By Jim Lundy
Hot off the heels of Dell Technologies officially buying EMC (September 7th), this week OpenText announced it was buying the Enterprise Content Division of Dell Technologies, formerly known as Documentum. While Aragon will be publishing a full First Take on this event, this blog is about the winners and losers in this deal.
OpenText – Winner
OpenText can claim the ultimate victory by effectively buying their arch rival and nemesis. OpenText Chairman Tom Jenkins has fulfilled his goal of being the main acquirer in ECM. Many years ago, Tom told me that his goal was to do roll-ups in ECM, just like Oracle does in Enterprise Software. Tom has fulfilled that goal. Next to Microsoft SharePoint, OpenText is now the largest ECM provider in the world.
Dell Technologies – Loser
While Aragon feels that Content Management is still vital to any enterprise, the reality is that the ECM sector in Content Management has been faced with market saturation and slower growth than other CM sectors, such as Mobile Content Management. The ECD Division did have Syncplicity, but they sold it in 2015. Suffice to say, today, Dell Technologies today is no longer an ECM provider. They do compete in Mobile Content Management (VMware Workspace One), but by selling the ECD division, they give up a massive base of customers, many of which are still actively buying storage.
Box and IBM – Winners
It is hard to talk about Box today without mentioning IBM. Two weeks ago Box and IBM announced a new product Box Relay that is being jointly developed and will be jointly sold. IBM is smart—they are leveraging the growth of Box and providing Box with Cloud Infrastructure that their Customers are demanding.
Box has been focused on the fast growth part of Content Management—what we refer to as Mobile Content Management. Their growth cannot be ignored. With Revenues approaching $100 Million per quarter, they are on a pace in the next two years to be larger than the ECD division that OpenText just bought. Box allows people to manage the ad hoc content that people create everyday and now they are chasing the harder content applications that start to position them more as a competitor in ECM. The focus on Ad Hoc Content has allowed them to become the replacement for Microsoft OneDrive, which still is not being received well in the market by end users.
Microsoft SharePoint – Winner
If the sale of Documentum to OpenText does anything, it will allow Microsoft to make the case for more SharePoint. SharePoint is already in a majority of large enterprises. Even though OneDrive has not been as popular, the 2016 release of SharePoint is Mobile enabled and supports Hybrid Cloud. That was one of the things holding SharePoint back. With Jeff Teper firmly in control, SharePoint looks to make a comeback in 2017 and the sale of EMC ECD (Documentum) to OpenText gives Microsoft more things to talk about.
We expect more consolidation in ECM as the market shifts to Mobile Content Management. For many ECM Providers, the smart move may be to buy an existing MCM provider. Developing…