About ten days ago, Corel announced that they are buying InterVideo in an all-cash deal. As InterVideo had recently purchased Ulead, those products will also be part of the deal.
At first glance, the price paid ($196M) seemed really high compared to Corel’s current company value. But if you read a little bit closer, you’ll see that InterVideo has cash and cash reserves of $105M so the price doesn’t seem nearly as high.
For the most part, the products Corel is purchasing are a good fit into Corel’s portfolio of graphics and imaging products. Now they have a variety of tools for video editing and playback that they didn’t have before. Buried a little deeper in the portfolio is Ulead’s PhotoImpact. Now Corel has five different image editing products. Sure, Picture Publisher has more or less disappeared. But the other three (Corel PHOTO-PAINT, Corel Paint Shop Pro and Corel Painter) are still alive and there is nothing on the horizon that indicates they will merge together. Nor do they even work together in areas as simple as file sharing.
My concern is that this will further take Corel’s eye off of their flagship product, CorelDRAW. Now they have more products to promote and offices in yet another location. If things are done right, it could be a huge bonus for CorelDRAW users. In a perfect scenario, CorelDRAW and Corel PHOTO-PAINT could be integrated into a video editing suite. I just can’t imagine that will happen based on Corel’s past purchases.
I also still scratch my head and wonder why Corel won’t commit just a few million dollars to developing Corel Ventura, a product they already own that has a userbase begging for an update. It is a product that still outclasses similar products even though it hasn’t been developed in five years. Sadly management probably won’t realize the great opportunity they have with Ventura until long after it has passed.