Oracle acquires Endeca - our first take....

  • 18-Oct-2011

Oracle has announced its intention to buy Endeca, a major independent purveyor of Enterprise Search technology. It's not in the least bit surprising as Autonomy (arguably Endeca's biggest rival) had been in talks with Oracle prior to their acquisition by HP, and from that alone it was clear that Oracle was interested in acquiring advanced search technology.

Though financial details have not been disclosed it is safe to assume that Oracle paid far less than the $10 Billion-plus that HP spent on Autonomy. Oracle's interest seems a bit more focused however, as they are currently growing their online retail capabilities. As such this acquisition fits in neatly with that strategy and logically enhances the functionality Oracle obtained via their prior acquisition of ATG.  I say "logically" because these tools are not boxes in a powerpoint diagram; they are living systems and any post-merger integrations will be painful for existing customers -- as it always is. 

So what has Oracle actually bought? As subscribers to our Enterprise Search Report already know, Endeca has carved out quite a niche in providing unstructured data analytics in the retail sector, with decent -- albeit broadly mimicked -- guided navigation capabilities. With the right resources (important caveat!) you can also scale their product impressively. Additionally Endeca has a pretty good reputation for customer service and for investing in ongoing research and development, in sharp contrast to Autonomy. 

Yet no product is perfect and Endeca has its challenges too. As a system it promises so much in terms of accuracy that there is often a serious pay off in terms of data cleaning, pre-processing, and resource commitment. Endeca is not simple stuff.

Note also that Oracle already has a search engine of its own called Oracle Secure Enterprise Search. SES serves a somewhat different purpose to the Endeca product, but there is definitely some overlap and customers will want to stay wary.  Oracle SES is a pretty good enterprise search engine, with the ability to federate different data sources within an organization, a common but important workaday business requirement. This is distinct from Endeca's analytical approach to delivering somewhat canned queries to browsers, most typically found in online retail settings.

As always time tells the truest story here. Yet it does pose the question: who is next?  There must be a number of Search vendors out there hoping that they will be acquired soon, and hoping even more strongly that they don't get left on the shelf. Search is a very important element of information management, but for years it has struggled to define itself as a standalone product entity, as opposed to being embedded functionality within enterprise applications and infrastructure. Today's acquisition, following hot on the heals of HP's acquisitions and plans for Autonomy, leaves even fewer standalone players.

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