MicroStragegy Inc. of Vienna plans to announce today the biggest deal in its 10-year history, in which software company Exchange Applications Inc. of Boston will pay MicroStrategy $65 million over a period of several years.
Exchange Applications specializes in systems that allow businesses to provide targeted direct marketing to their customers through e-mail and the Web. Under the deal, Exchange Applications will use "data-mining" software from MicroStrategy that helps businesses understand customers' buying patterns and preferences.
Exchange Applications has agreed to pay MicroStrategy an initial $30 million--two-thirds in stock and one-third in cash--for software licenses. The Boston company has an option to pay an additional $35 million to MicroStrategy over the next two to three years.
The two companies, which began a relationship in July 1999, will also create a joint software technology development team. The group, which will have about 35 people, will be based in Vienna. Exchange Applications also will join MicroStrategy's Strategy.com personal information network, through which it will sell MicroStrategy products and services.
The deal is the latest and largest in a string of agreements with other software companies--including NCR Corp. and Sybase Inc.--that signify MicroStrategy's ability to sell its wares not only to Fortune 500 businesses but to technology providers.
"We're seeing other software companies turning to MicroStrategy to help them build their products," said Sanju Bansal, chief operating officer of MicroStrategy. "We've been positioning ourselves as an e-business infrastructure company."