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Posted by Brian Hill on January 26, 2009
Autonomy’s recent announcement that it plans to acquire Interwoven will strengthen its traction in the broader eDiscovery landscape. With the purchase, Autonomy picks up a range of assets, but a key component of the $775 million purchase focuses on new opportunities to mitigate legal and regulatory risk and capitalize on the surging eDiscovery market.
Along with other markets, M&A activities in this segment slowed in Q4 2008, but vendors continued to announce a steady stream of partnerships (e.g., Open Text - Recommind and CaseCentral - CommVault) and significant internally developed offerings. Selected acquisitions in this market include:
Autonomy’s acquisition supports a growing consolidation trend in the eDiscovery vendor community. Today no single vendor provides “end-to-end” or fully comprehensive enterprise eDiscovery support. Instead information and knowledge management (I&KM) professionals must grapple with a highly fragmented market with a large number of vendors who provide support for some subset of the steps outlined in the electronic discovery reference model (EDRM).
This fragmentation causes headaches, but during 2009 these burdens will decrease as vendors digest additional acquisitions, put more emphasis on partnerships, expand their portfolios, and address interoperability through standards and industry working groups. New vendor entrants to the eDiscovery market, however, will slow this consolidation. Overall, Forrester expects that M&A activity in this segment will increase during 2009 as vendors with deep pockets acquire firms with demonstrated eDiscovery strengths in offerings or human capital. As this consolidation continues, enterprises should cautiously monitor engagements with point providers.
My initial take on Autonomy’s acquisition will ultimately be positive for enterprises focused on eDiscovery. Here’s why:
In the near- and mid-term, Autonomy will need to focus on product delivery and plans and enterprises should closely monitor execution. Here’s why:
Autonomy will continue to be a major force in the eDiscovery market. Acquiring Interwoven will bolster its prospects for delivering effective solutions provided that Autonomy can successfully integrate product portfolio, overcome corporate cultural differences, and align sales channels. Current customers and enterprises considering prospective eDiscovery solutions stand to benefit but should ensure that they understand how the pieces fit together, document commitments, and continue to review Autonomy’s execution.
What do you think the acquisition means for the eDiscovery market? Please write me at firstname.lastname@example.org.
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