Altran’s Press Day: IP and New Capabilities

/ March 18, 2018/ Altran, Aricent, France, Investor Update, US

Altran recently hold a Press Day, and presented its new profile, before and after the planned acquisition of Aricent.

The Press Day was the occasion of demo-ing several innovations that Altran has developed for its clients, for instance Sparkle, a digital twin for an Airbus plant in Cadix, Spain, with the possibility using VR for going through the plant, mostly for training purpose. A good surprise was Altran also develops its own IP: it demo-ed Robot Mind control that made a robot go forward and backward, with one’s own thoughts as controls. Robot. And there was Vincent, an IP designed by Cambridge Consultants, for creating paintings automatically out of simple sketches created by humans. To create Vincent, Cambridge ingested into an AI several thousands of paintings, and the results are impressive: a few lines and the Vincent AI creates a painting, on a screen, within seconds. Impressive, and a bit scary.

Altran also presented the capabilities that Aricent will bring to the firm: solid presence in the US, quadrupling of its offshore and nearshore presence, bringing new strengths in telecom and semi-conductors, and also new capabilities. Among the new capabilities are software product development, systems engineering, and design. With Aricent, Altran enters in a big way the software product development market, an area it had entered in 2016 with Lohika with a delivery engine in Ukraine and Romania (and a total headcount of ~700). Aricent brings scale in this space, and Altran now has both a delivery engine in India and Ukraine to compete with the Indian vendors and EPAM/Luxoft. A compelling value proposition. Still, we would have loved more details, and in particular how the IP partnership works in detail. See our blog on the IP partnership of IBM with Aricent, and also HCL Tech, and Tech Mahindra.

A surprise was Altran’s emphasis on the product design capabilities brought by Frog/Aricent for both physical and digital products. With Frog, Altran believes it has a top three design house, along with Ideo (700 FTEs), and Accenture Interactive’s Fjord. It is unclear which of the three is the largest, but the point is that Altran now has gained overnight scale in product design. In this space, it well ahead of major competing pure-plays, even if GlobalLogic (with Method), and ÅF (with InUse and its infrastructure and building designers) are also present. Akka does some automotive design capabilities with the recent acquisition of Bertone. Alten, Bertrandt, Belcan, LTTS, Cyient, QuEST Global don’t as far as we can tell.

Of course, acquiring a company is much easier than making a success of an acquisition. And Altran has its share of challenges in front of it: integrating Aricent without distracting Altran, make an integrated group out of the many acquisitions in the US and in Europe, prove that strengthening its telecom presence is a good idea, and make offshoring work. But let’s not spoil the party: the acquisition of Aricent is an expensive one but is strategically-found, and Altran has the potential to become this undisputed leader it wants to be, even with the Indian competition, and Alten being very active. Best of luck.

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