HP and Autonomy: Is change coming in enterprise IDOL?

The company that HP purchased had a remarkable number of facets. Michael Lynch and his core management team had the expertise to keep Autonomy number one in enterprise search at the same time the company expanded its revenues from its acquisitions. Unlike HP, Autonomy flourished by combining entrepreneurial methods with the tried-and-true MBA approach to sales and finance.

Sustaining the KM ecosystem

I believe that HP will be able to market the Optimost Clickstream Analytics products and services. I have no idea what the revenue and margins will be. Like others, I will have to wait until HP releases more data in its next financial report. I think that HP will face some tough questions from Autonomy's customers who use the system for search, knowledge management, fraud detection, video search and e-discovery. I do not think that HP will have the appetite for investing in the research and development to keep Autonomy's products in step with customer requirements. Autonomy was a mosaic of solutions, and I think HP will not be able to sustain what I call Autonomy's "knowledge management ecosystem." In short, Autonomy's pre-acquisition revenue could erode quickly, which means that the new Autonomy products and services have to perform more quickly and more effectively.

The $10 billion price tag for Autonomy ups the ante for HP. Existing Autonomy licensees will be besieged by vendors offering competitive products and services. The wide availability of open source data management systems, open source analytics and open source search might be one alternative. Traditional HP rivals like IBM, Microsoft, and Oracle will be pursuing Autonomy's customers as well. HP, therefore, has given itself a big job in search and content processing. HP will have to move quickly, generate high-margin sales and prevent defections from Autonomy's customer ranks.

Whitman told the Wall Street Journal: "Most turnarounds in American industry are anywhere between four and five years. And we're at the beginning the journey, not the end of the journey."

Will HP have the luxury of time in the knowledge management market?


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