Oracle buys Endeca, but what does this mean for the unstructured data market?

By Nicola Brittain
19 Oct 2011 View Comments
Two men shake hands

Oracle bought unstructured data company Endeca yesterday – perhaps the first acknowledgement that managing unstructured data is a market it should tap into from a company that normally deals in traditional structured databases.

The value of the deal has not been disclosed and it is expected to be signed off before the end of 2011.

Further reading

Endeca provides products, based on its core technology, the MDEX engine, that allow companies to analyse unstructured data and retrieve business intelligence.

There are two products within the Endeca portfolio. The first, Endeca Infront, is a customer experience management platform that is well developed within the e-commerce space.

The second, Endeca Latitude, is a technology platform enabling the production of business intelligence reports from unstructured and structured information sources.

The platform will process, store, manage, search, and analyse both structured and unstructured information.

Oracle does have its own Secure Enterprise Search (SES) product, which is able to scout unstructured data and has been designed to control what people see, but it is not referenceable.

However, Ovum analyst Mike Davis said that the product has always been overpriced and is now often bundled either into big technology buys, or into other products such as the Cbord or JD Edwards systems.

"It seems that Oracle has now bitten the bullet and gained itself some high-end capabilities, and a referenceable customer base for enterprise search, rather than continuing to develop SES," said Davis.

"And Endeca was the last of the big independent enterprise search engines, as Autonomy and Fast have already been swallowed by HP and Microsoft, respectively."

The deal has prompted a big PR push from HP-owned Autonomy. Derek Brown, director of corporate development and strategy for Autonomy, told Computing that he thinks Endeca has a limited scope by comparison with Autonomy's own. Endeca specialises in just BI and e-commerce, while Autonomy deals with BI, e-commerce, compliance, governance and e-discovery, amongst other things, said Brown.

"Endeca's turnover last year was £100m, while Autonomy's turnover was £1bn," he added.

Autonomy was acquired by HP earlier this month, following an announcement in August, for a whopping $10bn (£6.32bn).

Brown also said that Endeca does not have enough of the "connectors or filters" necessary to retrieve information from company repositories, and so has to hire them from other companies.

These repositories include those able to search email (Outlook or Lotus Notes), CMS systems and other legacy databases.

Autonomy has approximately 400 filters after purchasing Verity in 2005.

However, Davis explained that Oracle does have a considerable number of these connectors or filters, as a result of its acquisition of Stellent in 2006,.

"Interestingly, Oracle and Autonomy between them have almost all the filters required to pull unstructured data from company repositories," he said.

It was widely rumoured that Oracle had looked into buying Autonomy prior to HP's acquisition of the company, but decided it was too expensive.

Oracle recently launched an attack on Autonomy chief executive Mike Lynch, accusing him of lying when he denied that he tried to sell the company to Oracle before it was acquired by HP.

Davis added that such an acquisition might have been disallowed by the anti-trust regulators if it had gone ahead. The companies own almost all the necessary filters for unstructured data search between them.

Either way, it looks as though the unstructured data market is likely to warm up over the coming months.

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