VP of Strategy, LLC vpofstrategy.com Enterprise Content Management (ECM) Overview

Enterprise Content Management (ECM) refers to the various strategies, technologies and processes for managing digital information in the enterprise, in any medium, from conception through deployment. Thatʼs a VP of Strategy, LLC definition for ECM. And like a lot of ECM definitions out there (AIIM, Wikipedia, etc.) it leaves some room for interpretation — particularly when it comes to defining which technologies are (and are not) officially included under the ECM umbrella. In fact, the more sources you consult on the matter, the more variations on that definition youʼll find depending on the context, which understandably can lead to some confusion when settling on a universal definition for ECM. For example, a lot of the focus on ECM at the upcoming NAB Show (Las Vegas, April 9 – 14, 2011), the worldʼs largest entertainment media conference, will be in the context of managing creative media assets in a production environment. However, what is not debatable about ECM is that it is an industry going through a period of both rapid growth and transformation, and those are good things. There is also a lot of acquisition activity, and plenty of VC interest in the space. So, while there is not quite an “industry identity crisis”, a certain amount of “industry confusion” is understandable, particularly for those new to the field. Real Story Groupʼs Alan Pelz-Sharp speaks as fluently on the evolving nature of ECM from an industry-wide perspective as anyone Iʼve heard recently. Hopefully this paper will provide some clarity as well. Market Size — According to Gartner, the global ECM software market was in double-digit annual growth from 2004 – 2007 and was estimated to be at $3.3 Billion in 2008. It then grew to $3.5 Billion in 2009 (during a recession), and is expected to grow at an annual compound rate of over 10.1% to over $5.7 Billion by 2014. Other analysts (including this one) are even more optimistic about the near future of ECM. There are at least a couple reasons that Gartnerʼs estimates are conservative. First, as I understand it, they do not formerly include the rapid growth of Mobile Content Management Systems (MCMS) in their calculation. I also assume that they do not include revenue far beyond those considered in their annual ECM Magic Quadrant report, such as “light-weight” ECM niche players that are rapidly adding new tools to their solution that were previously available only from the big players. ECM Technology Ecosystem — ECM technology encompasses many components, all of which are pure play sub-markets or silo industries of their own. Itʼs important to note that many organizations do not need all the components represented in the “ECM Technology Ecosystem”, and furthermore, many of these technologies overlap in capabilities. Therefore itʼs important to put together an organizational ECM strategy that covers all technologies the organization will need over the long-term without over-buying. ECM Ecosystem Technologies include: Digital Asset Management (DAM) and itʼs close relative Media Asset Management (MAM), Document Management (DM), Business Process Management (BPM), Web Content Management (WCM), Records Management (RM), Digital Rights Management (DRM), Analytics and Business Intelligence (BI), Enterprise Collaboration (includes Social Media) and the rapidly growing field of Mobile Content Management Systems (MCMS).

Enterprise Content Management (ECM) Overview (continued) DAM + MAM: The Future Center of the ECM Technology Ecosystem — Each of the ECM sub-markets / silo industries are stand-alone technologies in established pure-play industries on their own, however the ECM market as a whole is still evolving and far from maturity. As an organizationʼs ECM deployment grows to encompass more of these silo technologies, particularly when combining technologies from different vendors, questions will arise as to how these independent components should interact. More importantly, maintaining multiple repositories, each with unique security and communication protocols, creates inefficiencies that will need to be addressed. Therefore, architectural strategy becomes increasingly important to facilitating a return on the investment in ECM. (see graphic on previous page) VP of Strategy, LLC proposes that while Digital Asset Management (DAM) and / or Media Asset Management (MAM) are relative newcomers (10 years or so) to the ECM Technology Ecosystem, they are arguably the most “architecturally important” components of the group for a long-term ECM strategy, and the future evolution of the ECM ecosystem. This is a good place to point out that DAM and MAM are basically the same thing – repositories for managing large libraries of digital files (images, documents, rich media, etc.), with powerful proprietary or commercial enterprise imaging engines (Telestream, Equilibrium, Snowbound, ImageMagick, etc.) used to render proxies, edit, and repurpose the images, documents and rich media. However, these technologies have evolved in such a way that in general, DAM solutions tend to be better (more feature rich) on the imaging side, and MAM tends to be better on the rich media / video side. Other than that weʼre talking about the same basic technology. Eventually these categories will merge together along with traditional Document Management (DM), as the single, centralized repository best equipped to be the place where the master digital files for all ECM technologies physically “live”. When putting together an organizational strategy for ECM, itʼs critical to understand that maximum ROI on these technologies and the digital assets themselves will not be achieved unless data is able to seamlessly flow between all of the ECM silo technologies. Rather than taking on the complexity of maintaining multiple repositories, it makes architectural sense to think of the “DAM+MAM” component (and eventually DM) as the “center of the ECM technology universe”, seamlessly tied into all the other ECM technologies. And much of the value of a DAM+MAM system will be in its ability to facilitate the flow of these digital assets back, forth and between the other ECM silo technologies through Cloud and Services-Oriented Architecture technologies (Web Services, XML, SOAP, REST, etc.) DAM+MAM and DM solutions that are built with technologies and architectures that best facilitate this philosophy of “Greater ECM Inter-connectivity” (platform / infrastructure flexibility, API integrations, workflow adaptations, intuitive user interfaces, etc.) will end up dominating this space because they will be best able to unlock and leverage the power of their neighboring ECM silo technologies. 1. Acquisitions and New ECM Competitor Entries — Over the last couple of years major technology players (including those not traditionally in the ECM space) have been making acquisitions of key ECM sub-market silo technology vendors to build out their ECM solution offering. A few interesting examples:

- Facebookʼs $70 Million (+/-) acquisition of Snaptu (MCMS) - OpenText acquisition (undisclosed amount) of WeComm (MCMS) - OpenTextʼs $182 Million acquisition of Metastorm (BPM) - OpenTextʼs $35 Million acquisition of Nstein (DAM) - OpenTextʼs $310 Million acquisition of Vignette (WCM) - Adobeʼs $240 Million acquisition of Day Software (WCM and DAM) - Adobeʼs $1.8 Billion acquisition of Omniture (Enterprise Analytics) - Googleʼs $150 acquisition of Widevine (DRM) - Autonomyʼs $775 Million acquisition of Interwoven - Lexmark $280 Million acquisition of Perceptive Software (DM) - IBMʼs acquisition of Datacap (BPM) - Avidʼs acquisition of Blue Order (MAM) - PaperlinX (ASE: PPX) launch of AXSAAS (DAM)

Enterprise Content Management (ECM) Overview (continued)

2. Social Media — Facebook, Twitter, LinkedIn, and the rest will ensure that Social Media continues to be a disruptive technology in the Enterprise Collaboration space, with effects that spill over into all other ECM silo technologies. Gartner research showed that 31% of enterprises regularly use social media tools and social networking sites, with 52% increasing budgets for social media tools and collaboration software in 2010. Data created through social media can be permanent and will eventually need be archived and accessible like other ECM data. 3. Mobile App Space is on Fire – Buzz at SXSW was all about “Apps” and for good reason. With over 8 billion app download last year, an estimated $30 billion in mobile app revenue by 2015, and new mobile app development shops with VC funding popping up all over the place, the impact of mobile on the ECM industry canʼt be ignored. Check out this article that examines the Mobile App Landscape. 4. Metadata — not always the sexiest topic, yet still critical to the evolution of the EMC. At the recent Creatashere conference in LA a panel of DAM+MAM vendors all spoke about the importance of metadata as ECM solutions evolve, such as metadata becoming uniform so it can flow between products. Check out the article. 5. “Light-weight” ECM Options — Open source, SaaS, Hybrid architectures, and piecemeal solutions built by combining different ECM silo technologies will continue to provide an alternative to the “heavy-weight” (and more expensive) ECM solutions. 6. Industry-Specific Solutions — Vendors are focusing on adding value by bundling functions integrated with industry-specific applications. Has as much to do with marketing strategy as it does the natural evolution of the technology. 7. Microsoft Sharepoint Integration – Vendors for ECM silo technologies are providing value and winning business over competitors by adding Sharepoint plug-ins and more flexible integration.

Gartnerʼs 2010 ECM Magic Quadrant – Each year Gartner comes out with its ECM Magic Quadrant, which represents a snapshot of the ECM Market and its major players at a particular point in time. Gartnerʼs assessment takes into account vendorsʼ current product offerings and overall strategies, as well as their planned initiatives and product road maps. They also consider how well vendors are driving market changes and adapting to changing market requirements.

For details on Business Strategy or DAM / ECM consulting engagements with VP of Strategy, LLC, contact Scott M. Eilers to set up a free consultation: scottmeilers@gmail.com 971-269-5021