February 28, 2014
Google tends to play the innocent when people challenge the company for displaying results with lewd or inappropriate content. After all, Google simply catalogs Internet content and it can’t be held responsible for what others make, right? Wrong says “Google Loses Big In German Reputation Lawsuit” published in Search Engine Journal. Google has been sued before and played this defense. Logically it makes sense, but Google, as the article suggests, is partially responsible. Google’s algorithms rank pages in search results and the company has control over how the search engines works and how it delivers result.
The German case deals with a man who sued Google to remove detrimental photos from search results. He won suits to keep the photos from publication, yet they still appear on the Web. The judge ruled in the defendant’s favor. The article explains that this might set a precedent for Google, but:
“The target of this particular lawsuit suggests in an interview that lawsuits could help to solve this responsibility problem. In essence, he suggests that only people who have completed court cases should be able to remove their photos from Google. It seems smart, but again, I have some concerns. Lawsuits like this are very expensive, and not everyone has the money to hire a lawyer and take time away from work in order to appear in court. Similarly, court cases take months or years to resolve, and they generate a lot of web interest. As a result, people who file often find that their problems are magnified as the case moves forward, and they suddenly have much MORE data to remove.”
Hurdles aside, if someone has the time, money, and patience what is to keep them from suing Google. I can imagine an entire department at Google dedicated to controlling data removal from search results. Brin and Page are probably worrying at this moment.
February 19, 2014
The article titled Debt Maturities May Blow the Whistle on Altegrity on the Deal Pipeline explores the possibilities facing the Virginia based company. Altegrity is a private-equity owned background check company with the subsidiary US Investigations Services Inc. (USIS). The company was responsible for vetting both Edward Snowden and Aaron Alexis (the Washington Navy Yard shooter). The article explains,
“In a complaint filed on Jan. 22 in the U.S. District Court … the DOJ suggested penalties of $5,500 to $11,000 per violation of the firm’s quality review protocol for 665,000 cases, or about 40% of the cases Altegrity subsidiary, US Investigations Services Inc., has handled. On the low end of that spectrum, the damages could reach $3.7 billion. However, the fund manager noted that Altegrity could seek to settle the case for a much lower amount, curtailing…a lengthy litigation process.”
A USIS spokesperson defended the company with the statement that the allegations only refer to a small group of people over a short period of time. One looming factor mentioned by S&P analyst Brian Milligan are Altegrity’s 2015 debt maturities, which allow the company some wiggle room for negotiation. We should also note that is the company that has owned Kroll, the corporate security firm, since about 2007. Kroll has a search component acquired from Engenium in 2006.
Chelsea Kerwin, February 19, 2014
February 10, 2014
I read “Fastgründer John Markus Lervik dømt til fengsel.” Assuming the story is accurate, Dr. John Lervik, the founder of Fast Search & Transfer, will serve at least one year in prison. The issue is related to the financial reporting of Fast Search & Transfer.
In 2008, Microsoft purchased the company for about $1 billion, a deal compared to the price Hewlett Packard paid for Autonomy and about what Oracle paid for Endeca. Mr. Lervik will pay to pay legal fees. He will take appropriate legal steps to overturn the decision.
Enterprise search is a tough nut to crack technically and financially. The monetary challenges stem from the brutal costs of marketing and customer support. But these are at least as expensive as the cost of dealing adequately with technical challenges of enterprise search. For example:
- The time required to make a system deliver what the marketers assure customers are “ready to deploy” functions. Most large scale search solutions are not products. These are complex systems. Because each customer has specific requirements, the marketers do not understand that what they sold may take time to create, test, and deliver. Time is money. With an open ended problem, the cost is staggering.
- The problem of responding to crashes. When an enterprise search system flips over and dies, the cause may be the vendor, the reseller, or the client. Unfortunately the vendor takes the heat because many tech centric managers feel the “buck stops here.” Responding when a client is crazy mad is expensive. Failing to address the client’s need may delay payments or trigger legal action. Expensive stuff.
- The need to invest to keep pace with the information environment. Most of the mainstream search systems, including Fast Search and other older systems, focused on text. Handling different file types and different content types is an expensive operation for some vendors. The choice is stark: Spend and develop the components in house, spend money for third party solutions and then spend more to integrate those solutions into the core system, buy a company that has the people and the software needed, or ignore the client. There may be other options, but these four have big price tags. The cost of keeping up is brutal because information retrieval does not stand still.
- Figuring out why routine operations are slow or output unexpected results. Most search systems are far trickier to set up than licensees expect. With many knobs to turn, Fast Search could be tweaked so that results could boost certain content or address relevancy under specific circumstances. In a complex system, like Fast and many others, turning one knob and experimenting with threshold values could cause some darned exciting consequences. Rolling back those changes was an exciting operation in itself. When a Fast engineer had to figure out how to get the system back on track, the work was not trivial. What’s it cost to get an expert engineer to figure out what a licensee did? In many instances, a lot.
If you add up the costs of the technical work required for a complex search system, the need for money is significant. Dr. Lervik is not a financial expert; he is an expert in information retrieval. Not even ex-Googlers are adept managers. Witness the AOL goof related to “distressed babies.”
But a senior manager is expected to find solutions to difficult managerial, technical, and financial challenges. If the news story is true, it seems that Dr. Lervik was caught in a situation that set the stage for the unfortunate drama that has been playing out over the last five years.
The big question is:
Will other search and content processing vendors find themselves in a similar situation?
In my opinion, yes.
Warning signs are easy to spot. When search vendors that are seven or 12 years old continue to suck in venture funding, the warning flags are flying in my opinion. Search is essentially a zero license fee utility at this point. Firms that have yet to return a profit or show significant growth may find themselves taking financial short cuts.
The Xenky analyses make clear that financial stress is nothing new to search vendors. Check out the Convera, Delphes, and Fulcrum Technologies profiles. What’s different is that in today’s business environment, the consequences may be increasingly severe. You can find case studies of search vendors at www.xenky.com/vendor-profiles. There is no charge for these reports. Many describe enterprise search solutions that struggled financially and either shut down or sold out.
Enterprise search is a tough business. A sad quack for Dr. Lervik.
Stephen E Arnold, February 10, 2014
February 10, 2014
Americans in Paris. The stuff of songs. Sometimes Americans and the French struggle to find common ground. There is cheese. French cheese does not often come in shrink wrapped plastic. French wines are different from the stuff whipped up in California.
I noted another example of what I call the “French waiter syndrome.” The FWS refers to the problem some Americans find when ordering a meal in France. The opportunity for misunderstanding increases with the emergence of more and more American traits.
Here’s a recent example: The Google.fr home page.
interesting. I assume ideas about privacy are part of the FWS.
Stephen E Arnold, February 10, 2014
February 3, 2014
A happy quack to the reader who sent me a link to “Max Mosley: Google Is So Arrogant They Do Whatever They Like.” I am not sure about the accuracy of the story, but the tone and approach was interesting to me.
The focus of the article is Max Mosley, who “served as the long-time president of Fédération Internationale de l’Automobile (FIA), the governing body for Formula One and other international motor sports. My hunch is that the fellow is not a fan of Google’s self driving vehicles, but I am just speculating.
The gist of the Mosley Google mash up is that:
Google continued to list search results containing links to illegal photos of Mosley. He sued in both France and Germany to have the images automatically filtered out of search results. In November 2013, a Paris court ordered Google to filter out nine images. The California-based company says it has already started the appeals process against that ruling. On Friday, a Hamburg regional court issued a similar verdict. It ordered Google to block six images showing the racing boss in a compromising setting…
Tucked in the article were several comments I jotted down as quotes to note:
- “It is enormously expensive to sue in the US. Besides, to be honest, I have very little confidence in the US courts. If I had sued in England, it would have been seen as an entirely English thing. The truth is that it’s a European issue. And that’s why I took it to Germany and France — both countries have weight in Europe.”
- “If you ask Google to “take down these pictures,” then they do it, even though they aren’t very quick about it. At the same time, Google denies that it has the technological capacity to filter out images. But that’s nonsense. They are actually lying. And this despite their motto “Don’t Be Evil”. There’s something seriously wrong with Google. Technologically, they’re brilliant, sensational. But morally, its management is completely adolescent. The company is so big and so arrogant, they do whatever they like, they think they are above the law.”
- “But in the end it has to decide whether it wants to live in a democracy. Google behaves like an adolescent rebelling against the establishment.”
Mr. Mosley reveals that he uses Gmail, adding, “I am certain that Google reads all my emails.”
Stephen E Arnold, February 3, 2014
January 7, 2014
The Washington Post story “Government Questioned MicroTech about Its Role in HP Fraud Allegations” puts search and content processing in the spotlight. The newspaper is digging into the interesting underbelly of US government contracting. (The full series is at http://wapo.st/19aZwPh.)
I am certain that there are many fascinating tales about the interactions of contractors, contract officers, politicians, and lobbyists. The Washington Post is hopping into the fray and not a minute too soon to probe activities somewhat less fresh than the Healthcare.gov project or a number of higher profile projects, including tanks that are orphans and fighters that are too slow, underarmed, and unable to outperform fighters from certain other countries.
In fact, I think the HP-Autonomy deal closed a couple of years ago and US government contracting has been chugging along in its present form for 40, 50 years. Perhaps the procurement processes will change so that contractors’ business practices can change accordingly.
I found this passage from the Post story interesting:
MicroTechnologies LLC is among two companies and six executives who are said to have taken part in the efforts to boost the revenues of software maker Autonomy before its sale to HP, according to documents prepared by the Air Force deputy general counsel’s office that raised the possibility of barring all the parties from receiving federal contracts.
The Post story was picked up by other “real” journalists, including the estimable Telegraph in the UK (See the British take in “Autonomy Founder Mike Lynch under Fire from US Air Force over HP Claims.”)
After working through the stories, I formed several hypotheses:
- Resellers bundled software, storage, and hardware for clients. The reason may be due to a desire to get an “appliance”, not a box of Lego blocks or to procure a system without having to go through the uncertain process of getting approval for a capital expenditure.
- The indirect sales model used by Autonomy with considerable success required Autonomy to pay money when the reseller picked up the phone and said, “We sold a big deal, and we need cash to move forward” or some variation on this theme that is well known to integrators and resellers.
- The business process in place provided payments to resellers because of the terms of a particular agreement with a reseller or class or partners. Autonomy purchased some resellers and integrators to respond to the challenges the indirect sales model posed to Autonomy since 1998.
- Some combination of factors was arbitrated by Autonomy’s financial team.
Autonomy purchased the Fast Search & Transfer government sales unit and that group may have imported some of Fast Search’s procedures.
With Dr. Michael Lynch inventing video technology like US8392450 and US 8488011 filed coincident with the HP closing, was he able to dive into reseller deals?
The fact is that Autonomy is now a unit of Hewlett Packard. What few pay attention to is another fact. HP was an Autonomy partner for a number of years prior to its purchase of Autonomy. HP was part of Autonomy’s indirect sales channel and presumably knows how procurements, sequesters, allocated funds, and the other arcana of US government procurement “works.”
Dr. Lynch did something no other search or content processing vendor serving the enterprise market was able to do. From the inception of Autonomy in 1996, he exhibited an uncanny knack for recognizing trends and incorporating solutions to information access problems on top of those trends. In the course of Autonomy’s trajectory from 1996 to 2011, Autonomy grew as a modern day roll up that generating almost $850 million in 2011.
I am supportive of a historical understanding of search and content processing. On one hand, Autonomy is now HP’s information processing prodigy. On the other hand, HP may not have the management or technical skills to build on Dr. Lynch’s work.
Oracle paid about $1 billion for Endeca, a system that dates from roughly the same era as Autonomy’s system. But HP paid $11 billion for Autonomy and discovered quickly that surviving and thriving in the odd universe of enterprise search and content processing is tough when the steering wheel is in its hands. Is Dr. Lynch on track when he suggests that his management team was more skilled than some realized?
Investigations into government contracting procedures are quite fascinating. I know from some of my past work that bureaucracies work in mysterious ways.
Perhaps some of these mysteries will be revealed? On the other hand, some of the mysteries may never be known. Where are the Golden Fleece awards today? Do bureaucracies have teeth? Do bureaucracies protect their own? Do special interests exert influence? These are difficult questions.
Maybe there will be answers in 2014? On the other hand, there may be more public relations, content marketing, and spin. I hope those involved with the matter dig into Bayes-Laplace methods, Shannon information theory, and Linear Weight Networks. The methods can help separate noise from high value information.
Stephen E Arnold, January 7, 2014
January 7, 2014
If this tale is true, it gives us a new angle on real journalists. Blogger Nate Thayer charges, “How Ted Koppel and ABC TV Tried to Steal my Life Work.” The freelance journalist’s post begins with a bold move: Thayer declares that though he is legally prohibited from describing what happened, he is doing it anyway. Thayer all but dares his nemeses to try to reclaim their settlement money, which he says went to lawyers and taxes anyway.
As most legal sagas do, this one begins years ago. We are told:
“On July 25, 1997, I was the first outsider to meet Pol Pot since he killed 1.8 million people 20 years before. It was, for a couple of days, the biggest story in the world. I, as a freelance journalist, had the only photographs and video and eyewitness account that existed since Pol Pot did what he did. It was a tumultuous few days of dealing with the very worst of what the big media companies represented.”
See the story for the details (and see here to brush up on Pol Pot), but basically Thayer says ABC agreed to certain terms regarding Thayer’s valuable footage, then brazenly broke them, callously scooping Thayer of 15 years of work.
“My picture, credited to ABC TV, was published on the front pages of hundreds of newspapers around the world, my footage was distributed around the globe, and my story was written in virtually every major news organ on earth, credited to ABC TV, before I actually had written my own story…. ABC distributed transcripts of the trial of Pol Pot I had made and allowed other news organizations to view the video tape with strict instructions to credit ABC for the images and story, and then refused to pay me anything unless I signed a release that they did nothing wrong and I promised not to take legal action against them. I refused.”
After spending seven years in court over this betrayal, and winning, why publish these charges now? It looks like Thayer is more interested in exposing ABC as a nest of journalistic-integrity-challenged cads than in recompense. Naturally, there are multiple sides to every story; we don’t know what Koppel and company would have to say about the matter. Though ABC may not wish to dignify the angry article with a response, apparently Thayer has gotten a lot of positive feedback on his post.
Cynthia Murrell, January 07, 2013
December 10, 2013
Those of us who have worked in IT have an idea just how complicated and frustrating computing systems are to set up and maintain. To the rest of the world, though, it seems like the process of implementing even a large system should be much more straightforward than it is. Those tasked with having a certain infamous healthcare website built can probably sympathize with the plaintiff in a case Business Insider calls to our attention in, “Bridgestone Sues IBM for $600 Million Over Allegedly ‘Defective’ System that Plunged the Company into ‘Chaos.’”
According to Bridgestone‘s suit, the huge system they paid IBM $75 million to build for them suffered from “system-wide failures” from day one, and has cost the tire company greatly in cash and hassle. For its part, IBM insists the problems resulted from Bridgestone failing to hold up their end. Not only did the company try to implement the system before it was ready, says Big Blue, they were guilty of “repeated failure” to do what IBM told them needed to be done for the system to work properly. (The article does not specify what, exactly.)
Personally, I am inclined to sympathize with IT pros, even those at the biggest firms. However, I think we must acknowledge that the convoluted nature of computing systems sets the tech category up for trouble in a world where consumers expect quick-and-easy service with a smile.
The article reminds us:
“When it comes to massive multimillion custom-built computer systems, problems frequently happen. Half of IT projects with budgets of over $15 million dollars run 45% over budget and are 7% behind schedule, according to research from McKinsey. IBM seems to have its share of troubled projects. In August, Pennsylvania killed a contract with IBM because, as of July, the project was $60 million over budget and over three years late.”
Will IBM find a way to overcome such troubles? Perhaps Watson can help find the answer.
Cynthia Murrell, December 10, 2013
December 4, 2013
The article titled ‘Fatal Flaws’ in Google’s Revised Search Antitrust Overhaul, Says Foundem on The Register reports that Google has still not made sufficient concessions to the European Union’s demands. Google has been defending itself against allegations of ‘abuse of dominance’ in Europe, an argument which circles around the tendency for search results filtered through Google to often lead to its own services. The latest attempt to reach a deal resulted in Google’s proposals being leaked. The article explains that this new proposal has been found wanting:
“UK-based price comparison site Foundem has long battled against Google’s alleged abuse of dominance in Europe. It is one of the best known complainants in competition commissioner Joaquin Almunia’s long-running investigation into the multinational Google. The company’s co-founders Adam and Shivaun Raff said today the revised proposals “suffer from all the same flaws” as Google’s previous submission to the EC – which was rejected after a formal market test attacked the fundamental weaknesses of that offer.”
Especially attacking the Paid Rival Links addendum to the proposal, the Raffs made it clear that they felt Google was stifling the competition. They even suggested that the Paid Rival Links were assumed to be for show, an outlandish request by Google that could be thrown out in the second proposal in order to show that some concessions had been made. Apparently Google saw things differently.
Chelsea Kerwin, December 04, 2013
November 27, 2013
I read “HP’s Meg Whitman Ordered to Face Autonomy Charges.” Hard on the heels of Hewlett Packard’s quarterly results, the company has to explain to one disgruntled shareholder why the Autonomy deal went south.
The write up states:
In the latest $1 billion (£647m) lawsuit, HP shareholders accused HP’s management team of ignoring warnings before it bought Autonomy for $11.3 billion (£7.3bn) in 2011 and that the company’s financial numbers had been exaggerated. It is also claimed that HP tried to get out of the deal before it closed. The company later took a nearly $9 billion write-down largely connected with the purchase.
The deal put a burr under some digital cowpokes’ saddles. HP paid $11 billion for Autonomy. At the time of the deal, Autonomy was an $800 to $900 million a year company. Some months after the deal closed, the canny HP management took an $8 billion write down on the Autonomy deal.
According to the Tech Week Europe article:
The investors allege that HP’s management was negligent because of the $8.8 billion (£5.7bn) write-down on the deal HP announced in November 2012. HP officials blamed ‘accounting irregularities’ by Autonomy executives in the months leading up to the deal. The investors allege that the resulting drop in HP’s stock price effectively wiped billions of dollars from the company’s market value. The FBI are said to be investigating the allegations, as is the UK’s Serious Fraud Office (SFO).
In the meantime, the HP deal has not generated the big time payoff that someone at HP assumed would result from the deal. HP, like many other search vendor buyers, seems to be learning that:
- Search is an expensive business to fund. Those marketing, research, and support costs are brutal. Most of the failed search vendors ran into financial trouble despite the ministrations of different CEOs. Maybe Autonomy was managed better? Interesting question.
- Search, by itself, is not a compelling product or service to many potential customers. As a result, search is no longer search. Search embraces dozens of functions from text mining to the ubiquitous and fuzzy Big Data. HP is now trying to market lots of search related products and services. My hunch is that this is a bigger job than trying to sell $11 billion worth of key word search licenses.
- Companies that are not really software centric do not understand the oddities of the enterprise search sector. My view is that MBAs at outfits like HP assume that their Swiss Army knife budgeting and managing skills are going to “fix up” an outfit like Autonomy. Billions will flow as a result of the MBA approach. Who needs a PhD with an aptitude for math to run a mere search company. HP is coming to grips with its own shortcomings in the vision and motivation departments of Autonomy.
An ironic twist to the tale is that HP licensed the hugely complex, expensive, and cumbersome Verity system. With the purchase of Autonomy, HP became the owner of Verity’s technology. The six figure license deal for Verity is now free when viewed one way. On the other hand, that Verity technology cost HP billions of dollars.
And what about the founder of Autonomy? Dr. Michael Lynch has set up an investment company called invoke capital. The company took an interest in Darktrace, a security firm. Dr. Lynch, according to the Financial Times,
…is also a defendant in a suit by HP’s shareholders relating to the acquisition. A court in San Francisco this month gave HP a deadline of January to complete an internal audit, a decision welcomed by Mr Lynch.
The year 2014 may hold more fodder for business school case studies about Hewlett Packard and Autonomy. I am eager.
Stephen E Arnold, November 27, 2013