Setting the records straight

Over the past few years, meeting compliance and ensuring that important corporate information and content is well managed have been the biggest drivers behind growth in the ECM arena. Although these are still crucial drivers, another that is gaining in prominence is the shift towards digitalization and being able to work more economically and efficiently in a compliance-driven, digitized environment. According to Mukul Krishna, an industry analyst with Frost & Sullivan, most of a corporation’s intellectual property – including spreadsheets, presentations, images, videos, training and marketing communications – needs to be better organized. “Most of this content is languishing in little silos all over corporations and is at risk from being lost or misplaced. It needs to be put into a central repository that is easily searchable and can be easily accessed by those who have the right authority. The result will be a one-stop repository that can be accessed anywhere in the globe at anytime.”

Despite the increasing popularity of ECM, growth in the sector has been disappointing and has not reached its anticipated level this year. Consequently, revenue is much lower than expected. This shortfall is due to a number of factors, the biggest being that not all those who claim to be ECM players actually are. In fact, there is still much confusion when it comes to defining ECM. “Most of the ECM players, until recently, have lacked a critical component,” says Krishna. “Web content management companies have traditionally been calling themselves ECM companies. However, unless a core additional asset management solution is well integrated with the entire suite then this does not constitute true ECM. It is essential, therefore, to have every single component in place. Unfortunately, many vendors have only been delivering ECM through third-party integration; even after making acquisitions, getting the necessary solutions and looking in-house, it was obvious that this integration was not that great. The key part of content management is having a really searchable archive or repository for your content, which can be repurposed across multiple platforms. Unfortunately, this area has been falling short.”

The good news is that the vendor community has started addressing these issues and gradually a better understanding of ECM is emerging.

One of the main developments is the number of acquisitions that have been taking place. For example, EMC have bought Documentum, Open Text has bought Artesia whilst Interwoven has acquired MediaBin. Krishna predicts this trend will continue. “We expect to see a continuation of hectic mergers and acquisitions,” he says. “Due to the popularity of ECM we are likely to hear more from the tier two and tier three vendors rather than simply those from tier one. We will see much more creativity from these companies. Even though they might not have the entire solution base, they will be able to achieve a good deal by creating interesting partnerships and through collaborative bids. There are platforms out there that allow third-party systems to integrate together and provide ECM solutions. They provide the necessary infrastructure for all the various components needed for ECM to tie in together on one single platform.”

Krishna also expects a surge in competition and an increase in vertical specialization. “It is probably going to be a little saturated at the top-end,” he predicts, “although, the lower end of the market is likely to become fragmented as vendors compete with one another in an attempt to deliver the most innovative solutions. Different vertical areas will also develop that will need their own unique requirements fulfilled. So, for example, one vendor might specialize in the content for the life sciences market while another might deal with pharmaceutical. There will therefore be a need for a great deal of customization.”

As bigger vendors such as IBM begin to dominate the market, some advice Krishna would give smaller vendors is to ensure they “have a good, strong, robust spatial asset management solution at their core”. He expects that surviving and succeeding in the market will be a struggle for smaller vendors unless they have a unique solution along with some good financial backing. “Without these, it is likely to be difficult for them to penetrate the market as smaller vendors cannot compete with the marketing capability that the more established, bigger vendors have. The best option for those with the most interesting new technology is to get acquired by one of these bigger companies, who will be very keen to get their hands on new ideas and solutions.”