Fluke is careful in its announcement of the acquisition to call the two companies' product lines "complementary," but I don't really see it.
Today, I received a press release announcing that Fluke Networks (www.flukenetworks.com) has acquired Microtest (www.microtest.com). Both make LAN certification testers, and operate in a compact and very competitive market sector. This is a bombshell, even in the changeable LAN-tester market. What does it mean?
To answer that question, we have to review a little history. It will be recent history, though, because LAN testers haven't been around for that long.
In early 1994, Wavetek was offering its LANTech 100, Microtest came out with its PentaScanner, and Scope Communications was shipping its WireScope 100. Datacom Technologies had a 100-MHz tester in the works, but Fluke wasn't even in the lineup at the time. A year later, Fluke Corp.-Fluke Networks is a recent name change-introduced its DSP tester at the January 1995 ComNet trade show.
Since that time, these five companies have entered into what has looked like, to me at least, one of the most intense competitions for market share that could be found in the cabling industry. Fluke, for instance, touted its use of digital versus analog technology in its claim to superiority. More recently, Microtest has vaunted its S-band technology as its distinguishing feature.
Just five years later, the competitive landscape for LAN testers is completely altered. Wavetek merged with German fiber-optic test-equipment maker Wandel & Goltermann. W&G, since renamed Acterna, then sold its LAN-tester line to Ideal Industries. Scope Communications, which could best be characterized as five engineers and someone to answer the phone at the time I visited its Massachusetts headquarters five years ago, is now the Wire Scope Division of tester giant Agilent Technologies.
Datacom Technologies has undergone perhaps the most tortuous history of all. First acquired by Textron, the parent company of Greenlee Textron, Datacom Textron, as it was renamed, became one of half a dozen Textron-named subsidiaries in the cabling industry. Last year, Textron acquired fiber-optic test equipment maker RIFOCS Corp. and merged Datacom Textron's Everett operations into it, with most of the Everett personnel being let go.
Fluke and Microtest have been the two independents not gobbled up by larger test-equipment makers in the M&A feeding frenzy. But perhaps we should have seen this consolidation coming earlier in the year, when Fluke Networks acquired fiber-optic test equipment maker FOTEC.
One suspects that Microtest would welcome the buyout because it felt it couldn't compete with big fish like Agilent and Textron. But why would Fluke pursue it? My opinion on that: one less competitor. Now there are four players in the market, not five.
This might mean bad news, in the long run, for OmniScanner afficionados. Fluke is careful in its announcement of the acquisition to call the two companies' product lines "complementary," but I don't really see it. They both make LAN certification testers; until yesterday, they competed head-to-head.
In the "Frequently Asked Questions" section of the acquisition announcement is the question: Will Fluke Networks retain the Microtest name and branding? The answer is instructively non-commital: "Fluke Networks will evaluate the best way to integrate the Microtest brand while maintaining the quality features and attributes that Microtest's customers have come to expect."
Here's my view, in a nutshell: Fluke Networks is a fine company, and it will honor Microtest's ongoing commitments to its customers, but the Microtest product line-also the work of a fine company-is history. That's what I read between the lines of this announcement.