“Strange days have found us, Strange days have tracked us down” – The Doors
I have been competing with OpenText using Documentum for quite a long time. Now with the sale of ECD by Dell/EMC those days will soon come to an end and a new era in ECM begins. Strange days indeed. A lot of thoughts come to mind along with some trepidation but on the whole the deal will end up being a benefit for the only people that really matter. The customers.
The most basic mistake made when thinking about this deal is to equate the Enterprise Content Division(ECD) with Documentum. Not just the brand but Content Server itself. It is understandable and most don’t even realize they are doing it. There is so much more to the Documentum brand than the server.
The Enterprise Content Division is a well-rounded portfolio with little internal overlap and good messaging through the information lifecycle. Capture(Captiva), Manage(Content Server+D2), Process(Content Server + xCP), Deliver(xPression and Archive(Infoarchive). Loosely coupled brands and products, each either now or at some point in the recent past a best in class player. A growing and evolving collection that is changing focus with Infoarchive which breathed new life and optimism into the ecosystem and LEAP casting a vision for where the division wants to go and meet the future.
Acquisitions played some part in this collection but they were never really about dominating the market. The objective of those purchases was always to fill gaps and then leverage the core technology, often to the detriment of individual solutions. It was about solving a problem “the right way,” with “right” having been defined twenty-five years ago as open API, multi-platform and engineering driven. Despite this foundation, past leadership ignored the ECM DNA for a time, finally coming back into alignment with the realities of the market when Rohit Ghai took the reigns.
Contrast that to the OpenText cavalcade of acquisitions. This is a company that never let overlap get in the way of a good deal that increased earnings and market share. OpenText studies the market and makes a decision to acquire it. It is a different mindset altogether. OpenText is actively innovating beyond ECM in analytics and other broader EIM subjects. Historically though, OpenText while not averse to internal innovation clearly has displayed a tendency to gather rather than cultivate.
One company was driven by a legacy of architectural ideology and the other on building shareholder value and expanding into tangential information management to gain market dominance. In the changing business climate, this round of consolidation was inevitable as was this outcome. Especially when the aforementioned ideology was at times too rigid to move fast enough and at other times ignored outright in pursuit of objectives that ran counter to the market.
Which was right?
It might seem obvious now but there is a better question to ask.
The customer doesn’t.
They want their problem solved. How we get there is immaterial.
OpenText is not writing a check for $1.6 billion dollars for content server. It is buying ECD. LEAP, Captiva, xPression, AX, xDB, xPlore and Infoarchive which to me has more immediate cross sell potential than any other given the SAP relationship. And yes content server. Oh yes, with all the maintenance revenue that comes with it. In case you forget – this is a business. Content server is not going to simply evaporate. Despite all the click bait and alarmist rhetoric it will continue to serve the business needs through industry solutions just like OpenText’s equivalent for many years.
I have read many things this week written by friends in the ECM world, some lamenting, some celebrating the decline of the first generation of ECM vendors. Interesting inside drama, which I’m not above participating in, but as I look at the landscape, talk to partners and customers, and look for new problems to solve I don’t want to waste any more time than necessary emotionally processing the change. With the combined portfolio, customers have access to a broader range of potential solutions to their challenges in the enterprise information management space from a single source. This has real benefits for customers. It simplifies acquisition of commoditized capability and concentrates differentiation against the real competition. New business and delivery models.
I keep hearing the term steward related to who will manage the Documentum legacy but wasn’t EMC always just that? An overseer of the ECD business happy to leverage the revenue but never committed to the idea of market dominance in ECM. To be frank, the numbers by comparison were and always will be too small when compared to storage to change that attitude. ECD and all that goes with it didn’t need a steward. It needed a champion.
OpenText is not a steward of this business. It is an aggressive competitor committed to winning not just the deal but the day. Despite concerns over what might and might not get investment in the future I believe that the vision is more important than the logo. The customers will, in the end, be better served with the focus on the problem space that comes from a company dedicated to the market.
Lastly, I’ve been considering like anyone else would what this means to me personally. OpenText is a Canadian company and I know there will be adjustments. 1) I need to add the superfluous eh to the end of sentences and 2) I need to remember Canadians don’t think #1 is funny. They also have bacon all wrong but they gave us William Shatner, Shania Twain and Jim Carey so they get a pass on that. (no excuses for letting Celine Dion happen though)
No matter what, the toolbox has been reorganized and expanded and the work will go on.
Very well conceptualized Lee. Somehow I feel that this merger can amalgamate the missing link between Web Content Management (with products like OpenText Experience Suite 16 and Experience Cloud 16) and Enterprise Content Management (Documentum and InfoArchive). Licensing can be an important consideration though in the aforesaid case. In fact a lot of people will be waiting for that, it is now up-to Open Text to utilize it and tie the complete story for a full-fledged CMS to support the Digital disruption for external audience or customers, partners and internal audience.
Also we need to portrait InfoArchive with Application Portfolio Optimization/Rationalization so that customers can extract the maximum value form the product.
Looking forward to hear more from you in the near future. Thanks a lot.