IBM takes swipe at HP's Autonomy buy

By Maggie Holland on Oct 26, 2011 8:20 AM
Filed under Hardware

'We're a little more thoughtful as to how we spend shareholder money'.

IBM has criticised HP's $US10.2 billion ($A9.8 billion) acquisition of British software company Autonomy as poorly considered and unlikely to deliver value to shareholders.

“It doesn’t really matter whether Autonomy is an independent company or part of HP. We competed with them before and will compete with them again,” Steve Mills, senior vice president and group executive of IBM’s software arm, told delegates at Big Blue's 2011 Information on Demand and Business Analytics forum this week,

“The question is ‘How is HP going to leverage [value] from Autonomy?’ They certainly spent a lot of money to acquire it. It’s going to be tough to get a return. We’re a little more thoughtful as to how we spend shareholder money.”

IBM contrasted HP's acquisition strategy with its own, which it said had delivered a stronger technology portfolio.

It’s been less than a week since IBM’s most recent acquisition was finalised, but the company’s hunger for buying shows no signs of abating when it comes to firms that will help broaden its product set and provide competitive advantage.

IBM completed its acquisition of Algorithmics late last week. Earlier this month, the company also announced plans to acquire cluster and grid management specialist Platform Computing for an undisclosed sum.

“We have put together the industry’s most comprehensive portfolio. We’ve invested to lead. Our growth rates, market share and position is really unrivaled,” said Steve Mills, senior vice president and group executive of IBM’s software arm.

“Obviously I cannot tell you what we may buy tomorrow,” he said in response to a question posed during a press conference at the IBM Information on Demand (IOD) conference in Las Vegas, which highlighted a focus on infrastructure and middleware acquisitions. “The answer is always the same in that we’ve been following a pattern of building out competitive capabilities in market spaces we’ve chosen to compete in.

Meanwhile, a little over a year since IBM snapped up Netezza for $1.7 billion, Big Blue was celebrating the fruits of this particular purchase.

The majority of customers (84 per cent) who engage in a Netezza proof of concept implementation, go on to roll-out the technology, according to Arvind Krishna, general manager of IBM’s Information Management Software division.

“I think that’s a hard statistic for any of our competitors to meet or beat,” he said, adding that Netezza systems can be set up and running in just 24 hours rather than days.

“We will keep investing [in such technologies] as part of our mission to support you.”

IBM fellow Curt Cotner added: “The acquisition of Netezza now means we’re a big player in appliances. People can now purchase this, install it and be doing predictive work within 24 hours. That’s not the experience people are used to with this type of tech.”

The video below describes the reasons behind IBM’s Netezza acquisition.

This article originally appeared at itpro.co.uk

 
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