This year, the content management market figures to be worth as much as $10 billion. And far from software that helps simplify Web site updates, content management has come to include applications for back-office information management, collaboration, records management, and the management of digital assets.
A confluence of events in 2003 brought content management a great deal of attention. The applications continued to evolve and add functionality. The adoption of Web services and XML, which make handling content more efficient, continued. New rules and federal regulations requiring content handling and storage of documents made content management applications critical to many organizations. And long-awaited consolidation began in earnest, not only among companies within the content management market, but with more traditional software heavyweights as well.
Whether or not adding all of these features will be a wise move in the long run remains to be seen; most organizations already have tools for content creation (such as Microsoft Office) and collaboration (such as instant messaging). Nevertheless, the trend in content management heading into 2004 is to provide a lot of functionality in one box.
Web services and XML
The emergence of Web services and standards such as XML helped lead content management to the forefront of the software market in 2003. By enabling content to be stored in an application-neutral form, content that was once for use only on the Web, for example, can now be re-used, re-formatted and recycled for print materials, internal Word documents and PDFs.
Beyond re-using content within an organization, XML enables organizations to ease integration with suppliers and customers.
Astoria Software in San Mateo, Calif., uses XML in its content management and structured document management applications. Astoria specializes in the highly technical aerospace and defense industries where the re-use of technical content often comes into play. The flight manual for a 747, for example, is longer than the plane itself. The manufacturer, Boeing, provides a dataset that draws on data from all the subcontractors. Each airline then customizes the manual for its fleet. Within a few months, the FAA can make Boeing re-issue the manual to reflect a change.
Using XML, Astoria's products have the component-level management of the structured and unstructured content that make such a scenario a little less of a project.
"It's useful for anything big and complex with multiple revision cycles," said Astoria Software CEO Tom Steding.
But XML is making progress in less technical areas as well. Amherst, N.H.-based Ektron has been at the forefront of using XML in Web content management.
"We really feel strongly that when you are writing content, whether it be for the Web or print, that you should be able to use that content anywhere," said Jeffrey Neumann, Ektron's director of product marketing. "You can really re-use that information not only on that Web site, but anywhere."
Ektron released a new version of its eWebEditPro + XML content editor that enables users without the technical knowledge and understanding of XML to develop the schemas using a simple interface. Microsoft's InfoPath serves a similar purpose in the new Microsoft Office released in 2003. Bringing XML to the masses will only continue its adoption by content management vendors.
The accounting scandals that made headlines the last couple of years were hardly good news if you worked for Enron, but the timing couldn't have been better for the content management industry. Regulations like Sarbanes-Oxley made keeping track of content, whether financial statements or e-mails, the law. Suddenly people paid a lot more attention to content audit trails and version control.
Many content management vendors already had applications or modules for record management, which allowed records to be stored for a set amount of time then deleted. The adoption of laws governing financial statements opened a whole new market for content management, and industry experts say most organizations that need to be in compliance are just beginning to understand the works that lies ahead.
Organizations that need to keep track of their paperwork aren't the only ones that took notice of content management in 2003. More traditional software companies scooped up content management vendors as consolidation in the crowded sector got underway. The biggest news of 2003 was EMC's purchase of Documentum, one of the biggest names in storage buying perhaps the biggest in content management. Documentum figures to be part of what EMC calls "information lifecycle management."
There was also plenty of consolidation among the smaller players, many of which scooped up niche players to complement their offerings. Open Text acquired Web content management player Gauss Interprise and IXOS, which specialized in content management and archiving. Interwoven added collaboration and workflow features with its purchase of iManage.
Most analysts expect the consolidation to continue in 2004. Even as the major players in the market continue to bring together the disparate parts of an enterprise content management system, they too recognize that not everyone will survive. When announcing his company's IXOS acquisition, Open Text CEO Tom Jenkins, a major buyer in the past year, said he expects the ranks of content management vendors to boil down to two or three leaders worth $2 billion to $3 billion each.
Jenkins' prediction may come to fruition, but there are a number of wild cards that could influence the future of the content management market. Open-source content management applications have gained a loyal following for inexpensive, quick implementations for specific projects and for intranets. If nothing else, the open source offerings could force vendors to componentize their applications, breaking them into separate modules, which some have already done. Open-source apps will also add downward price pressure, especially on the low-end content management offerings.
The evolution of Microsoft's Office package, which in its newest incarnation bundled in the collaboration and document management of SharePoint and XML, also deserves watching. While rarely mentioned in the same circle as the pure-play content management vendors, Microsoft is hard to count out.
Most of those who follow the content management market agree the events of 2003 will play a big role in deciding where the market goes from here. But in some ways that direction is no more clear than it was a year ago.