IBM shapes up for document fray

Big Blue puts itself on a collision course with content management rivals by preparing to flex its muscles in the growing market for document-tracking software.

IBM is preparing an aggressive push into content management software, a move that could spur competition and accelerate consolidation in the expanding niche.

Big Blue plans to boost research and development spending on content management software--used to keep tabs on the mountain of documents created by businesses--by 25 percent in the coming year, said Brian MacIntyre, vice president of content management and information integration at IBM. It will also shift 2,000 data management salespeople to content management, he said.

By revving up sales of its Content Manager product, IBM hopes to drive revenue from related underlying software products. These include its DB2 relational database for storing information and its WebSphere Portal software for presenting content via a Web browser, company representatives said.

IBM's designs on the content management market will place it in the thick of several companies on a collision course over competing document management, imaging and Web content management software, said Andrew Warzecha, an analyst at the Meta Group. A number of software providers are readying "enterprise content management" products--suites of applications that address a broad range of needs for managing unstructured data such as documents, media files and Web pages.

"The dilemma for customers is that you have roughly 100-plus vendors coming in from different spaces, and they're all building out their capabilities and competing," Warzecha said. "While the market is growing rapidly, we expect to see a lot of consolidation, because so many companies are targeting similar things."

Content management systems are used to create, store and distribute documents within corporations and on their public Web sites. Corporate interest in content management systems and in corporate portals, which present information in a Web browser, is growing as businesses try to improve their management of an ever-growing number of business documents, Web pages, images and media files. A yet-to-be-released Forrester Research survey will show that 35 percent of U.S. companies plan to invest in content management this year, said Nicholas Wilkoff, an analyst at the research firm.

IBM's Content Manager software is an extension to its DB2 database for storing and managing unstructured data. But as IBM fills out its content management product line, it will likely butt heads with several content and document management companies--many of which it now has partnerships with, said analysts.

"We fully expect over the next 12 months (for) IBM to be competing in the document management space with WebSphere," its own application server product currently used for software development and deployment, said Meta Group's Warzecha. "We're going to see IBM do more than dealing with (information) repositories."

With this year's planned changes to Content Manager, IBM intends to take on content management companies such as Documentum and FileNet head-on, said Big Blue's MacIntyre. The company will bolster the product with electronic records management, digital rights management and industry-specific tools, he said.

Opportunities knock for portals
The tech giant also sees portal software as a fertile area to grow its content management business, said Larry Bowden, IBM's vice president of portal solutions. Last year, it integrated its WebSphere Portal software with Content Manager, allowing people to publish Web pages within IBM's portal. The company will continue to build on the Web content management features in its portal product, Bowden said.

IBM partners with software companies Interwoven and Vignette for tools to build and publish Web content. Big Blue currently focuses on the data management underpinnings--through DB2--of content management applications, said MacIntyre.

But IBM's decision to link WebSphere Portal and Content Manager hint at bigger ambitions in Web content management, said Forrester's Wilkoff.

"In the long run, Interwoven and Vignette should be worried as well. It makes sense for IBM to enter Web content management, and when that happens, they become a serious threat," he said.

IBM will also run up against competitors Oracle and Microsoft in the content management business, analysts said. Oracle's 9i database can handle unstructured documents, and Microsoft's forthcoming Yukon database will also add unstructured data management capabilities based on XML (Extensible Markup Language).

This rush in interest among information technology companies reflects the growing demand for content management systems and portals. The number of business documents, such as spreadsheets and purchase orders, continues to expand rapidly. Corporations are also reacting to new regulations, such as the Sarbanes Oxley Act, which require that companies retain records and be able to produce documents for any legal review.

IBM's content management business grew by 26 percent last year, MacIntyre said. It currently has 9,000 customers for Content Manager.

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