Oracle’s ECM Vertical Acquisitions

Oracle announce the acquisition of Skywire last week and it highlights the difference between the growth and acquisition strategies of the different players. For those unfamiliar with it, Skywire boasts of having 1450 insurance customers. Clearly a CEVA acquisition. The pattern is not exclusive but this acquisition is not unlike Peoplesoft, Siebel or other major function acquisitions where they acquired strong players in a vertical built on their technology. Contrast this with EMC acquistions over the last twelve months in the CM space. Document Sciences and X-Hive are both clearly platform buys. So why does Oracle go after vertical applications instead of platforms? They do it because they can.

It’s hard to find a decent enterprise business application written in the last ten years that doesn’t run on something owned by Oracle. The same cannot be said for EMC/Documentum and vertical content oriented enterprise applications. The list is extremely sparse. To be fair – either by default or design, none of the major ECM players have done a good job at making their applications the backbone of major COTS offerings.

The balance of EMC’s catalog is heavily weighted to commodity storage. There is little practical difference between an application running on EMC versus IBM storage. So, they either invest heavily themselves or continue rounding out the application platform and encourage CEVA developments from ISV’s. The risk shifts to the ISV when they commit to a CMS. For Oracle’s acquisitions, they may not have been built on UCM but there is nevertheless an affinity with other products in the catalog.

HP’s Tower acquisition is an indicator that it is in a similar position as EMC but they don’t have the baggage associated with a major ECM product so they started with records management. Oracle’s position is not unique though. There is one other player with similar cross-over potential from business apps to true CEVA offerings. Microsoft.

2 thoughts on “Oracle’s ECM Vertical Acquisitions

  1. I’m not sure I would call Skywire a CEVA acquisition. It seems more to be a Siebel play that happens to have content management. That means that Oracle will still need to figure out how to integrate Skywire’s content management components in theirs.

    But the real point I like is why Oracle can do this, I’d say why no one else can. If you look at how Oracle dominated the market it was by creating an open standard ODMA. They pushed the standard and made every other vendor look like a fool if they didn’t get on board. Oracle knew their product was the best and made sure that it was easy for anyone to develop solutions on their platform or anyone else’s by making relational database development a standardized approach. Basically leveling the playing field.

    So as a VAR spent time trying to work with competing vendor, Oracle would push to make sure they were following standards. Then once the VAR realized that Oracle was better it was an easy transition to the platform as a standard had been followed.

    No one in the ECM space is willing to do this because they don’t believe in their own products. They’re too afraid that customers and VARs will want to change over that they make their platforms incredibly complex to make sure that migration costs are extremely high. “I know we have problems but are you sure you want to spend x millions to go to Vendor B?”

    Standards in the ECM field seem to last only a few years. That’s not something you build your product’s future on.

  2. Interesting idea – that the reason for the complexity is to discourage defections to other products. Kind of like holding their customers for ransom. More than one commentator though has referred to Oracle’s pricing model as highway robbery.So maybe this is a case of choosing which crime you want to be a victim of, kidnapping or robbery.

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