Is it Content Management or Storage?

Alan Pelz-Share, of CMS Watch, points out that EMC’s is still about storage and Brice Dunwoodie, of CMS Wire, shows that EMC is moving to storage intensive CM, and seeing their thoughts validated after attending EMC World I’m disappointed.  When EMC bought Documentum, I had hoped that they had seen the future and were focused on the value add that content management brought to their platform.  It’s obvious that they had not.

Deploying Content Management
I remember the days when the first thing we did at a new deployment was to calculate disk space, but this went away and it made sense.  When I see a 1 terabyte External eSATA hard drive at BestBuy for $250 it shows storage is cheap.  But in enterprise storage that same terabyte is $25,000 or 100 times the costs.  Sure there’s some value add but seriously is it worth the additional $24,750? 

But this is a capitalist market and if an IT Manager wants to spend $25,000 of his company’s money for a disk that he would spend $250 at home, that’s between him and his boss.  If IT doesn’t realize that a company is being a “pack rat” with their data and simply needs to add more storage units, who are they to change.  It’s not IT’s job to optimize technology within a company, is it?

Databases and the operating system are part of the infrastructure within a company and so is storage.  The business really doesn’t care what’s underneath the covers of their software any more than they care about what kind of plumbing is in the bathrooms.  All they want to make sure they can get their job done least amount of interruption.  Yes storage is important but it’s a commodity.  But let’s ignore the problem inside the company for now.  Storage is also a commodity on a margin.

The Business of Managing Content
At the vendor, excluding the costs of sales and marketing, the margin on CM software and storage hardware are very different.  Intellectual property is the major cost of software and, once code development is complete, it’s a sunk cost that is spread across each license sale.  Each additional license costs nothing, so the more you sell the better the margin. 

Storage on the other hand has individual unit costs.  The iron that goes into building each box eats away at the unit’s margin and there is a sunk cost with every unit.  And because of this hardware sales has something that software sales (typically) doesn’t, inventory.  This means that you start a hardware deal at a disadvantage.

So why would a vendor that has the ability to create value from the intangible world of zero’s and one’s choose to focus on the tangible world of iron?  Once such way, that I had hoped to see after the merger, was for EMC to develop a content management appliance.  While this would not have brought business value, this would have taken advantage of the strengths both companies have and could have changed the way content management is done.

Managing Content of the Business
The other approach is actually to focus on content management and recognize the problem business’ need to solve.  What documentation do I need to support my business?  What documentation do I need to keep to ensure compliance?  How long should I keep my documentation?  These are questions that define how a business survives.

Only then do you really know how much content is in an organization.  Without knowing what and why, how can IT look  control content?  Where to put the content is an after thought not the business driver.  You don’t rent a storage unit and then fill it with “stuff”.  You figure out the stuff you need to keep and then find a place to put it.

Content management platforms have stayed in the same place since inception, focusing on chaos around content in an organization.  Content management should be used to solve business problems not an IT issues.

3 thoughts on “Is it Content Management or Storage?

  1. When is comes to storage – the best analogy I can come up with is real estate. The guy that sells you the land really could not care less what you do with it so long as the check clears. If you want to build a duplex or a million dollar mansion – it doesn’t matter. Location does – and he’ll charge you more for it. The storage equivalent is speed or management features but even if its a gated community – the agent just wants his $$.

    EMC makes land. They make oceans of money selling it. You’ll never make then care what its used for. They don’t have to know to sell land. Documentum at the end of the day is manufactured housing. REALLY expensive housing, but just an app that gives people a reason to buy storage.

    The thing that surprises me most is that people actually expected different behavior. Are we all that naive?

    Rather than looking for visionaries in keynotes to inspire us – maybe we should focus on educating the customer and realize that we have to sell our product (and ourselves) differently to the operational infrastructure people that own the real EMC relationship in most companies.

    Application teams are slowly loosing contacts with EMC as the hardware side covers more of the relationship. The people that know the core reps by name now are getting peppered with software pitches. These people care about different things, but at the end of the day – the same customers are at the other end of the phone screaming at them. Frustrated Nancy in accounting that can’t find her invoice. Same problem, same solution – different path to deliver it.

  2. Really great analogy. I wonder if real estate agents had really cared, about what they land they were selling was being used for and who they were selling it to, would we’d have these current headaches in the real estate market. It simple to see that when someone in control of a market need provides it without any real knowledge or respect for their customers it doesn’t bode well for the ecosystem.

    I don’t think we’re naive. We just simply expect real estate agents and lender, oil executives, and software executives to understand what we really need and work in our best interest. Oh right, that is naive.

    It’s true that folks are losing contacts with EMC as it becomes all about the hardware. It’s just a fortunate situation that IBM, Open Text, Oracle, Microsoft, Alfresco, and Hyland still understand it’s about the business need. And at the end of the day, most content management systems are generally the same.

    So instead of having an entire segment collapse we’ll just have one company suffering through the months ahead. That is until they see the light.

  3. On one hand i fully agree with you, i have the same impression. On another hand, I am fortunate to work in ECM world with some other vendors also and i just came back from IBM’s conference on Information Technology.
    I must say I saw vision there. I saw something totally different than the EMC speech, so i think they have a fair chance to stand out from the pack in the near future, since they are talking about the light. IBM could start meeting part of the “naive” customer expectation of one stop shop for information management.

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