Attivio and Autonomy – what does the future hold?
thereforIn the period from 2007 to 2013 a number of small enterprise search software companies were acquired by some of the leading global IT players. The process was started off by Microsoft (with FAST Search) and then IBM (Vivisimo), Oracle (Endeca), Dassault (Exalead) Lexmark (Isys) and HP (Autonomy). Then in 2016 OpenText acquired Recommind. The HP/Autonomy acquisition then unraveled quite dramatically, with Autonomy being sold to Micro Focus Ltd. a UK company which has specialized in acquiring software assets that have become surplus to requirements in their original corporate setting.
Over the last couple of months there have been interesting developments. In August Lucidworks benefited from a $100 million investment and then lost Grant Ingersoll (to Wikimedia) and Stefan Olafsson (ex Twigkit) in quick succession. Then Algolia, a hosted search service, picked up a $110 million investment from a group of investors which included the venture arm of Salesforce.
Then last week there were further very interesting (and frankly somewhat strange) developments. First came an announcement from ServiceNow that it was acquiring the cognitive search intellectual property (IP) of Attivio along with some of the key software engineers. This did not come as a complete surprise because there was a very strange blog post from Attivio on 10 September written by Stephen Decker, who works for Shaw Data Security, a partner firm of ServiceNow. What is strange about this Attivio blog post is not only that it was not written by Attivio but makes no mention of Attivio! My guess would be that the attraction of Attivio would be its federated search platform. At this point it might be worth noting that Salesforce and ServiceNow are competitors, so perhaps the Salesforce investment in Algolia is not entirely a benign financial investment. Just a thought you understand!
This asset acquisition inevitably raises the issue about what will now happen at Attivio. According to the blog post on the Attivio site “Attivio will continue to support its existing customers and power their search experiences across employee experience, customer support, and risk avoidance. And we’ll keep you updated in this space about what we have planned next for the future of search.”
Two questions. How will Attivio continue to support customers when its IP is inside ServiceNow, and why was there not a more detailed and positive commitment to customers which addressed this IP issue? It all looks like a rather high-speed IP grab in the greater interests of ServiceNow customers.
Let me now shift to Autonomy IDOL, which has dragged down Micro Focus to the point that it’s shares are now trading at around 50% of the 2019 peak. Micro Focus announced that it had asked Goldman Sachs to review its business operations. Then last week there was a news story from Bloomberg that OpenText was considering acquiring Micro Focus. A denial quickly followed from OpenText and that denial was noted by Microfocus. I can see no reason why OpenText would want to buy Micro Focus but perhaps it is sizing up making an offer for Autonomy IDOL. The denial would still be true.
Making money from selling enterprise search software is challenging. Microsoft has a dominant position (a search manager has to argue with IT as to why they want something better than Microsoft Search), the sales cycle is very long even when the budget holder is identified, and the implementation challenges are very significant. Search software companies have to rely on integration partners, especially for global implementation projects, and that makes the Gartner Magic Quadrant evaluation of ‘ability to execute’ less than helpful. But that’s another story. I wonder if Gartner and Forrester are now going to update their recent surveys of the industry?
Correction on 28 October. I have been informed by Attivio that Stephen Decker now works for Attivio. When I checked out Stephen’s Twitter profile today it still referred to him being at Shaw. The inference I made about a third-party blog post is therefore not valid. Attivio feels that since the blog was on the Attivio site it was clearly referring to Attivio software.