This past weekend Autonomy agreed to buy some key digital pieces of Iron Mountain, a company that has been having trouble recently. The digital pieces make sense from a content management standpoint and include archiving, eDiscovery and online backup.

According to a statement from Autonomy, the deal was for $380 million in cash. This deal won't have any impact on Iron Mountain's physical document archiving business, which will go on.

Autonomy CEO Mike Lynch said in a statement that he sees this purchase as a way to expand Autonomy's role in the cloud. "Processing customer data in the cloud continues to be a strategic part of Autonomy's information governance business. We look forward to extending regulatory compliance, legal discovery and analytics to a host of new customers as well as enabling the intelligent collection and processing of non-regulatory data from distributed servers, PCs and especially tens of millions of mobile devices," Lynch said.

It certainly expands Autonomy's coverage across all of these areas and gives the company a big role as a cloud player, just as that business is beginning to grow enormously.

But analyst Alan Pelz-Sharpe from the Real Story Group writing in a blog post thinks this could be a case of Autonomy buying more overlapping technology. "...Autonomy has just bought yet more overlapping products to add to its already large portfolio of acquired products and companies. Only last week one of our research subscribers told me his organization had little interest in working with Autonomy, saying 'they have some interesting stuff, but it seems like it's just a holding company.'" 

Pelz-Sharpe added in an email, "The move is not going to have much impact on Iron Mountain as this branch of their business was never that large. But the customers they did have are going to want to hold Autonomy to at least the same levels of service, and that could be a challenge as this is not a strong point of Autonomy's business."

Regardless, the purchase comes at a time when Iron Mountain appears to be in turmoil:

• According to a story on Mass High Tech, in April "CEO Bob Brennan resigned as CEO, president and director of the firm, and chairman Richard Reese, who had been CEO from 1981 to 2008, immediately stepped back into that role." 
• There were also reports that Iron Mountain planned to shut down its digital storage business and had stopped taking on new customers in April.
• As though that weren't enough turmoil for one company, Mass High Tech also reported that the company was in the midst of a financial restructuring, possibly becoming a Real Estate Investment Trust and attempts by shareholder Elliot Management Corp. to have a greater role on the Board of Directors.

So it was against that backdrop that Autonomy swooped in and took Iron Mountain's digital pieces for a modest amount of money as these deals go.

For more information:
- see the Autonomy press release

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