back to article Autonomy to HP: bollocks

The HP-Autonomy spat has, predictably, turned into a high-profile slanging match, with Autonomy founder Mike Lynch firing back at Meg Whitman via the Wall Street Journal. Hewlett-Packard has sensationally written down the value of the software company it acquired last year by nearly $US9 billion, and blamed Autonomy for “ …

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  1. Richard Jones 1
    Happy

    Due Diligence?

    If you have ever been involved in due diligence and seen how well it is received by those who want a deal, you would not be surprised at this one.

    The last one I did was over a very small outfit. I valued the company at something like < 4% of its existing debt to us. However someone wanted it (or wanted their friend to get out from under it) so it went ahead and we bought the operation, cleared the debt and paid over cash totalling more than the accumulated debt.

    We had to shut it down a matter of months later.

    My valuation representing its hard assets in terms of scrap metal turned out to be about right; it made the current crop of zombies look good.

  2. Why Not?
    Coat

    I just bought

    I have a shiny new HP printer, just found out it will cost me 5 - 10 times the purchase cost for consumables.

    Can I have my money back?

  3. Anonymous Coward
    Anonymous Coward

    Revenue Recognition

    This will turn out to be dodgy up-front revenue recognition on multi-year deals to inflate the value of the company.

    1. This post has been deleted by its author

  4. Anonymous Coward
    Anonymous Coward

    HP

    My HP printer no longer works. Good money was paid for it a few years ago, and in expensive ink cartridges since. The electronics retailer in a wilful effort to mislead had led me to believe I could print out documents and photographs on it, or use it as a scanner (which it wont do as it thinks the ink cartridges are incompatible?). I performed a whole host of due diligence before purchase but when you're lied to, it's hard to find.

    Also, my HP touchpad no longer works. Good money was paid for it a few years ago, it turned out to be incompatible with Wine (Cabernet Sauvignon).

    Also, their brown sauce is rotten, however their BBQ sauce is nice, however despite the picture of the houses of parliament on the bottle, it is made in the Netherlands and not by some brummies.

    Therefore I want an US and UK authorities to investigate alleged misrepresentations about printer ability, touchpad compatibility and sauce of origin.

  5. Anonymous Coward
    Anonymous Coward

    BBC Interview

    Mike Lynch is flatly denying the allegations in this BBC video: http://www.bbc.co.uk/news/business-20412186

    If true, I think the auditors / advisers / banks should hand back HP their fees on both sides (ie. Autonomy's and HPs should be refunded to HP). If the UBS banker can go to jail for 7 years for a £1.4bn fraud, someone should go to jail for this if there is a case of fraud (perhaps not for 7 years though, it's quite a bit less).

  6. James Pickett
    Paris Hilton

    I'm all for the removal of glass ceilings, but you have to wonder why HP has gone into a tailspin under both Carly and Meg.

    It it was Paris, I could understand...

  7. Matt Bryant Silver badge
    Pirate

    Interesting!

    Little birdie tells me the SFO have taken a look and not laughed the matter out the door. This will get interesting as Mike Lynch, former Mr Autonomy, is now a non-exec director at .... <drum roll!> .... the BBC! Won't do much for the Beeb's already battered image if a director gets sent down for fraud. Andrew Orlowski must be sharpening his pencil already....

  8. Anonymous Coward
    Anonymous Coward

    " the Beeb's already battered image"

    @Matt

    Yesterday on BBC R4, news items on this subject mentioned that Lynch was on the BBC board.

    A bloke called Marcus Agius is also on the BBC board, and has been for a few years, and when he's not 'earning' the 50K/yr or thereabouts that the licencepayer pays him, he's the Chairman at Barclays.

    Now in all the BBC news coverage of Barclays (which has sometimes been a bit thin, especially when it was bad news) I've never heard them mention that the Chairman of Barclays was on the BBC board.

    On the other hand, Agius was reportedly asked questions about this at the Barclays AGM this year and apparently found himself rather embarrassed.

    Why the difference?

    Purely by coincidence, the BBC was one of the few UK news outlets that didn't offer much coverage of Barclays news re executive salaries and top-shelf bonuses a year or two back, at a time when even the Sun was covering it. Also little coverage of news relating to Barclays fondness for arranging taxdodging schemes.

    1. Matt Bryant Silver badge
      Thumb Up

      Re: " the Beeb's already battered image"

      "Why the difference?" Oh, no difference! Indeed, quite the opposite, I'd be most happy to see an exposure of the Beeb's directors and any patterns of light coverage. It's supposed to be independent, impartial and public-serving, so I beleive the board should be just as open to scrutiny. As a matter of point, exactly what great insight into television or radio media, reporting or entertainment production did having a Barclays Chairman bring? Is "media luvvie" on his CV? Enquiring minds and all that.

      1. Philip Lewis
        Big Brother

        Re: " the Beeb's already battered image"

        Such an inquiry would be quashed instantly under the "purposes of journalism" principle.

  9. LOW
    WTF?

    In the beginning....

    ...were a couple of fresh faced Cambridge graduates sitting in my office with a genuinely innovative and potentially very useful product. Their kit promised to be XML before XML was even a standard..

    I was working in a major international law firm with 4.5 million documents that were growing like billio (unsure of sp, there and can't be bothered to look it up before you commentards go at my spelling) and we needed a way to find how we'd constructed documents in previous deals n order to cut down our overheads in the future.

    I spent a long time with these guys, and they gave me a fabulous piece of search kit to play with for free. As it turned out, their stuff was rubbish for legal documents and we came to the conclusion that no amount of training (if you're not familiar with training software, think about training OCRs - it was basically the same scenario) would solve the problem.

    As it turned out, we came to the conclusion that Goldfarb and Prescod had got it right with SGML (which was created to handle IBM's legal documents, globally - for the non-initiated among you, XML is a direct sub-set of SGML and it handles legal documents rather well and, unlike SGML doesn't require a couple of years to learn) and, really, no amount of training would solve our problems. We really tried.

    To give you a specific idea of what the problems were, the word "service" is used in many different contexts in the legal world and none of us found a way of training an artificial intelligence machine to deal with that in a humane way - we just got junk in the search results. So, back to what's now called XPath and XPointer, I believe. It's been a while and this was "back in the day".

    However, using the same kit to search the internet pissed all over everything available (and it would put Google to shame today, IMHO). Fabulous stuff.

    After I'd done the research for them, they disappeared from the market and you couldn't buy their product unless you were a Rothschild funded government. Having spent over a year using Autonomy's kit on a daily basis, I was gutted when they pulled it from civilian life but did understand why it wasn't available to me any more.

    In my experience HP make great hardware but don't ask them to give you software - their software just ain't as good as the sauce we all know and love.

    HP really missed a trick there and more fool them. Autonomy came up with a brilliant game changer for searching in-homogenous data sets i.e. the internet and they are still a legend in my mind. Oh how I wish for a web search engine like that again.

    As for Google, bah, yank spyware pish full of advertising crap that I don't want to see. So I never use their engine that was designed to wow noobs and, as far as I'm concerned Google is still not mature enough for a serious researcher who needs to find facts now, for a business case. So in my mind, Google is 20 years behind the times. Twats.

    Oh remind me, what's Google's revenue model again? Oh yeah, the emperor's new clothes.

    1. Barry Mahon

      Re: In the beginning....

      I note you said "in previous deals" does that mean previous software or just documents from "deals" - cos if it is the former maybe you'd been trying others??

      I wonder was it after Autonomy bought Verity which, like many others, was a good search engine before Google, that you found Autonomy useful for general searching?.

      Google got there because they used a distributed model, still do, where the searching is paralleled, cutting down the time it takes. Google were also in the right place, the explosion of cheap server farms coupled with (relatively) lower priced comms.

      As I said in a previous post Autonomy required, as you noted, (paid for) training, You sound like an experienced information person. IMO, Lynch copped on that it was a lot easier to sell to people who didn't understand the information business, or worse, thought that the information business was crap and 'computers' could do it.....

  10. Anonymous Coward
    Anonymous Coward

    HP Board, shower of Bastards ?

    I really dont get what HP are up to. They are obviously incompetent at buying Autonomy at that price. But now get the lawyers in ? There is zero chance they will get any of the money back; the lawyers will cost more than they take ?

    Is the HP Board completely stupid or is this some plan to fend off activist investors from splitting the company up ?

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