However the reaction isn’t all positive – the FT implies this deal is at the “lunatic end of the valuation spectrum”. Law Technology News says “Autonomy’s e-discovery revenue stream is high-end but unsustainable” and quotes users of the system with problems: “We had a lot of issues with the applications crashing, the documents tending not to get checked in”….”"[Autonomy sales staff] were pricey, arrogant, and they couldn’t care less about us. … It cannot get any worse.”.

HP will have to work hard to integrate Autonomy into both its corporate culture and software frameworks – a problem currently faced by Microsoft since its acquisition of FAST a short while ago. Stephen Arnold thinks this process will be “risky”. What it means for the rest of the search sector is harder to guess, although Martin White of Intranet Focus says this deal indicates HP can see a “future in search applications” and, interestingly, “A number of privately-held search vendors are probably working out what their valuation would be”.

My view is that this is just the latest of huge shifts in the enterprise search market, partly spurred on by the rise of open source options and the gradual realisation that the huge license fees charged by some vendors may be unsustainable. I don’t think Autonomy will be the last company looking for a safe haven in the years to come.

However there are some very interesting numbers in the latter part of the report. For example, we hear that an Exalead customer, the automotive logistics specialist Gefco, paid 700,000 Euros for the solution built for them to track around 100,000 events a day regarding 1 million vehicles. Appendix 2 has a list of various search vendors and associated costs: for example “The average selling price for the [Autonomy] IDOL tool is $375,000″ and “The price for the Oracle Secure Enterprise Search is $34,500 per processor and $70 per referenced user (with a minimum of 100 users).”

I would question whether these prices are sustainable given that alternative solutions based on proven, scalable open source software are now available at a fraction of the cost. Perhaps the authors of the report should have considered more deeply how this might impact the enterprise search market.

Apache Lucene and Solr, available as open source software from the Apache Software Foundation, are powerful, scalable, reliable and fully-featured search technologies. Solr is the Lucene Search Server, making it easy to build search applications for the enterprise.

With our long experience of customising, installing and supporting open source search engines, this partnership is a natural fit for us, and we’re excited by the opportunities it presents. In addition to our current offerings, Flax will now offer installation, integration and commercial support packages for Lucene and Solr, backed by Lucid Imagination.

Of course, there are sure to be teething problems – if you find anything that doesn’t work do let us know!

The NLA’s ClipShare and ClipSearch services, which are powered by Flax, are good models for monetizing newspaper content, and are already in use at some of the U.K.’s largest publishers. If you need to quickly find a particular story, see related articles and grasp an overview of coverage you need scalable, highly accurate search technology. Users have been conditioned to expect search to ‘just work’, and they simply won’t pay for anything that doesn’t come up to scratch.

Platform choice can be a key issue for those looking to implement advanced search, as there may be significant existing in-house expertise and investment in a particular platform. Our Flax solution works just as well on Windows, Linux or Solaris. It’s sad to see such a powerful technology as FAST become so narrow in focus, but it’s not particularly surprising after the Microsoft acquisition.

UPDATE: more coverage on this from The Register

1. Price cuts – possibly driven by even harsher competition between Google and Microsoft FAST, I can see prices coming down for packaged enterprise search. Autonomy will probably raise theirs
2. Real time search matures – not just Twitter or Facebook, but real time data from many sources being part of enterprise search results
3. More geolocation-aware search – in the U.K. at least, we’re seeing signs that the source data is finally being freed up, which should make it a lot simpler and cheaper to build location-aware solutions
4. A few less second-tier players in the market – it’s still difficult out there, I’m afraid not every company will survive the next year.

You’re welcome to take any of these with a generous pinch of salt!

I didn’t agree with Stephen’s main point that Google will crush us all – I think the battles between Google and Microsoft (and Google and everyone else) are a distraction. While they’re fighting it out the rest of us can get on with developing cutting-edge search technologies. Open source search technology gives us tremendous flexibility, allows us to develop solutions very fast, allows the customer to take ownership of the system that’s being developed and now has comparable performance, scalability and commercial support to the traditional closed source world.

The real question is how this will affect the profitability of existing companies in the search space. I wonder who won’t be around at next year’s Online Information show…

For more Enterprise Search events, there’s a calendar provided by Information Today which is pretty exhaustive.