Consolidation fever not yet over for ECM market

Although the number of enterprise content management (ECM) suppliers has shrunk considerably with IBM’s acquisition of FileNet and OpenText’s purchase of Hummingbird, experts are predicting more consolidation in the sector.

This summer has seen a spate of ECM acquisitions , sparked off by the purchase of Hummingbird, initially by venture capitalist group Symphony Technology before market rival OpenText abseiled in at the last minute to scoop up Hummingbird for its ECM offering.

IBM then played its joker, snapping up FileNet for $1.6bn (£842m).

David Macey, vice-president of international operations at Stellent , said: “IBM was looking for market share – it really did compete with FileNet.

UK-based Macey said organisations now had a choice of just four ECM platforms: EMC, IBM, OpenText and Stellent.

Analysts said that consolidation in the market had only just begun.

“Larger business intelligence vendors will look at ECM products to bring corporate information into one package,” said Mike Davis of analyst Ovum.

According to Macey, consolidation is being driven by enterprises treating information management as part of business infrastructure. Major IT infrastructure providers such as IBM are buying vendors to incorporate ECM into their offerings, while ECM providers such as Stellent are acquiring specialist technology providers to supply a total package.

Alan Pelz-Sharpe, a former ECM analyst and consultant, agreed with Macey and predicted: “IT giants are likely to follow IBM’s lead.”

Macey said that enterprise search vendors could also be sizing up ECM providers: “I definitely see more consolidation to come.”

Despite the consolidation, Macey said the market was still strong. “Regulatory issues like Sarbanes-Oxley, corporate governance and risk compliance are still strong drivers for ECM. There are also still large companies that have never looked at document and information management as part of their strategic view.”