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January 26, 2009

Interwoven acquisition ‘won’t unsettle’ Autonomy OEMs: CEO

Does Autonomy's latest buy create conflict of interest?

By Jason Stamper

Autonomy’s CEO Dr Mike Lynch has insisted that his firm’s $775m acquisition of Interwoven will not present a problem for the numerous rival content management firms that are currently Autonomy OEMs.

British search and information management firm Autonomy announced the acquisition of US-based content management company Interwoven on Thursday last week (January 22). Autonomy said the combination of its own ‘Meaning Based Computing’ technology with Interwoven’s content management platform will be a powerful combination.

 

Read CBR’s initial coverage of Autonomy’s Interwoven acquisition, and why Lynch said it makes sense, at http://tinyurl.com/bhwyut.

 

But one fly in the ointment could be the effect on Autonomy’s current OEM deals. Numerous large technology vendors OEM its technology for use in their own applications.

Autonomy has rarely competed with them in their own particular areas of specialty – until now, that is. Autonomy’s acquisition of Interwoven takes it into direct content management competition with existing OEMs including Vignette, Open Text, EMC, IBM, Adobe, MediaSurface, Tridion, Red Dot, Oracle Stellent, Hyperwave, Objective and more.

But speaking exclusively to CBR, Autonomy’s Lynch insisted that the interwoven acquisition will not jeopardise its OEM relationships – which account for an increasingly sizable percentage of its revenue.

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“It’s fairly standard for us to have OEM relationships with companies that compete in certain other areas,” Lynch said. “When we bought [information risk management firm] Zantaz that took us into competition with some of our OEMs, and it didn’t present a problem.”

 “We’ve got around 400 OEMs and we have only ever had one who threw their toys out of the pram over this issue, and they are no longer in business,” he said.

“We run the two businesses separately, and so while one side might do something that competes with OEMs, the OEMs are dealing with our engineering side, and they just want the best technology available,” Lynch said. “The other factor is that it is very hard to buy what we do anywhere else, so most OEMs are fairly pragmatic about it.”

When CBR spoke to Lynch last week, he said he had not had any discussions with any OEMs about the acquisition of Interwoven; the deal had only just been announced.

 

CBR recently wrote a profile of Autonomy featuring an exclusive interview with Mike Lynch – read it at http://tinyurl.com/8gh9qk.

Read our analysis of Autonomy’s stellar fourth quarter results, announced the day before the Interwoven acquisition, at http://tinyurl.com/cy7bpw.

 

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