Autonomy loses its autonomy – will it be HP’s idol?

by | Aug 18, 2011 | Intranets, Search

I’ve been waiting for some time to unleash this blog title! The ink now seems (late on Thursday night!) to be dry on the acquisition of Autonomy by HP for around $10 billion, of which founder Dr. Mike Lynch will get 8%. Microsoft buys FAST Search, Dassault buys Exalead, and Oracle buys inQuira. To be British for a moment, it’s great to see Mike Lynch get the benefit of the way he has driven Autonomy forward. (Mind you a few other people have made some money out of the deal as well without knowing anything about Bayesian statistics.) The company has a reputation for being arrogant but look at the numbers and it probably has a right to be. But now the last of the big ‘independent’ search vendors has gone from the scene, right in the middle of me writing a report on the enterprise search business for the European Commission. Add in Google’s purchase of Motorola Mobility and it’s been an interesting week.

For HP to pay the significant premium it has for Autonomy means that it sees a future in search applications. One of the strengths of Autonomy was its OEM business and that would fit well with HP getting more into services now that it has buried webOS and its PC business. Quite what IT Directors will make of it I’m not so sure. Autonomy had considerable brand strength, to put it mildly, using Tottenham Hotspur and the Mercedes Benz F1 team to promote its image.

HP has had some difficult years, and you almost wonder if the Autonomy deal was done to hide the news about webOS and the PC business, especially in the wake of the Google acquisition of Motorola Mobility. The smart move for HP would be to let the dust settle and allow Autonomy to do its own thing before trying to be too clever with feeding IDOL to the HP sales teams. Though HP Labs have been doing research on information retrieval for some time and have put a lot of effort into understanding the potential of cloud computing. There could be scope to sell off some of Autonomy’s many acquisitions. A number of privately-held search vendors are probably working out what their valuation would be. Nothing like the Autonomy price for sure! Certainly the deal indicates that the enterprise search market still has life in it, and that should be good news for other search companies, especially newcomers, looking to attract investment.

Martin White