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Ancestry Acquisition

Article Date: 
15 October, 2010 - 06:00

Ancestry.com is the leading commercial genealogy company worldwide. With more than 6 billion records including the full set of census records for both the United States and the United Kingdom as well as one of the best sets of immigration records worldwide they set the standard by which all other companies are measured.
Ancestry was one of the first in the field of online companies and began publishing digital records before it was accepted. They also have often led the way with technology solutions.
Not quite a year ago Ancestry went public. Over the past years they have acquired a few companies. At times this was to gain assets that were valuable to them. At other times it was a defensive acquisition aimed at defending their market share. They are much larger than their nearest competition and they generate good cash flow. This allows them to make acquisitions when they see the need.
A few months ago Ancestry acquired a small company in Europe called Genline. I have written about this previously. Genline had an excellent collection of Swedish records. They had carved out a niche for themselves in a small market and were seeing their business come under threat from SVAR, the national archive of Sweden. It would have been difficult for Genline to survive in the long run as a separate company, but as a part of the Ancestry family the records provide added value to subscribers. Ancestry has not announced what they will do, but it seems likely that they will not retain the Genline brand, but will rather fold it into Ancestry.com.
In the last few weeks Ancestry announced the acquisition of Footnote.com. This acquisition seems more defensive in nature to me. Footnote has been steadily growing a collection of records that were as historically focused as they were genealogically focused. Footnote had established a very strong relationship with the National Archives and Record Administration (NARA), the entity in the US government that manages records. They were increasingly involved in helping NARA to publish their records digitally.
Footnote was no threat to Ancestry from a size perspective, but their relationships with Archives and some of their technology must have given Ancestry pause. Their decision to acquire Footnote seems to me to be harmful to the industry, rather than helpful, in the long run. Ancestry has not announced what they will do with Footnote, but unlike Genline who had a small subscriber base that was under threat, the Footnote subscriber base seemed strong and growing. There would appear to be little value in the short run to fold Footnote into Ancestry. I expect Ancestry will continue to run Footnote as a separate company for at least a little while.
I hope that other genealogical companies can manage to sprout and grow without being acquired by Ancestry. Competition tends to foster innovation and efficiency. Ancestry seems to steadily eliminate competitive threats to itself. While this is understandable from their perspective it does not help the market to grow. It will be interesting to watch the space over the coming years and see if any organizations can grow to provide good competition in the market space that will help keep prices at an affordable level and help the space to innovate and grow. I hope that we will see this and that some other companies can manage to find their own space and provide great value to their customers. All genealogists will benefit if this can come to pass.