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Microsoft FAST Acquisition Suffers From Brain Drain

The big news Tuesday was Microsoft's acquisition of Fast Search & Transfer (FAST), makers of intelligent search technology which already integrates with Microsoft's server technologies. Surprised? No, of course not -- just another move by Microsoft to acquire and increase competitiveness in Google's market space.

Not only the pace of information creation has increased (email, IM, web, RSS, etc.), but this has created a virtual layered stack of communications occurring within digital world of information we operate. Search means so much more to us now than just doing a Google or Windows Live search. It's about finding threads of content, organizing them and understanding the information. Now that I have tools like content search in emails, files and directories, and tools like Feedemon to manage RSS information, it's hard to imagine living without them. Adding FAST's technologies to Microsoft's portfolio is in many ways a must for Microsoft's future, Google or not.

But did Microsoft acquire what it really needed in the FAST acquisition? Google's interview tactics are infamous, coming up with ever more creative ways to identify software engineers who bring needed talent to Google's search technology and development gene pool. FAST suffered an operational meltdown, as Guy Creese of the Burton Group put it, laying off 148 of it's workforce according to a September 2007 Forbes article.

If you've ever experienced or had to implement a layoff, you know that the drop in tangible headcount doesn't reflect the real losses of talent from the organization. My experiences are that you unavoidably lose some of the best and brightest. That happens for many reasons; concern by the employees about the instability and future of the company, the eminently hirable (best talent) now have a reason to consider the ever present recruiting inquiries, dissatisfaction with how employees are treated during the layoff, and fear when the proverbial "other shoe will drop". It's ironic but it always seems that the eminently hirable are the ones most worried about finding a job.

What kind of brain drain might have FAST suffered during the 2007 layoffs? Acquisition rumors that Oracle, Microsoft or IBM could be taking over might offer some calm or could drive up the instability and panic. In addition to previous poor financial performance, a brain drain may have also driven down the FAST buying price, resulting in the "bargan" many say Microsoft got for FAST.

Microsoft may have bought the company but it's tough to tell whether all of the talent needed to close the competitive gap with Google will show up along with the FAST search technology Microsoft purchased.

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