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January 25, 2006updated 19 Aug 2016 10:10am

Why are Autonomy and Fast at each other’s throats?

If you thought that hostilities in the enterprise search and information management sector might have died down after UK-based Autonomy bought its bitter rival Verity, you'd be dead wrong. It's just that Autonomy has a new fierce rival: the

By Jason Stamper Blog

If you thought that hostilities in the enterprise search and information management sector might have died down after UK-based Autonomy bought its bitter rival Verity, you’d be dead wrong. It’s just that Autonomy has a new fierce rival: the Norwegian firm Fast Search and Transfer (Fast). Autonomy says Fast is dishonest, has accounting questions, and exaggerates its customer wins. Fast says, well, pretty much the opposite.

I happen to have just met the CEOs of both Autonomy and Fast, and it was interesting to compare their attitudes to this latest open warfare. As far as Autonomy’s CEO Mike Lynch is concerned, Fast’s competitive tactics have gone “well beyond the acceptable”.

Lynch told me Fast’s claims about the number of times it beats Autonomy in competitive situations, and its figures on how many customers have switched from Autonomy to Fast, are, “simply not true”.

Fast’s president, Ali Riaz, told CBR in November that 25% of Fast’s growth in the past 12 months had been from companies switching over from Autonomy and Verity (recently acquired by Autonomy) and that 30% of its pipeline are customers looking to switch search technology providers.

Autonomy’s Lynch hit back, saying, “We have a 90% win rate against them [Fast]. Yet every time they win a customer that has anything to do with Autonomy, they put out a release saying they have won an Autonomy customer. They said they had replaced us at Vodafone and Hutchison, but in both cases they had chosen Fast in only a small subsidiary, while we have remained the standard at both companies.”

Next I met Fast’s co-founder and CEO, John Lervik. He stood by his company’s claims, and insisted: “We have not lost a single customer to Autonomy.” He also refuted Lynch’s assertion that Autonomy has a 90% win rate in competitive situations against Fast. “I don’t understand how [Lynch] comes to that figure,” he told me.

Lynch dismissed those arguments too, telling me Lervik’s claim that Fast has never lost a customer to Autonomy is “simply not true”.

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They have always been rivals, but the aggression between the two companies has become particularly intense since Autonomy announced it was to acquire Verity for about $300m ($500m, but Verity had about $200m cash in the bank), thereby turning into the gorilla in the space, with 16,000 customers and a $200m annualised revenue run rate.

Perhaps it was just that Fast now has a single vendor in its sights whereas before it had two; perhaps it is the fact that Autonomy has turned its own attentions from competing with Verity to attacking Fast.

Who started it? Good question. But in November Fast issued a press release offering, “Safe passage to Verity customers and partners who are facing uncertainty arising from the acquisition of Verity by Autonomy.” It was a strongly worded release and it went for the throat, hoping to stir up fear, uncertainty and doubt (FUD) in Verity’s customer base.

Lynch said he felt Fast’s tactics went “beyond normal competitive banter” and were “very, very aggressive”. Autonomy duly responded with more aggressive tactics of its own, helping to highlight recent reports in the Norwegian press that have questioned the legality of Fast’s accounting practices, and also putting out a release offering a “secure transition route for Fast customers and partners who may be concerned about Fast’s publicly-known accounting questions.”

Fast’s Lervik though has denied any financial chicanery, telling me: “Actually we comply with both Generally Accepted Accounting Principles and International Financial Reporting Standards. There’s nothing illegal about them.” More on that story here.

Unlike Autonomy’s Lynch, Lervik told me he considers the recent escalation of claims and counter-claims between the two fierce rivals to be “healthy competition”. One thing seems clear though. With Autonomy the gorilla after its Verity buy, but Fast coming up swiftly on the outside, there is unlikely to be a let-up in the hostilities any time soon.

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