LogMeIn, a provider of cloud-based IT access and management tools, has acquired cloud-based password manager service LastPass.
LastPass is popular with users for its focus on security, excellent customer service, and commitment to transparency. When it was recently targeted in an attack, the company garnered praise for the way it promptly responded and notified users exactly what was happening.
In enterprises, identity is increasingly decentralized as users turn to various cloud, Web, and mobile apps to do their jobs. With IT no longer controlling where corporate data is stored or who can use it, enterprises are turning to cloud-based identity and access tools. The LastPass purchase helps LogMeIn address this shift by building up its product line for helping businesses securely work with sensitive information.
"The LastPass acquisition is expected to play a key role in this effort, is highly complementary to LogMeIn's existing portfolio," and will bolster LogMeIn's position in the identity and access management market, the company said in a statement announcing the acquisition.
LogMeIn already has a number of management and collaboration products, including join.me, for remote meetings; cloud app discovery and management platform App Guru; LogMeIn Central, a remote device management solution; and Cubby Enterprise, for enterprise file syncing and sharing. LastPass will join LogMeIn's access portfolio, which includes LogMeIn Pro for providing secure remote desktop, file transfer, and remote printing capabilities for PCs and Macs.
This isn't LogMeIn's first foray into identity and access management. A little more than a year ago, the company spent $15 million to buy Meldium, another single-sign-on and password manager service. Like LastPass, Meldium offers a password manager as well as single-sign-on capabilities for popular cloud-based business apps, including Google Apps, Hubspot, Zendesk, Salesforce, Asana, Trello, and Jira.
For now, LastPass will be supported as a stand-alone product alongside Meldium, but long-term plans center around combining the two products into "a singular identity management offering" based on the LastPass service and brand.
"We will continue to build and improve LastPass for our free, Premium, and Enterprise customers," Joe Siegrist, CEO of LastPass, wrote on the blog post announcing the deal.
Many users were dismayed by the news, citing LogMeIn's past history of buying good products and hiking up prices. While LogMeIn dropped Meldium's free plan after the acquisition, the company has kept the various service tiers intact, so it seems likely that LastPass pricing will remain the same for the time being.
Several LastPass Enterprise users asked about the status of their account on the post and were assured by a LastPass spokesperson that there would be no changes to their service. Other users wondered about LogMeIn's reputation for erratic customer service, especially since LastPass was known for its prompt service. "Not jumping ship yet, but I'll be watching closely," one wrote in a comment.
The identity market is a growing one, and for a company like LogMeIn that's trying to carve out a bigger slice of the IT management pie, the deal makes a lot of sense. Study after study has shown that IT doesn't have clear visibility into what applications are being used and how user accounts are being provisioned. With the LastPass purchase and the earlier Meldium deal, LogMeIn is clearly focusing on an area organizations are currently struggling with.
Under the terms of the deal, LogMeIn will pay $110 million in cash for LastPass. LogMeIn also has $15 million in cash for contingent payments to equity holders and key employees if they meet certain milestone and retention targets over the next two years. The deal is expected to close in the coming weeks.