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  1. #1
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    Parallels buys Modernbill [merged]

    I can confirm that Modernbill has been bought out by Parallels (formerly swSoft), in what appears to be further 'strengthening' their control of the hosting software market. As well as owning most major control panels apart from cPanel, they're now diversifying into billing software...

    Thoughts?

    I understand that negotations have been underway for some time and that maybe this is why we haven't seen as much output from MB of late?

    Kudos to the MB team for getting this far though.
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  2. #2
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    Quote Originally Posted by mdrussell View Post
    I can confirm .... Thoughts? ...
    Can you confirm with some linkage?
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  3. #3
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    They seemingly haven't made it public yet. Hopefully they'll see this thread and confirm
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  4. #4
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    I also heard the same but they have not made this public.
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  5. #5
    For some reason, this isn't a surprise to me. Was expecting this for a while now.

    Not sure if this is a development, in the interested of the CP market.
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  6. #6
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    oh, I don't like this idea...
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  7. #7
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    interesting .... I can see how it will benefit them as HSPC and HSphere have built-in billing system. Perhaps they are trying to consolidate this.
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  8. #8
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    Quote Originally Posted by FHDave View Post
    interesting .... I can see how it will benefit them as HSPC and HSphere have built-in billing system. Perhaps they are trying to consolidate this.
    Plus HELM has a very basic system I think and PEM Billing Manager a *very* powerful system.
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  9. #9
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    There will be Parallels only in the hosting software market in next few years????

  10. #10
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    Quote Originally Posted by gate2vn View Post
    There will be Parallels only in the hosting software market in next few years????
    And therein lies the rub. I don't agree, solely because I am quite sure that all these purchases are just helping any future development work of currently unknown parties. The more Parallels buy, the easier it's going to be for a new group to come in and play the "Anti Parallels angle".

    What a strange purchase, though, I assume they didn't look at or care about the codebase before they signed on the dotted line.


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  11. #11
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    Quote Originally Posted by IHSL View Post
    What a strange purchase, though, I assume they didn't look at or care about the codebase before they signed on the dotted line.


    Simon
    They probably wanted the customer base rather than the code base. I think it makes a lot of sense for them - they have almost as many billing systems as control panels now so one more doesn't do them any harm.
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  12. #12
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    Quote Originally Posted by Layershift Andrew View Post
    They probably wanted the customer base rather than the code base. I think it makes a lot of sense for them - they have almost as many billing systems as control panels now so one more doesn't do them any harm.
    I disagree. I think this purchase will hurt them. The customer base is dwindling, that's an obvious one. If the codebase is going to be the same, then new management isn't going to stop the rot. Parallels' problem will be that they will inherit the terrible reputation that Modern Gigabyte has.


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  13. #13
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    like h-sphere and ensim I dont think they had to pay a high premium for MB...(this is a pure guess, I have no info to back that up)

  14. #14
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    Quote Originally Posted by IHSL View Post
    I disagree. I think this purchase will hurt them. The customer base is dwindling, that's an obvious one. If the codebase is going to be the same, then new management isn't going to stop the rot. Parallels' problem will be that they will inherit the terrible reputation that Modern Gigabyte has.

    Simon
    I'm not convinced. If they drop the product and force users to move to a new product they only need to be concerned about getting more from it than it costs them and they benefit. If they maintain the product they will need to improve it obviously but I'm not convinced there is much point in them developing 4 different billing systems when they could consolidate with signficiant cost savings so personally (based on my opinion only) I don't see them maintaining all of these separate products as they are.
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  15. #15
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    I suspect that, due to the recent (rapid) erosion of MB's customer base due to the unprecedented v5 disaster, MB was likely acquired at fire sale pricing.

    I can't see Parallels buying MB with the interest of recoding the product to bring it up to snuff. They just likely saw a bargain and grabbed it. If anything, just to eliminate yet one more prescence that (partially) competes with their HS product.

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  16. #16
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    Quote Originally Posted by vito View Post
    I can't see Parallels buying MB with the interest of recoding the product to bring it up to snuff. They just likely saw a bargain and grabbed it. If anything, just to eliminate yet one more prescence that (partially) competes with their HS product.
    If they do not improve MB, why need to buy it? Because customers are leaving, so Parallels doesn't need to buy MB, they still have chances to get MB's customers? It might be take more time, but MB is going to dead already...

  17. #17
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    Quote Originally Posted by gate2vn View Post
    If they do not improve MB, why need to buy it?
    In order to remove a competitor from their market at bargain prices.

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  18. #18
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    Hmmmmmm.

    This is a very interesting development to say the least.

    I would honestly expect for Parallels to pick a platform that is going to be their development platform, and then build converters to bring their acquisitions over to the main platform.

    So for illustrative sake, let's say they decide to keep PEM Billing Manager their primary product. Now they can write a bridge to bring MB4 and MB5 customers over.

    Parallels gets:
    • Customers they can legally contact;
    • Software upgrade dollars;
    • Warm & fuzzies by championing the MB users who have up 'til now felt fairly neglected by the MB team.
    Parallels' problem will be that they will inherit the terrible reputation that Modern Gigabyte has.
    Sorry, but one only needs to study takeovers and marketing to know that it simply doesn't work this way. Parallels is a completely different company, and they are coming at this from the position of strength.

    Modern Gigabyte's troubles will only be plastered upon Parallels if Parallels does nothing to fix the problems that MG created and perpetuated. E.g., if Parallels allows MB to sit in a state of disrepair, continues to not assist customers, does not build a bridge for MB users to utilize, etc. But if Parallels steps up to the plate and takes on a "we're here to help you" attitude, and really champions the customer here, they stand to make a lot of people very happy, and rake in a *fortune* in ongoing income.

    Without a doubt, the greatest asset that Parallels has acquired here is the customer base. Kudos to them for that!! Now let's keep our fingers crossed that they don't royally screw it up, for the sake of the people who are still on MB...



    As for me, this solidifies my decision to switch to WHMCS later this year.

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  19. #19
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    I agree with vito, firesale.

    That being said, I have an owned MB license since 2005 that hasn't missed a beat. Works perfect.
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  20. #20
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    I'm looking forward to this. Maybe Parallels can fix some of things that have lead Modernbill users to other software solutions.

  21. #21
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    It's worrisome for me. Parallels have a very monopolistic approach and I think that it is only a matter of time before regulatory bodies take action.
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  22. #22
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    Quote Originally Posted by mdrussell View Post
    regulatory bodies take action.
    Devils Advocate's. Which bodies?

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  23. #23
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    Quote Originally Posted by a2b2 View Post
    Devils Advocate's. Which bodies?

    Rus
    Not sure. Parallels is getting to a size where it may start to get noticed by the EU? Most of it's workforce are in Europe and look what the EU did to Microsoft for anti-competitive behaviour....
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  24. #24
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    Quote Originally Posted by vito View Post
    I suspect that, due to the recent (rapid) erosion of MB's customer base due to the unprecedented v5 disaster, MB was likely acquired at fire sale pricing.

    I can't see Parallels buying MB with the interest of recoding the product to bring it up to snuff. They just likely saw a bargain and grabbed it. If anything, just to eliminate yet one more prescence that (partially) competes with their HS product.

    Vito
    They should have just let MB die a horrible death, as it has been for about a year or so. I don't see MB as ever being a threat to them.

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  25. #25
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    I think there's value (although greatly diminished) in the Modernbill brand and MB can certainly be turned around with new management and renewed focus. The resources of a company like Parallels doesn't hurt either.

    I would have to agree MB was probably purchased at a bargain price unless Parallels failed to do their due diligence. I don't know, a corporate M&A guy or number cruncher at Parallels might not really have a good feel for the current market sentiment towards MB. ModernGigabyte is a private company but given the MB5 debacle, there must have been some kind indication in the numbers. MB's current state does make it an acquisition target so this isn't surprising, if true.

    I don't think Parallels would come under scrutiny by regulatory bodies simply because the general industry it operates in is so fractured. And a lot of larger companies run their own proprietary systems so despite Parallel's many acquisitions I doubt they're anywhere near a monopoly. I don't think they're even big enough to warrant regulatory attention - they're still small fish when it comes to antitrust concerns.

    One thing's for sure, they're clearly pursuing a strategy of growth through acquisition but thus far there doesn't seem to be any significant integration efforts. Operating all their new acquisitions independently seems like a big waste considering all the overlaps.

  26. #26
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    After the MB team focused on something else (DNZoom) and sold out, it was obvious this was going to happen - just didn't expect so soon!

    My one question in all this is - where does this leave billing software, like WHMCS & Clientexec, who have integrated support for Plesk, Ensim etc... - now to have Parallels competing directly against them? Previously there was a pretty big gap between the CE/WHMCS/MB etc... level and PEM/HSP - acquiring Modernbill moves them quite a bit further down into an area where they are competing for the same type of customer.

    Must also be slightly concerning for cPanel, which really benefitted from MB's automation with it, about the options for their customers shrinking. With so many control panels owned by Parallels now, they have little reason to support others like DirectAdmin and cPanel - leaving them out in a minority.

    Parallels seem to want to control the whole eco-system - which isn't exactly good for choice or competition. It will be interesting to see how things go this year.
    Last edited by tickedon; 03-10-2008 at 06:49 PM.
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  27. #27
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    I would say they have a very complete arsenal at hand, waiting to be integrated correctly to take over the hosting market. Good strategies and deep pockets. The main essence now lies in the integration of their purchases. If they do it right, they will really be a power to be reckon with.

    Quote Originally Posted by mdrussell View Post
    It's worrisome for me. Parallels have a very monopolistic approach and I think that it is only a matter of time before regulatory bodies take action.

  28. #28
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    Very interesting news indeed.

    Quote Originally Posted by mdrussell View Post
    I can confirm that Modernbill has been bought out by Parallels (formerly swSoft
    How did you "confirm" this?

  29. #29
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    Question

    There is a related thread with no official feedback from Modern Gigabyte here:
    http://forums.modernbill.com/showthr...892#post163892

  30. #30
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    On the comments of dwindling customers for modernbill none of us have any idea just how many people out there are still paying for licenses.

    You also need to keep in mind if Modernbill was for sale what would have happened if Parallels didn't buy them? I'm sure modernbill would have gone to a competitor. So they could have just been preventing that.
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  31. #31
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    No idea what their strategy is, buying all the companies that are going down the drain, h-sphere and now modernbill.

    The best thing they could've done was buy cPanel.

  32. #32
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    Quote Originally Posted by Funkadelic View Post
    No idea what their strategy is, buying all the companies that are going down the drain, h-sphere and now modernbill.

    The best thing they could've done was buy cPanel.
    Can only buy things that are for sale. I doubt cPanel is for sale
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  33. #33
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    Quote Originally Posted by TonyB View Post
    Can only buy things that are for sale. I doubt cPanel is for sale
    Everything is for sale.

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  34. #34
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    Maybe this will finally put modernbill out of it's misery.

    MB has been an absolute trainwreck from the beginings of V5. The app tried to be everything to everyone and had a terrible design from the code up. It simply didn't work... when it did work it screwed something up majorly. It was also terrible at anything other than shared hosting. It was downright awful for dedicated server billing, same for vps, same for anything else for that matter.

    I for one am glad to see it go. We were riding the v4 code train for years until we decided to write our own.

  35. #35
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    Another one!?!?!!

  36. #36
    Quote Originally Posted by Funkadelic View Post
    No idea what their strategy is, buying all the companies that are going down the drain, h-sphere and now modernbill.

    The best thing they could've done was buy cPanel.
    Was Helm going down the drain? Was Hsphere going down the drain? I dont think they were.
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  37. #37
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    Quote Originally Posted by Layershift Andrew View Post
    Plus HELM has a very basic system
    Eh? HELM 4 is probably the most advanced control panel on the market, hence why SWS bought it to take the modular code to integrate in to their next control panel.
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  38. #38
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    Did they buy all of MG or just MB?

  39. #39
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    Quote Originally Posted by amex View Post
    Very interesting news indeed.



    How did you "confirm" this?
    I have connections.
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  40. #40
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    Quote Originally Posted by AH-Tina View Post
    Everything is for sale.

    --Tina

    I inquired, actually. Their response was (and I quote) "Hell no"
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