Gen-i snaffles open-source firm

By RICHARD WOOD

IT services firm and systems integrator Gen-i has acquired "open-source" specialist Asterisk in a deal "in excess of $1 million" effective at the end the month.

Gen-i chief executive Garth Biggs said Auckland-based Asterisk was complementary to Gen-i and would continue to operate separately.

Asterisk, founded in 1999 by Igor Portugal and Chris Hegan, has 13 staff. "They have a customer base that we don't get to play in. We are very corporate heavy," said Biggs.

"They are, because of their cost structures and all sorts of things, able to drive down into smaller organisations."

Biggs said the two firms would work as "preferred partners" with each other but Gen-i did not want to kill the character of Asterisk by making it a department of Gen-i.

Hegan, Asterisk's chief executive, said all staff would be retained and he expected expansion and a presence in Wellington soon.

The firm's turnover was more than $1 million a year.

Open-source software is usually created by a "community" of programmers and provided free to use and modify on the condition that modifications and enhancements stay free too.

Asterisk provides IT services around open-source software and also has its own proprietary technology built on open source.

Biggs was unconcerned that open-source software was often seen as competitive with software giant Microsoft, with whom Gen-i has major dealings.

"Gen-i has been, and remains, product-agnostic. We are in the business of providing solutions to our customers. We do some open-source work at the moment. Our business, however, in those spaces is predominantly Microsoft. The market will define Gen-i's mix."

Biggs said Gen-i was seeing a "fair amount" of open-source deployment in infrastructure but not a lot in corporate applications.

He parried a suggestion the deal would help "legitimise" open source among New Zealand enterprises.

"Our customers are looking for solutions to their problems. Not many are looking for technologies for technology's sake. The idea we can drive customers into spaces is wishful thinking."

Hegan said the benefits to Asterisk of tapping into Gen-i's support and hosting infrastructures would be just what Asterisk needed for significant growth and payoff for Gen-i.

"We've spent three years building some significant intellectual property and a strong skills base.

"The things that have always held us back have been resources and an alliance like this that gives us credibility and durability."

Asterisk works in both software development and IT services. Biggs said the products were a significant component of the deal.

"They do have a revenue stream that is not just services related."

The firm's key internally developed products include a firewall/router and virtual private network system called Firefly, and a wireless Tablet PC solution.

Gen-i has 530 staff and turnover of more than $130 million.

Gen-i

Asterisk