Documentum's best days are behind it.
That's what CMSWire is hearing from industry analysts, solution providers (EMC ECD partners) and corporate users in the wake of OpenText's acquisition of the enterprise content division (ECD) of the newly merged Dell Inc. and EMC.
The buy includes Documentum.
Snuffing Out the Light?
Rob Gascho, vice president of solutions at XY Vision, called it earlier this month in a comment in response to a CMSWire article on the future of Documentum.
He speculated Documentum would end at OpenText "everyone's favorite graveyard for unloved (ECM) tech."
And though his claim might seem dramatic, consider OpenText's history of acquisitions of industry innovators and leaders, including Vignette and PCDOCS (a part of Hummingbird Enterprise Suite).
The brands — and perhaps the innovation in their products — have all but disappeared.
Laurence Hart of the Word of Pie blog, said "OpenText is feasting on the bones of its rivals."
OpenText's Acquisition Strategy
Carnivorous as it might seem, it's not a bad strategy if you're OpenText, according to Forrester analyst (and former OpenText employee) Cheryl McKinnon.
"OpenText has grown its business primarily through acquisition," she told CMSWire, adding that the Waterloo, Ontario-based enterprise information management provider is successfully consolidating the ECM vendor market — at least the first generation providers, that is. Of the earliest leaders only Hyland, IBM and OpenText remain longtime residents of Gartner's Leaders Magic Quadrant.
Real Story Group analyst Tony Byrne said Dell-EMC's ECD has some interesting features as well as inroads into some verticals (such as Pharma) where OpenText has some weakness, although "none of them are earth-moving." When it comes to the core platforms, "(OpenText) Content Server and ECD (Documentum) core platforms overlap perhaps 70 to 80 percent," he added.
EMC's Lost Opportunity With Documentum
Documentum has reinvented itself several times since the time that EMC acquired it in 2003 for $1.7 billion. Though EMC purchased many content products and added them into the ECD portfolio (most notably Captiva and DocSciences) and even developed its own product lines — EMC InfoArchive and EMC Leap — it never grew the business. In fact, OpenText paid $1.62 billion to acquire ECD today — less than what EMC paid 13 years ago.
Some industry watchers, including Digital Clarity Group analyst Alan Pelz-Sharpe, have long contended the value of ECD was waning.
The depreciated value reflects EMC's poor execution on strategy, they concur.
Documentum was an early provider in the content collaboration space. It acquired eRoom in 2002 when internet chat rooms were a big deal, and way before SharePoint entered the ECM space.
EMC tripped again with CenterStage in 2009. Ditto for Documentum's availability on mobile devices.
At EMC World in 2008, then EMC IIG (ECD predecessor) vice president Whitney Tidmarsh stood before a crowded house demoing a soon-to-be-released Documentum mobile app that no one ever saw again. (A different one appeared years later.)
EMC's content group could innovate, but struggled to get products to market. Until recently, anyways.
What Will OpenText Do With Documentum?
Analysts are mixed on what OpenText will do with Documentum. Pelz-Sharpe is optimistic, calling OpenText the champion Documentum never had in its years under the EMC umbrella.
"For the first time in over a decade, they will be in a place that understands what it does and appreciates both its technology and the strength of the Documentum brand. Hopefully Documentum will remain semi-autonomous within OpenText and be provided the support needed to return to strong growth," he said.
But others see the glass as half empty. One EMC ECD partner, who asked not to be named, told CMSWire "Documentum is done." Another concurred with that conclusion, but held high hopes for InfoArchive, noting that it represents at least 50 percent of the price OpenText paid to acquire ECD.
Worries for Documentum Partners
Either way, Documentum partners said they won't be sleeping well this week.
"Uncertainty into product direction plays into competitors' hands," one told CMSWire.
Rohit Ghai, president of the Enterprise Content Division at Dell EMC, tried to quell the panic in a boiler plate blog post:
"As we work toward the close of the transaction, I assure you that we will continue to provide the world-class care our customers have come to expect. To underscore our joint commitment, OpenText and Dell EMC have also announced their intent to enter into a strategic commercial partnership to expand customer offerings and better serve customer needs."
Customers and partners can continue to realize value from their ECD investments and gain additional value from a richer portfolio of ECM and EIM solutions, he said, adding that today's news is great for all stakeholders. "We hope you are as energized as we are about the opportunity ahead," he added.
That doesn't seem to be the case. According to an informal CMSWire’s poll, more than 60 percent of responders believe OpenText is interested in product revenues only and won't be investing in further development.
Title image by Pablo Garcia Saldaña