Blog post

Rumors Have It

By Whit Andrews | October 17, 2008 | 4 Comments

Here are the rumors I heard in the past week about Who’s Gonna Buy Whom in the current global financial mess, in my specific market, and what i think. THESE ARE ALL RUMORS. I don’t have any inside information, and if I did, I couldn’t share it with the likes of my readers, frankly — Gartner has a standard clause in its contracts that says as much. That said:

Oracle Will Buy Autonomy? I think this rumor makes a lot of sense. Oracle would benefit from the kind of exceptional technological vision that Autonomy offers, and the charisma Autonomy CEO Mike Lynch brings would elevate Oracle substantially in a variety of fields. I can’t help thinking that the money crisis will make Autonomy’s software attractive to a lot of irritable boards, and that raises a real possibility for a nicely accretive buyout. Oracle’s and Autonomy’s cultures would match in many ways, as both vendors seek opportunity vigorously. Autonomy would be a really expensive acquisition, but Oracle doesn’t seem to mind that sort of thing. That said, both companies regular indicate they have no idea where this rumor comes from, even though it keeps coming back.

Autonomy Will Buy Endeca? Endeca has a magnificant customer base, which is what Autonomy generally looks for in a purchase, and that resonates outside Autonomy’s core business of unstructured data. Endeca has peculiar strengths in areas like e-procurement and structured search, which makes it a very interesting target for Autonomy here. On the other hand, I’m not sure the cultures would match as well, and the Endeca technology is solid and even superior, which means Autonomy would be spending a lot of strong technology when it has justifiable faith in its own.

IBM Will Buy Endeca? IBM has been wrestling with a search strategy for some time — and quite effectively, as its position in the Magic Quadrant indicates. Buying Endeca would bring into the fold a key visionary, but IBM bought erstwhile Endeca competitor iPhrase years ago and never fully realized that value. Endeca would be a great purchase, in other words — but might not make sense for political or other reasons.

Other, less interesting rumors circulated in the financial challenges last week while we were all at Symposium, discussing rumors the way people do, wondering which will prove true and which won’t, which would have turned true if things had been just a little different — and which will never happen. One investor came to me and spent quite a while talking about what prices he might be able to command for a given small vendor; another spent some time asking what Big Vendors could carve out their search and flog it to the existing mid-sized players.

These are only rumors, it bears repeating. Clients often call me about rumors like these and ask what i think. Pretending rumors like these don’t exist is worse, I think, than pulling them out in the open and discussing them. Anything can happen, but some things are more likely than others.

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4 Comments

  • roman gregor says:

    what about Sap buying Teradata. I seem to be getting a lot of calls on that. Most recently from a investment house … Did this one come up at the symposium ?

  • Whit Andrews says:

    I wouldn’t hear much about that — that’s the kind of thing that would make a good inquiry with the RDBMS team. Sorry not to be of much help.

  • John Lesh says:

    I don’t think anyone will acquire Autonomy, the P/E is too high and they’re too expensive, although it looks more likely Autonomy buying Endeca. Well, we’ll see, anything can happen.

    What about IBM buying Autonomy?

  • Whit Andrews says:

    Like you say — a pricey buy. And IBM just released e-discovery software of its own. Anything, indeed, can happen.