Double Dip Recession and Enterprise Search
November 22, 2009
I loathe economists. The discipline is a weird game where words have to be learned so those in the know can talk about events beyond the reach of “models”. I listen to one economics podcast from George Mason University each week in order to keep myself awake. When I listen to the analyses, my adrenaline surges, and I am good to go for another four or five hours of work. I just get revved and ready like people who reacted to the Nixon campaign joke “Tan, rested, ready. Nixon in 68”.
I did find The Market Oracle’s “The Pending Financial, Economic, Political, and Social Collapse of the United States” timely. I was faced with dozens of broken escalators in Washington, DC last week, a multi hour delay when the air traffic control system “lost” aircraft, a MARC commuter train that was able to travel at 10 miles per hour, and one teleconference participant who missed a meeting due to a violent student protest over a tuition price increase. I am not sure how your week progressed, but I think that these are useful snapshots of life in late 2009.
The key point in The Market Oracle’s write up struck me as this one:
We need to start thinking about where we live and how we will survive an economic collapse. When the federal government can no longer function, what will we do to replace it? How are individuals to survive when essential goods and services become extinct? This isn’t a future scenario that will happen twenty or thirty years from now, no! We are already experiencing it.
Big ideas are not what capture my attention. I think about the impact of these types of statements in terms of enterprise search. Here’s what I see for 2010. Please, keep in mind that these are my opinions. If you don’t want to read them, navigate away from this page now. Honk!
- A number of search and content processing companies are going to go out of business. It pains me to point out that companies with interesting technology like Siderean Software are on what seems like permanent “hold”. Other companies like Grokker which have moved from utility to search to content aggregator have pulled in their claws. Unless additional funding is found, 2010 will be a tough one for search and content processing. After all, the advertising and marketing consultants need only a handful of vendors pushing “semantic thermometers” and “blog pulse trackers”.
- The industry leaders in search are going to chase other types of software services. I can see the trend now in Autonomy’s steady push into information sectors where search is important, but search is just one patch in a patchwork quilt of functions. Some of the vendors trying to use search as the foundation of enterprise software are going to find that making big dollar sales is expensive and time consuming. The technology may be fine, but the rigors of sales and marketing may exhaust the firm’s resources.
- The battle between Google and Microsoft is going to disrupt some organizations and create the equivalent of political warfare in the Dark Ages. I don’t see any way to bring rationality to the exchanges between the Google factions and the Microsoft factions. The financial impact of this battle will be some really great deals. The vendors are going to want lock in, and the repercussions will be important for years in an organization that jumps one way or another. Fence sitting might not look too bad for some organizations?
- Open source is following in the path of commercial software in the PC industry. I am all for open source, but the business models of the open source companies are not that different from the business models of the “old” IBM and Unisys type companies. The goal is to bill for services and anything else that can be added to the invoice. Success is increased billings. When I mention this trajectory to the open source champions, I get the type of look when I did one year of graduate work at a Jesuit university. Reality can be different from the facade in life and in open source.
- The “cloud of unknowing” about information access will become darker. In the last six months, I have been struck by the failure of organizations to learn basic lessons about search and content processing. I think part of the reason is the questionable marketing approaches taken by some 20 somethings. But a big part of the problem is that people in organizations responsible for search have not done their homework. Change is a repetition of the same old process that created problems on the last search procurement go round. Is it laziness? Indifference? I don’t know.
- Google is not seen or perceived in a way that is strategically useful. Google itself is a master of information and I don’t see the firm changing any time soon. This means that those who look at Google have to figure out why products like Chrome get so much attention and Google’s push into vertical rich media services and video conferencing gets so little. The phone companies provide ample evidence that their managers did not understand Google’s impact in telephony until it was, in my opinion, too late.
The double dip recession and the emergent third world environment in the US, if The Market Oracle is correct, sets the stage for an interesting thought: Is Google the revolution? The company might just be the next big, political thing. In the country of Google, what’s the role of Microsoft or other search and content processing vendors?
Stephen Arnold, November 22, 2009
I want to disclose the US Chamber of Commerce, a fine oversight entity, that I was not paid to write this opinion about the new country of Google. Who would pay me to write about Google as a country when it is so much more comforting to think about Sergey and Larry, eating a pizza, and learning about Cuba.
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