EMC made big news yesterday when it announced its hybrid cloud play. Headlines raced across the wires saying things like “EMC Frantically Pivots Toward the Cloud” and “EMC Moves Fast To Retain Relevance And to Survive - More Acquisitions Announced.” This isn’t us making the drama. The eye-grabbers come from TechCrunch and Forbes respectively.
Not one of the articles mentioned Documentum. In fact, it doesn’t seem to play a role in EMC’s survival. And this isn’t just what the lack of media attention to EMC’s Enterprise Content Management play suggests. In EMC’s quarterly call with investors last week, neither EMC CEO Joe Tucci nor his lieutenants (David Goulden, CEO of EMC Information Infrastructure and CFO Zane Rowe) uttered the name of its spawn at all.
Out of the Spotlight
What they did offer is that EMC’s Information Intelligence Group’s (IIG owns Documentum) revenues showed 3 percent growth (EMC revenues grew 9 percent year on year) and they singled out Enterprise File Sync and Share (EFSS) solution, Syncplicity, as its star performer.
Now while some might say that the expectation of Documentum being mentioned by name is a little unreasonable, given its size in comparison to EMC’s other businesses, that’s at least part of the problem.
Especially when you consider that EMC bought both it and VMWare at around the same time. Needless to say, their levels of growth are so very different that one might stand out as the best acquisition Tucci ever made and the other …
We’re not taking anything away from Documentum here. As analyst Alan Pelz-Sharpe said in our earlier article, Will EMC Dump Documentum, it’s a very good company. It might just do better if it stood on its own or was purchased by a company that looked at it anew and saw a future for it on the 3rd platform.
Now we’re not suggesting that EMC set Documentum free for the good of Documentum, behaving like a parent who recognizes that it’s stunting its child’s growth. But it might be time for Tucci (or maybe Elliott Management) to ask if these companies are providing much benefit to each other.
The world is very different than it was in 2003 when EMC initially bought what was then called “the Cadillac” of content management. Storage was expensive then. Now it’s a commodity. And when it comes to the cloud, EMC is struggling to find a foothold in the heavens itself. The latter is where Tucci is placing his bets when you consider that wallets tend to do the talking.
What HP Offers
Grant it, HP has certainly had its own problems of late, but it has deep pockets and it has demonstrated that it has a keen and more interest in ECM. Forget that it grossly overspent on Autonomy, as CEO Meg Whitman has said. The problem is not about what Autonomy has to offer but how much HP paid for it.
And while Autonomy is labeled a Challenger and Documentum a leader in Gartner’s most recent MQ for ECM, if these two companies can combine the best of what they have to offer, cut the fat and perhaps most importantly, build a 3rd platform play, they could disrupt the entire ECM industry.
HP already has Autonomy pointed in that direction. Autonomy’s IDOL is a key component of HAVEn, HP’s big data platform which also includes Hadoop (Hortonworks’ Hadoop distro HDP), Vertica (its massively scalable database platform, custom-built for real time analytics on petabyte-sized datasets), Enterprise security via ArcSight (real-time collection and analysis of logs and security events from a wide range of devices and data sources, leveraging big data to bridge both operational intelligence and security intelligence) and nApps (open, scalable platform that forwarding organizations and developers can leverage to create a broad array of next-generation applications designed to fully leverage the power of big data.)
How Documentum/IIG Fits In
What could Documentum/IIG bring to that party? Its customer base, its knowledge of vertical markets and its specific solutions geared to address their most important needs. Add to that xCP (xCelerated Composition Platform), D2 (for configuring intuitive and personalized user interfaces), InfoArchive, possibly Syncplicity (though Tucci may be even less likely to part ways with it) its stellar team, and much, much more.
At HP, Documentum (or at least its assets) could become a vital part of its 3rd platform play. And HP, for its part, would benefit from Documentum’s important, trusted customer relationships that it has spent more than two decades nurturing.
Documentum wouldn’t be introducing HP to its customers, hoping relationships would form. They would already be in place.
Focus on the Potential
Now grant it, this might not be a big game-changing acquisition for HP, but it’s one that holds plenty potential and Whitman isn’t afraid to take risks. And the sale wouldn’t be a windfall for EMC but Tucci has proven time and time again that he can earn more from his investments than what Documentum is generating now.
So while Tucci and Whitman couldn’t make the larger EMC/HP deal work, there’s a smaller one here that makes plenty of sense.
And since Whitman said she’s willing to shop, it’s time for Tucci to send out his pitchman (though we might have just done that for him).