"This completes the unbundling of enterprise and Web search, with one notable exception, and only one: Google," says Matthew Berk, senior analyst at Jupiter Research. But Berk expects Google, which sells a line of search server appliances unlike anything other vendors offer, to continue succeeding in serving both the enterprise and Web-search markets, a fence-straddling challenge no other vendors have been able to weather. Consider that in the past seven months:
Yahoo Inc. bought the rest of Inktomi's technology and product line in December for $235 million
In February, Overture acquired AltaVista's combined enterprise and Web-search businesses for $140 million
Just a week later, Overture purchased Fast's Web search for up to $100 million, including incentives tied to future revenue
In May, Kanisa Inc., a maker of customer-service applications, snatched up Ask Jeeves Inc.'s Jeeves Solutions enterprise search business for $4.25 million
Adding Overture's 200 AltaVista enterprise customers, which include Factiva, Monster.com, Citigroup, and federal government agencies, helps Fast move into a variety of key vertical markets, says John Rueter, Fast's VP of global marketing. Rueter says he expects the new customers to eventually move to Fast's technology as they need to deliver data faster and in larger quantities. But while Fast's long-term plan is to phase out the AltaVista product line and merge it with Fast's technology, "there is no immediate plan to force an end of life for AltaVista customers," Rueter says.
Berk says the deal is good for everyone involved—Overture, for which supporting enterprise search clients likely was proving a liability; Overture's customers, who will get strong support from Fast, which has retained five AltaVista employees specifically for supporting the inherited customers; and Fast, which further strengthens its enterprise search technology and "gets to prove its strength to interesting new customers."
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