RealTime IT News

Inktomi Lands Net Software Firm

Search engine giant Inktomi Corp. made a major move in the enterprise market Thursday with its purchase of search software specialist Ultraseek Corp. for $344.7 million in cash and stock.

Inktomi will acquire all of Ultraseek in exchange for $3.5 million in cash and Inktomi common stock worth $341.2 million. Of the total consideration, $317.5 million will be provided to GO.com.

Inktomi grabbed the Go.com subsidiary to build on its search capabilities in the enterprise market. Ultraseek provides a scalable and customizable search and navigation software solution to businesses for their corporate intranet and extranet sites.

With the addition of Ultraseek, Inktomi can better address the growing enterprise information portal market with an efficient packaged search solution. Inktomi said it recognizes that companies demand fast search methods as a standard for their corporate intranet and extranet data.

"Our move into the enterprise market sets the agenda for the delivery of search and navigation software for intranet and extranet sites," said David Peterschmidt, president and chief executive officer of Inktomi.

GO.com Chairman Steve Bornstein said the deal demonstrates GO.com's commitment to focus on and enhance its position as a leading provider of consumer entertainment, information and services on the Internet.

Acknowledging that Ultraseek's software is better suited for Inktomi's strategy than for Go.com's "consumer-oriented strategy," Bornstein said the play was a "win-win" sitaution for both sides. Bornstein said GO.com will retain its consumer search technology and services, which are integral components of its leading Web properties such as the GO.com portal, ESPN.com and Disney.com.

The transaction is expected to close in the September quarter. Ultraseek will operate under the Inktomi name with all employees of Ultraseek joining Inktomi.

Alex Edelstein, president of Viralon Corp. annd former general manager of Inktomi's search business called the deal a "powerful one."

"Ultraseek has long been considered one of the most polished enterprise solutions, but has perennially suffered from being part of first Infoseek and then Disney/Go," Edelstein said. "These companies put most of their focus in the consumer space. The addition of a strong enterprise search product to Inktomi's lineup forges a strong new tie between Inktomi's enterprise Traffic Server business and its powerful Search Engine brand."

Edelstein said he expected Inktomi to step out aggressively with Ultraseek and boost its market share.

"I also expect Inktomi to develop new integration between its Internet Search and Shopping services and Ultraseek, enabling companies to merge their Internet and Intranet search capabilities."

Inktomi last inked major deals in March when it unleashed a broad initiative to deliver infrastructure software to wireless data operators.

The push into wireless content delivery is part of Inktomi's new portal services and network products. The Internet infrastructure software developer also locked-up six new alliances to help expand its reach into the wireless marketplace.