To Our Valued Customers:

On March 15, 2007, Pitney Bowes announced that it has entered into a merger agreement to acquire MapInfo Corporation.

I firmly believe, as does our management team and Board of Directors, that this is the right move, at the right time, with the right partner – Pitney Bowes. This is all about creating a better future for our customers, our employees, and our partners. For MapInfo, it will always be about Customer First. This is first among our core values and is a priority shared by Pitney Bowes.

Even though we've just made the announcement, the merger is expected to close in the next two months. Upon closing, it is anticipated that MapInfo will operate as a wholly owned subsidiary of Pitney Bowes within its software segment. As a combined entity, we will be delivering better products and services.

In the interim, this merger will not affect your relationship with MapInfo or MapInfo's Business Partners. Our current offerings will continue to be supported. Your MapInfo and Partner contacts will all remain the same. They will be contacting you with new information as available.

We sincerely appreciate your business. I will continue to lead MapInfo and will personally ensure our unwavering commitment to your continued success.

Kind regards,



Mark Cattini
President and Chief Executive Officer

Some commentry on this letter. 

- I received the e-mail on Monday, 19/3. The deal was announced last Thursday, 15/3. I know these things are complex, but we suspected management was pretty out of the loop and maybe didn't get a heads up to get this out earlier?

- The deal is referred to as a "merger" not an acquisition. Business people tell me that's normal.

- The e-mail confirms the customer focus: "For MapInfo, it will always be about Customer First." That didn't come up with such force in our conversations with Pitney Bowes and MapInfo execs, especially when I asked about support/plans for non-business users, like those in government.

- And, it's business as usual. Business people tell me that's what they all say, at least at first. Then there's change!

From MapInfo's perspective, Hickey said that the company had been approached by as many as seven firms to acquire them. It was the fiduciary responsibility of the board of directors to take the offers to the shareholders. At the 50% premium over the existing stock price, Pitney Bowes "showed MI the money" and it was an offer that was hard to refuse. As a stockholder until yesterday, I would have been furious if they had turned it down. But MapInfo was also feeling some of the pressures of Wall Street to constantly show progressively positive returns and was also somewhat contrained by the accounting procedures forced upon public companies by Sarbanes-Oxley. This acquisition would now provide them with some breathing room to pursue other opportunities that they might have felt was not prudent otherwise.

From Pitney Bowes' (PBI) perspective, it brings to them a company that provides a deeper reach into the business solutions value chain that they did not have previously. PBI is in the business of customer communciations management so the MapInfo acquisition takes them more into the realm of target marketing. If you weed through the marketing lingo, this provides a more complete market intelligence package for a client looking for direct marketing campaign management.

My question is whether this is too much of a stretch for PBI. Indeed it is complimentary but it seems like a large step for a company that is really into mailstream management. Walden said G1 had not tried to offer a visualization platform like MapInfo's and perhaps thought customers might have benefited if they had. The move by Pitney Bowes to acquire G1's address validation and geocoding solutions in 2004 did not seem like a stretch. The MapInfo acquisition, PBI's largest ever, seems like a leap further down the value chain. But only time will tell and the details of how the management teams will meld is yet to be determined. From Hickey's point of view, the MapInfo management team was along for the ride while the shareholders and BOD determined how best to evaluate the opporunities presented to them. It may be a wild ride or smooth sailing...we'll keep watching.

Pitney Bowes Pays Premium for MapInfo

Pitney Bowes (PBI) has made a play for the location intelligence market today by buying MapInfo offering over $20 per share or 50% over yesterday's close of $13.21. It's in the business of location technology already as it owns Group 1 Software (acquired in 2004), maker of geocoding and address validation software. I think Pitney Bowes sees the oncoming wave of location-based business intelligence (BI). They've got the important piece that companies look for initially which is georeferencing a corporate database; now they are angling for more of the analytical space. It's a good move but I think they'll have name recognition problems if they dismiss the MapInfo brand. They didn't do it with Group 1 so I suspect MapInfo will still be around in some form. Although I would predict that those units would merge.

By way of history, it was Group 1 that acquired Sagent, which had acquired QMS, all of which had solutions for data QA and geocoding. Last year, Microsoft had selected Group 1 for its geocoding engine to support some of its online mapping systems. So, I suspect that PBI can now offer and promote more "location intelligent" (formerly business geographics) solutions and go after other enterprise opportunities. PBI has a market cap of $10B and could try to secure a piece of the BI market.

MapInfo now has a big brother with some cash. Will Pitney Bowes try to acquire a BI company like Information Builders or Business Objects? I think that would be a very significant move and if they choose correctly could develop a niche market for a piece of the enterprise market that wants to spatially enable its customer database quickly.

Pitney Bowes to Acquire MapInfo for for $408 million

Ok, well didn't see that coming! (press release) There'd been speculation for some time that Oracle or Intergraph or Microsoft might acquire the company, but I confess I never hear a rumor about Pitney Bowes. that goes to show, perhaps that I think of MapInfo as a GIS company and in fact it's more a "location intelligence" company to use its favorite term, or a "business to business" company to use my term.

Pitney Bowes is based in Stamford, Ct. (I think we had a NEARC meeting there once) and is described variously as the "the largest maker of mail-handling machines" and a "mail and document management services" company. So, it's basically another B2B company in what it calls the "mailstream" business. PBI (per its website) helps "companies manage their flow of mail, documents and packages."

As an "outsider" to location intelligence and business geographics I don't see a clear connection. I do see a link in geocoding and getting addresses correct, things related to mailing efficiently, but I don't see a direct link. What I do see is a link like General Electric wanted when buying Smallworld, one that allows selling more products and services into an existing client base: "We already sell them the hardware of energy delivery, now we can sell them the IT side of it, too." At PBI that might read this way: "We already enable their mail communications, now we can sell them products and services for location intelligence."

How did GE do in that venture? It's hard to say as GE Energy and the GIS portion is a tiny part of a very large company. I can say that Smallworld certainly left the GIS radarscreen for a while, though it popped up again based on an announcement at GITA of new solutions built directly on Oracle Spatial.

What of PBI and MapInfo? Well, the small part of a big company is still true: PBI has 34,000 "mailstream professionals" to MapInfo's less than 1000. Like Smallworld in the past, much of MapInfo's revenue comes from consulting (Thompson and Associates type work). I think it'll be PBI's ability to manage that side of the house is what will make or break the deal.

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