, there is an “Expectation of Services” from all service providers involved. If a service provider intentionally blocks transactions for any reason, are they not are guilty of obstructing commerce (much of it is interstate commerce…..listen up Federal Courts).
In the early 1970s MCI filed an antitrust suit against AT&T alleging that AT&T held a monopoly position in the telecommunications industry. A part of its claim was that MCI was unable to compete fairly against AT&T because of pricing and access control AT&T held. Consumers at that time had few choices in long distance carriers because AT&T restricted the ways that MCI was able to offer its services. All that changed in 1980 when MCI won $1.8 billion in damages from AT&T and the Department of Justice led the breakup of the Bell System. But what does that have to do with today’s supply chain?
In December 2010 Loren Data Corp filed an antitrust suit against GXS, Inc. alleging that GXS used its market position by denying Loren Data Corp competitive access to its network, while granting similar access to other competitors.