Vivisimo Value

April 30, 2012

Okay, azure chip consultants, the goslings and I have completed our review of the Vivisimo information in our Overflight system. We have reviewed the data available to us for the IBM buy outs of Cognos, i2, and SPSS. We have reached some hypothetical conclusions. Keep in mind that this is our own Kentucky analysis, fueled by mine run off and our Overflight data.

First, we think the IBM Vivisimo deal was a pretty good move for IBM. More to the point, IBM gets some technology and some employees. But the amount of dough IBM coughed up for Vivisimo was probably not much above $25 million and may be as low as $18 to $19 million. The reason is that Vivisimo just did not have market traction, a fact I documented in The New Landscape of Enterprise Search, which is now out of print. (We are still doing briefings, so if you are interested, write us at seaky2000 at yahoo dot com.

Second, the Vivisimo technology was not up to the rigors of the enterprise. In fact, we believe that the “big data” public relations spin was one of those deals which reach back through college fraternities and obligations which the Facebook generation do not understand. We hypothesize that this was a “white knight” deal, not a crafty business move to thwart Oracle or SAP, among others in the enterprise game.

Third, the value of the recent spate of acquisitions says more about what a company will pay for customers, consulting opportunities, and ways to extend the life of an existing product line. Lexmark printers anyone? Vivisimo is more of a utility; it is not an Autonomy or an Endeca type of outfit.

How wrong are we? Well, since this is a free blog, you need to do your own calculation. We think our hypothesis is pretty strong and we think the value of the deal is in the range we calculated. Azure chip outfits will want to avoid search. The money days may be over. Hello, big data and analytics. Goodbye, gentle search.

Stephen E Arnold, May 1, 2012

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