It's been an interesting few years for ECM vendors around the globe, with numerous acquisitions and mergers taking place. We are seeing a great deal of consolidation in the market and this is surely only providing benefits to our customers - or is it?
The requirement for an organisation to store and manage structured (DB), unstructured (docs etc.) and semi-structured (xml) increases on a daily basis. Current estimates state that around 84% of information lives outside of the database - and this drives interest within an organisation like Oracle to get their ECM pitch right (which, incidentally, we have done).
John Batelle once wrote that "every day, we create and store more information (in the digital format) than has been stored for most of human history on paper". John was quoted in his book "the Search, How Google and its Rivals Rewrote the Rules of Business and Our Culture" - it is an interesting fact that electronic information is having such an impact on our lives and the IT industry as a whole. Historically, IT was more interested in providing the applications for the end-users - NOW, IT is more interested in working out how to store and manage all the information coming from these applications, and from a wide-diversity of other sources.
I presented a road-show around APAC during the middle-latter part of 2007 during which I spoke about changes I had experienced in my career. The topic that generated the most interest concerned the cost models of storing information in the mid-80's to today. Historically, storing paper in a warehouse was cheap whilst storing information digitally was expensive. I worked for the biggest consumer of on-line storage outside of government and IBM in the UK and we had the grand total of 128Mb of online available storage - held on drives that resembled a top-loading washing machine. I have more storage and computing power on my Blackberry in 2008!
Today, of course, on-line storage is dirt-cheap (one reason why EMC, IBM, HDS etc. are looking to add value through software acquisition and development) whilst warehousing paper is incredibly expensive and frowned upon by the tree-huggers. The costs involved in managing paper (retention, disposition etc.) are staggering and with the rise in demand for storage - only going to get higher and higher.
An interesting statistic, driven out of a published report sponsored by EMC is that by 2010, the demand for storage will outstrip availability/manufacturing at today's levels. This means that unless information management is addressed through intelligent systems such as ECM - manufacturing is going to have to step-up meaning a further drain on the world's resources. Storing information more intelligently means a reducing in duplication of information, appropriate retention and disposition based upon the information's lifecycle, virtualisation resulting in fewer physical servers using less air-con and power etc. etc. etc. We are a brighter, greener Oracle nowadays - the latest database requires less disk-space, half the power, half the cost and it runs faster with much more capability than ever before.
So what are Paul's predictions for the future.
Well, firstly I believe that ECM as a strategy within a customer's environment will move towards an implementation as a part of the data-centre infrastructure. Customers are looking for a unified content management (UCM) platform that truly allows any content from any source to be stored, protected and leveraged by the larger community. Realistically, as of February 2008, there are only 3 vendors in the marketplace that can truly provide this and Oracle is unique in its approach and software-focussed strategy. Our customers are not getting the hardware (storage and server) pitches that our two main competitors will drive - shifting physical boxes being their primary business.
Secondly, I think that we will see more acquisitions and/or mergers happening during 2008-2009. There are a number of tier-2 players in the ECM space that are ripe for acquisition and there are a number of hardware vendors that might look to expand their footprint within their own customer base through new initiatives around ECM and the intelligence these products bring to the storage or server environments. Tower, Vignette, Interwoven et al. fit firmly into this arena - potential suitors may include HP, Dell or Sun.
Thirdly, Open-Source ECM vendors like Alfresco are starting to gain significant presence in the marketplace. I had the pleasure of working with John Newton and the Alfresco team whilst I was based in the UK with Documentum and the guys really are the nicest people in the world with great vision and execution. This is demonstrated if you ever get the chance to meet the team and/or see the software in action. Organisations remain wary of open-source initiatives but I believe that the next 2 years will tell for product like Alfresco. With all of the consolidation happening in the industry, we here at Oracle welcome new and upcoming competition - particulary when driven by industry legends such as John and his team.
Finally, everybody has to consider the big M. Microsoft are making inroads into the ECM space through Sharepoint and other similar products in their line-up. It's interesting to still hear customers talk about Sharepoint enthusiastically - only to bow out of conversations when you raise ECM functionality outside of document collaboration. I am sure that M is working hard on developing their products to become truly competitive, tier-2 and 3 ECM vendors will suffer first and we may see some disappear. I am pretty sure that M will join us as a tier-1 vendor in the next couple of years - assuming their developers and product managers don't get moved onto the next big thing before then (what ever happened to Microsoft's HRMS, ERP and CRM initiatives anyhow?)
Roll-on 2010
Paul
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