by Barry Murphy.

Today began with very interesting news — Autonomy entered into a definitive agreement to purchase message archiving and eDiscovery vendor Zantaz. This is a great purchase for Autonomy. They have already integrated IDOL server into Zantaz’s archiving and eDiscovery applications, so they can capitalize on synergies immediately. eDiscovery is a hot market for both companies — the combined entities will have likely the best brand value in the eDiscovery space. With organizations truly called to action by the Federal Rules of Civil Procedure (FRCPs), Autonomy/Zantaz has the solution set to help implement a short-term solution that can evolve into longer-term information management strategies (see our eDiscovery market overview for more information on how the FRCPs have become an information management spending driver).

This also makes Autonomy more attractive to the larger vendors, and I would not be surprised at all to see a CA, EMC, IBM, or Oracle in turn acquire Autonomy. Oracle makes the most sense as it is the only of the big infrastructure vendors that lacks the message archiving capability that Zantaz could provide.

This move also signals that the first domino has fallen in the eDiscovery market consolidation — the rest should begin to happen quickly. Take note – this acquisition sets the multiple at somewhere between 2x – 3x revenue (Zantaz was private, but estimates always put the company somewhere between $100M – $150M). eDiscovery pure-plays — get ready to entertain offers (and more importantly, be ready to accept them or get run over).

For Information and Knowledge Management Professionals or CIOs looking at eDiscovery and retention programs, watch for Autonomy/Zantaz to have solutions that can take you from the most basic message archiving deployments to advanced analytics-driven retention programs — the combined company should certainly be on any short-list for message archiving and eDiscovery.