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December 08, 2004

Use the CIA's search engine

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The Washington Post's David Vise wrote last Friday about Convera, a relatively small, low-profile provider of search software to the CIA, FBI, National Security Agency, Departement of Homeland Security, and the Pentagon.

The company's signature product, RetrievalWare, is used by thousands of analysts at these agencies as well as over a dozen foreign intelligence services.

Since Convera doesn't carry ads, it has to make its nut by selling the software.

So far, it's not done all that well: the company reported losing $4.5 million for the quarter ending October 31, compared with a loss of $3.3 million for the same period last year.

Revenue in the period fell from $8.7 million to $6.1 million.

The software has special features: for example, it automatically notifies users at the FBI when a new document matching a previous search query is added to the bureau's database.

Hey, almost sounds like RSS.

But I'm sure it's much better.

But maybe not.

After all, the government is known for being way, way behind the curve when it comes to computer technology.

For example, before 9/11 the FBI couldn't even communicate urgent intelligence agency-wide due to its primitive operating systems.

The company's also developing software that will let military and intelligence agencies search the public Internet in a way that cloaks their activities from potential eavesdroppers.

More interesting is the fact Convera's planning to offer its specialized Internet search engine to the public next year - for free.

They're going to sell advertising for that function.

The company says its search results, because they're based on an entirely unique algorithm and the company's proprietary technology, will be different from those provided by Google and Yahoo.

Memo to Convera: I don't care if the results are different, as long as they're more on point and focused.

In my limited experience, Yahoo's and Microsoft's search results are indeed different from Google's: they're much more limited and less comprehensive.

Who needs those kinds of differences?

Here's the Post story.

    Agencies Find What They're Looking For

    Intelligence community embraces search software

    When computer users hunt for information on the Internet, they typically turn to Google or Yahoo.

    When analysts working for U.S. intelligence look for documents and data stored on computers inside their own agencies, they often turn to software made by a little-known firm from Northern Virginia.

    While the high-profile battle between the major search engines that scour the Web rages on, Convera Corp. quietly has carved out a niche for itself: selling software that helps U.S. and foreign intelligence agents search their databases.

    The Vienna company is like a lot of small companies that are attempting to compete with the search engine giants, not by out-Googling Google, but by offering specialized services to organizations that are drowning in electronic data.

    "It is another whole level of search people don't consider," said Andy Beal, vice president of KeywordRanking.com, an Internet marketing firm.

    "It is a way to sell search technology piecemeal rather than mass branding.

    There are comparatively few companies doing it well."

    From the FBI to the CIA to the National Security Agency, and from the Department of Homeland Security to the Pentagon, thousands of analysts use Convera's software, which bears the moniker RetrievalWare.

    More than a dozen foreign intelligence services use it as well.

    "Who needs search more than these agencies?" asked Convera president and chief executive Patrick C. Condo in an interview.

    "As new foreign agencies cooperate with the U.S. in the war on terror, we are a source for products."

    Convera takes a different approach to the business of online search than the major players.

    For starters, Google Inc. gives away its search technology in more than 100 languages and pockets hundreds of millions of dollars by selling ads.

    In contrast, Convera depends on getting government customers to pay for its specialized technology.

    Regular profits so far have been hard to come by.

    Convera recently reported a $4.5 million net loss in the quarter ended October 31, compared with a loss of $3.3 million in the same period last year. Revenue in the period fell from $8.7 million to $6.1 million.

    The company is trying to rebound financially from years of unsuccessful efforts to expand into the business sector, Condo said.

    The company added too many employees in anticipation of new business and is now cutting back.

    Condo said the company is beginning to regain momentum, in part because its search technology has special features not readily available elsewhere.

    For FBI analysts, among the most popular features of Convera's software is that it automatically notifies them when a new document matching a search query is added to the bureau's database.

    The software also searches for patterns within data, identifying relationships buried in thousands of separate documents.

    And it allows analysts to save and retrieve search results easily for future review.

    In August, the FBI, which has struggled for years with handling data, chose Convera to provide it with new software systems to search internal documents and information agency-wide, including the capability to search audio and video archives in more than 45 languages.

    The FBI awarded the contract after relying on Convera for a year to manage its new "investigative data warehouse," which the bureau created after September 11, 2001.

    Since Convera software is used by numerous law information and intelligence agencies, it also offers the potential to address some of the major problems cited by the 9/11 Commission, including the failure to analyze and share important data gathered by different federal departments.

    Outside the intelligence community, RetrievalWare is being used at the Food and Drug Administration, as officials search medical research and other data when problems arise with existing medicines or drug companies seek approval for new products.

    While versions of Convera software have been used by some inside the FDA for a number of years, officials recently decided to make it available across the entire agency after converting about 20 years of documents into digital files that can be accessed electronically by those with proper clearance.

    "It has helped us in our regulatory review and research responsibilities," said Helen Mitchell, head of enterprise search for the FDA.

    Mitchell cited one researcher doing a fertility study who used RetrievalWare to identify all on-going and previous studies done by the FDA.

    "Before, people couldn't find everything if things were misfiled or they didn't have the time or resources," Mitchell said.

    "With the Convera software, and the technology for searching documents and patterns, they can find documents even with misspellings."

    As it refocuses its energies on the government sector, the company has plenty of money on hand as a cushion until it begins to turn a consistent profit, Condo said.

    Convera raised $10.3 million through the private sale of stock earlier this fall and recently reported $22.7 million in cash on its books.

    The company has been slashing costs and booked a restructuring charge of $518,000 in its most recent quarter.

    Convera's stock closed yesterday at $4.79 a share on the Nasdaq Stock Market, up 11 cents.

    The stock has traded as high as $5.72 and as low as $2.16 over the past year.

    Convera got its start as a small research and development firm named Excalibur in 1980 and developed software for identifying patterns among computer data.

    In 1994, the company bought another technology firm named Conquest that had created software to do word searches on databases used by the intelligence community.

    The acquisition gave the combined company greater access to government customers.

    Nevertheless, Convera has struggled financially in part because the flow of revenue has been erratic, Condo said.

    Some quarters showed major surges from sales tied to new government contracts while other periods showed steep drops.

    For example, Convera's recent decline in third-quarter revenue was mostly because of a comparison with a successful quarter last year, when it won a $3.4 million federal software contract.

    "The government business has its ups and downs but continues to grow," Condo said.

    "You will see us focusing more and more on that segment."

    The company is also seeking to profit by building on its core strengths.

    Convera is developing software that would allow military and intelligence agencies to search the public Internet in a way that would cloak their activities from potential eavesdroppers.

    The Pentagon has set aside funds for the program, and Convera is busily indexing Internet pages in hopes of snaring that money.

    In addition, Convera plans to make its Internet search engine available to regular computer users for free sometime next year.

    In that business segment, Convera would seek to profit through the sale of online advertising, which is growing.

    Convera's search results, based on proprietary technology, would be different from those provided by Google and Yahoo, Condo said.

    "We have applied technology we built for the intelligence community to an advanced development project to index the Web," Condo said.

December 8, 2004 at 01:01 PM | Permalink


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