Enterprise content management firms merger will create 'one-stop shop'

Canadian enterprise content management (ECM) solution builder Open Text is to merge with German ECM provider IXOS Software to ...

Canadian enterprise content management (ECM) solution builder Open Text is to merge with German ECM provider IXOS Software to  form what is claimed to be the world’s largest pure-play ECM provider. 

IXOS will become a wholly owned subsidiary of Open Text and will act as the European division of the company.

Open Text has, historically, operated in the people management, collaboration and content management side of the equation, explained David Glazer, vice-president of product management for Open Text.

The company initially began life as a mechanism to connect people to information by providing the tools to manage content created through collaboration.

IXOS’ heritage has been focused on the archiving and the long-term resting-place aspect of content as the information becomes storage.

"You put these together and you have the entire information lifecycle covered," Glazer said. "Any piece of unstructured data that anyone in the organisation touches from womb to tomb...all of that can be unified into one enterprise content management system. You couldn’t have designed a better global leader in ECM than by taking these two pieces and putting them together."

Under the business combination agreement, Open Text’s North American division will focus primarily on the collaboration and knowledge management offerings, while the European division, based in Munich, will concentrate on content management and archiving capabilities.

Open Text’s merger with IXOS puts the company in direct competition with the likes of EMC and IBM. However, despite the economies of scale, Glazer is confident Open Text will not flounder.

"We are seeing a customer push and pull. The...push is as people recognise how critical ECM is to their IT and operational plans, they know that cannot purchase (solutions) from a hodgepodge of vendors or from small vendors," he said.

"The pull that we see is as customer realize that ECM...really is an enterprise capability, they recognizs the value in one-stop shopping."

This recognition may indeed be the key to survival for the "world's largest ECM vendor", according to Nick Wilkoff, senior analyst with Forrester Research. He explained that the combined entity is definitely designed to go after the large companies and will help Open Text compete as more of an enterprise-scale content management supplier.

"I think, for a while, companies will be continuing to look for the best-of-breed, pure-play vendors in this market," Wilkoff said.

"In a three- to four-year period, I think it’s pretty safe to say that the very large vendors, the software giants, will take a leadership role in this market. Still, I think there will be a little bit of room for these pure-plays and Open Text, with this additional functionality may indeed be one of those."

The Open Text-IXOS deal is expected to be completed within the next 90 to 120 days.

Carly Suppa writes for ITWorldCanada.com

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