As I reported a few weeks ago, Ribbit has indeed been sold to BT, and as many thought, it wasn’t for 55 million. It was for $105 million… which makes complete sense to me.  I know I’m going to cross over into the report I’m writing again if I’m not careful, but here’s the math that makes that work:

• British Telecom has relationships with over several thousand large companies in Britain: British Air, BBC, HSBC, Barclays, Royal Dutch Shell, BP, RBS…  you get the picture.  Each of these companies will one day demand (if not already) that their telecom provider offer APIs so that they can integrate their business process with the communications infrastructure.  Thus, the BT21C APIs are born.
• As a round number, assume that each large company has between twenty and forty large applications that require integration and management. We can count six areas that all have right off the bat : CRM, ERP, HR, logistics, inventory management, IT automation. No stretch to imagine that each area has several applications in it, or different divisions have different needs, etc.
• Again, as a round number, business efficiencies of 20% are commonly seen in CEBP applications, providing ample reason to integrate communications systems with enterprise applications.
• So, from simple multiplication, we have several thousand companies with 20 to 40 applications each, giving us about 30,000 CEBP applications for BT’s large customer base alone.
• From a world-wide market perspective, just multiply that number times the number of large carriers.

So, what are the chances that there are 30,000 CEBP engineers in the world? Would you say about Zero? I would.  What happens when you have a tool that any web developer can use, like Flex or Flash? You’ve got a fair sight more than the 100 or so CEBP engineers that exist now.   By aquiring Ribbit, BT acknowledges that there’s a severe go-to-market issue with CEBP deployments: there aren’t enough engineers to do them.

Who’s next on the block?  Maybe that’s a good item for my report.