Microsoft to buy FAST
Microsoft offers to buy FAST for $1.2 billion
Microsoft said Tuesday that it will offer $1.2 billion in cash for Fast Search and Transfer (FAST), a big player in the enterprise search market.
The move is sure to shake up the enterprise search market, which thus far has been dominated by a series of smaller players like FAST, Autonomy and Vivisimo. Google has made some inroads, but for the most part the market is the realm of niche players. Microsoft is about to change that with FAST. You can expect Google to make a purchase in enterprise search along with traditional enterprise players like HP, IBM and the usual suspects.
In a statement, Microsoft said its offer is a 42 percent premium to where FAST shares trade in Norway. FAST’s board of directors has recommended that shareholders take the offer and the company’s two largest shareholders–Orkla ASA and Hermes Focus Asset Management Europe–are on board with the deal. The transaction should be completed in the second quarter.
FAST counts Comcast, Disney, Microsoft, Pfizer, UBS and others as customers. In its most recent third quarter, FAST had revenue of $35.6 million, up 4 percent from the second quarter. Third quarter recurring revenue was up 65 percent from a year ago. Fiscal 2006 revenue topped $162 million, according to FAST’s annual report. The company is profitable and had $137.9 million in cash at the end of its third quarter.
Microsoft is likely to raise a ruckus in enterprise search and force consolidation among FAST’s rivals. Microsoft can bundle FAST with its Microsoft Office SharePoint Server and probably poach some features for its consumer search if warranted. And Microsoft will gladly take FAST’s search engineering talent. I did an overview of enterprise search last year and highlighted how long it takes to deploy. In a nutshell, enterprise search is more complicated than slapping in a search appliance because you have unstructured data.
by ZDNet
Microsoft Buys Search Engine FAST, Won’t Fix Microsoft Live
FAST is a profitable enterprise search company based in Norway with about $400 million in revenue ($333 million in 2006). Microsoft offered $1.2 billion for the company, approximately 42% more than the share price.
The acquisition plays to Microsoft’s core strength–the enterprise–and therefore makes sense. However, it will not directly help improve Microsoft’s position in consumer search. FAST does provide OEM search to LookSmart and others, but Microsoft’s problem in consumer search is not technology–it is habit and brand. So even if FAST’s technology represents a major improvement, this will not likely result in search-share gains.
by AlleyInsider
Microsoft acquires corporate search engine firm
Microsoft Corp. is spending $1.2-billion (U.S.) to take over a key player in an expanding search engine niche: helping companies sort out and retrieve internal corporate data.
The software giant has agreed to buy Norway-based Fast Search and Transfer ASA, a company that specializes in “enterprise search” software that helps workers in large corporations find crucial internal information.
The Fast software will complement Microsoft’s existing SharePoint products, which organize corporate data, documents and websites.
While enterprise search has a far lower profile than other retrieval software technology - such as Google’s ubiquitous Internet search engine - it is a huge and growing business.
Enterprise search “will be for workers tomorrow what Internet search is for consumers today,” Jeff Raikes, president of Microsoft’s business division, told analysts on a conference call.
This software will be an “indispensable tool that will help [employees] find the information they need,” he said, citing studies that suggest as much as 70 per cent of any company’s information is inaccessible, because its locked up in some kind of corporate repository.
A company that employs 1,000 workers who deal with information can expect to waste $5-million a year in salary costs, because of unproductive time used to look for data that’s hard to find, he said.
“Today you can find football scores online in five seconds, but inside somebody’s company it can take five hours to track down last year’s business plan.”
Solving this problem is potentially lucrative, analysts say.
“There may be just as much money in the enterprise search market as there is in the Web search market,” said Ken Poore, a senior analyst at Forrester Research Inc. in Cambridge, Mass.
Fast was the second-largest player in this business, after Britain’s Autonomy Corp. PLC.
Now that Microsoft has picked up Fast, Mr. Poore said, Autonomy and other players such as U.S.-based Endeca Technologies Inc. may also be in play, because companies such as IBM Corp., Oracle Corp. and Google Inc. are trying to expand their enterprise search businesses.
While Fast usually deals with big corporate customers, its software does sometimes come into contact with individual consumers.
That’s because Fast search engines are used to operate the websites of some major retail organizations such as AutoTrader.com, TVGuide.com or WeightWatchers.com. When consumers enter those firm’s websites to search for a car, television show or recipe, they are using Fast software to find what they are looking for.
Still, enterprise search occupies a very different niche from that of general consumer search engines such as Google.
On the consumer side, players have had a very tough time carving out specific markets for “vertical” search engines that do one thing very well, said Jeffrey Lindsay, senior Internet analyst at Sanford C. Bernstein in New York.
That’s partly because Google itself has managed to create an “all-appealing branded search that people have got used to and developed a level of comfort with,” Mr. Lindsay said.
Because Google incorporates clever vertical-market software behind the scenes, consumers don’t need to use specialty search engines, he said.
“A lot of scientists use Google to do research on really hard subjects, kids use it for their homework, and people use it socially to look up facts and figures or to find restaurants.”
Still, that hasn’t stopped developers from trying to displace Google from some markets.
Wikia Inc. for example, recently launched a new search engine called Wikia Search, which is supposed to use social networking tools to rank results in a more usable way.
by TheGlobeAndMail
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