IBM Purchases iPhrase Technologies

Zachary McGeary | November 02, 2005, 04:24 PM

IBM announced yesterday afternoon that it acquired iPhrase Technologies, a provider of self-service search technology and applications, for an undisclosed sum. It seems the acquisition was more for the underlying search technology and not necessarily the applications built on top of search. However, IBM seems to have madea committment to existing iPhrase customers as well as to continue the development of iPhrase's core technology and applications...as well as sell the applications through their existing sales channels.

iPhrase's underlying search technology lends itself nicely to IBM's Unstructured Information Management Architecture (UIMA) initiative, not to mention is already WebSphere compliant. How convenient.

What does this mean for the self-service search space? Well, now iPhrase's products now have a more robust and focused distribution channel. Nonetheless, IBM is not traditionally an application company so it will be interesting to see how much they invest in continued development of the product. IBM has promised existing iPhrase customers that their investments will continue to be supported. WARNING: if you are an existing iPhrase customer and not on the WebSphere platform, expect a huge migraiton push come contract renewal time. Apparently you don't need to migrate, but just know that the option will be pushed hard by your new vendor. And that the iPhrase name and product functionality will be phased into an IBM offering some time next year.

Does this mean less competition in the self-service search space? Well, yes. It sounds like the technology, after being incorporated into an IBM offering will be more enterprise focused. I believe there will continue to be some competition in larger enterprises where self-service search is integrated into larger CRM or contact center applications (e.g. Siebel, Onyx). Interestingly, InQuira (a competitor of iPhrase in self-service search) is also an IBM partner.

Overall, this is a great move for iPhrase Technologies whose product functionality far exceeded the capabilities of iPhrase to actually deliver and profit from it. IBM is far better positioned to capitalize on the search technology, but my guess is an eventual move away from self-service search application competency.