Dr Michael Lynch,
CEO, Autonomy Corporation,
Cambridge Business Park
Cowley Rd
Cambridge
CB4 0WZ
17th April 2012
Dear Dr. Lynch.
You may recall that I have written to you before expressing concerns about the way in which Blinkx is being managed, and about Chandratillake's abilities and qualities as a CEO. I feel that the events of the past 6 months have confirmed my doubts, and have brought matters - and Blinkx itself - to a crisis point.
I appreciate that you have mentored Chandratillake for many years, but you must surely recognise by now that he simply doesn't have what it takes to be an effective CEO. His inability to clearly convey exactly what Blinkx’s business model is (I’ve held shares in Blinkx for 5 years, and even I’m confused: video search engine or long-tail ad network; or both?); his inability to convincingly answer straight questions about Burst on the analyst's call last November - instead dodging two direct questions and only succeeding in sounding uncertain, shifty and evasive; the failure to deliver products or follow through on deals once hyped as The Next Big Thing (Transaction Hijacking, Cheep, Pinball, blinkxbrasil, Blinkx Music, Woomi, Miniweb, Samsung); and the endless paranoid secrecy which as time goes on seems to me more and more a cover to hide the level of Chandratillake's failure in managing this company.
Chandratillake has screwed up twice in the past six months: once on that analyst's call, when he dodged what I thought were very simple and obvious questions about Burst which he should have been expecting and have been prepared for but clearly neither were true - and the share price collapsed by two-thirds in the subsequent ten trading days; and again with the RNS the day after Easter Bank Holiday Monday, when Chandratillake demonstrated that he was unable to deliver the FY figure of $124m with which he had said he was 'comfortable' on that November call. As I write the share price is now back below the level at which it floated nearly 5 years ago - a damning indictment of Chandratillake's mismanagement of this company and his squandering of the business opportunity of a generation. He has screwed up twice: as a shareholder (which he is not) I don't want to see him given an opportunity to do it a third time. In the eyes of many shareholders - myself not least - Chandratillake had precious little credibility left after his piss-poor performance on the call in November and the resulting share price drop - what credibility he had left was, for me, utterly blown away with last Tuesday's RNS. The man needs to be removed, now.
In my opinion Chandratillake is a total disgrace. Someone who talks the talk but cannot walk the walk, and does not - I believe I am correct in saying - own a single share in the company of which he is CEO. He has had 5 years to manage the company his way and look where we are - a share price below what it floated at 5 years ago, a core video search business that appears to have stopped growing completely, a long -tail network that is either failing to deliver what was hoped for it and/or is taking longer - and costing more - to integrate than was anticipated, and failure to hit his own targets, which he blames on general market conditions (funny that Apple – which just hit the $600bn market cap milestone - Amazon, Facebook and Google don't seem to be suffering from weak markets - but then they truly are world-class companies with management to match. Nor do I notice WPP identifying any general weakness in online advertising). To my mind that sounds like finding excuses for his own failure, in my opinion another sign of his immaturity. The plan seems to have been to buy growth (in the form of Burst) and he can't even manage that. How can the core Blinkx video search business NOT be growing organically when video is exploding across every channel? Blinkx is in the sweet spot of one of the hottest business sectors on the planet and Chandratillake is - if you'll forgive my language - fucking it up, BIG TIME!!!
I'm afraid I am not prepared to stand by any longer and watch someone I consider a rank incompetent destroy what is left of the value of my holding in Blinkx. I intend to obtain the Blinkx shareholder's register and to start writing to shareholders, starting with the largest and working down, asking them if they are happy with Chandratillake's performance , and if they are not - and I suspect that most of them are not - to vote against his re-election at the first opportunity, or alternatively to call an EGM to remove him.
It's time for a grown-up to run Blinkx. I hear Carol Bartz and Eric Schmidt are looking for new roles: the company needs someone of that stature to take it forward to where it should be - not the failure currently in charge.
Yours sincerely,
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