Expanding Hooks Into ECM

Enterprise content management, or ECM, is perhaps the hottest thing in software these days. It's the answer to the nightmare all end users face in finding the proverbial needle--files, e-mail, documents--in a haystack of stored data and network infrastructure.

ECM, known as document management until content from the Web and other media was added to the mix, has been around for more than a decade but historically had carved a niche only in company departments and vertical applications. Now ECM is going mainstream, thanks to some of the biggest names in software--IBM, Microsoft and Oracle, for example. They've made managing files a priority.

Overall sales of ECM software alone are forecast to hit $3.6 billion this year, up 12.5 percent over last year's $3.2 billion. In the next four years, that number will climb to nearly $6 billion, according to market-research firm IDC.

"That's significantly faster growth than the software business as a whole," says IDC analyst Melissa Webster.

VARs with ECM practices say they're seeing healthy growth as well. "We had 30 percent growth this year, and we expect to see the same next year," says Kara Cleaver, president of Daybreak ICS, which has a large ECM services practice, as well as its own document-capture application centered on EMC's Documentum line.

The rapid adoption of Microsoft's SharePoint Portal Server, in particular, is bringing ECM into the mainstream. The new release of SharePoint Server 2007 next year is expected to have many ECM features, such as the ability to centrally control, store and manage access to documents throughout the enterprise. It will support detailed access control and policy management, while allowing organizations to control workflow and set retention policies via Microsoft Office or any Web browser.

Already, SharePoint is rapidly gaining traction because of its ability to let workers personalize views of their files, enterprise data and external information. "The number of SharePoint portals has been exploding out there," Webster says. "It's kind of viral."

Several ECM vendors could ride on Microsoft's SharePoint coattails or get swamped by the software giant.

Those with the most to gain or lose are EMC Documentum, Interwoven, Open Text, Stellent and Vignette. And then there's Oracle, which is now in the process of rolling out its Content Database, a Web-based document- and file-management platform that uses the Oracle 10g repository and the Oracle Records Database to manage the lifecycle of documents for organizations with retention policies.

Hewlett-Packard, which has been quiet in the ECM segment up until now, could become a contender if it picks up one of the remaining independent ECM vendors.

NEXT: What customers want.

Customers are demanding that ECM suppliers and their partners make it easier for customers to integrate with SharePoint, which has led to some interesting partnerships. The most eye-opening among them may be the EMC-Microsoft alliance. The companies have agreed to provide integration between EMC's Documentum platform and Microsoft's SharePoint and the rest of the Microsoft back-office suite.

"Our goal is to get more people in the enterprise participating in content management," says John McCormick, vice president of product management at EMC's content-management software division. Providing tight integration with SharePoint and other Microsoft software is one way to do that, McCormick says.

"This allows us to expand the footprint of ECM collectively as more and more people have to deal with increasing documents and increasing regulatory issues," says Rob Bernard, general manager of Microsoft's global ISV group.

Make no mistake, however, that the two companies and their partners will still be competing--if perhaps less overtly.

What's important to note, too, is that some EMC rivals in this space already offer SharePoint integration. Take IBM, with FileNet, which it picked up last month for $1.6 billion.

John Prial, vice president of content management at IBM, agrees that SharePoint integration is critical but says it's just one component of overall content management. "It will not at all encroach on the content-centric BPM [business-process management] part, or the archiving and retention part," he says. "FileNet brings a richer content-centric BPM portfolio of tools and third-party applications," Prial adds.

Meanwhile, EMC's integration with Microsoft means that customers will not only have views of the Documentum repository from the SharePoint portal but also will see data in SQL Server, Exchange and other Microsoft applications.

But will that tighter integration mean less opportunity for solution-provider services?

Both Microsoft and EMC insist that won't be the case. In fact, they say partners can offer customers more value-add because they won't be addressing mundane plumbing issues. "We've taken a key piece of integration work and standardized it," Bernard says. "The number of engagements should increase because the overall market will grow."

Daybreak's Cleaver says she's hopeful that's the case. "As consultants, we regularly get asked if Documentum integrates with SharePoint. As many times as we say no, which we've had to until now, we stand to lose the engagement opportunity, or, at the very least, there's another objection to overcome," she says. "Now that we can say yes, we're still strongly in the game each time."

Cleaver isn't blind to the reality that the two platforms will be competitive and to Microsoft's history of burying its partners. "It will be interesting to see how Microsoft and EMC relate going forward--whether they continue to develop competing solutions or develop a stronger partnership," Cleaver says. "I wouldn't want to try to predict that one."