A group effort
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Collaborative technologies are enabling businesses to work together seamlessly across geographically dispersed locations.
At the launch of the first major wave of products Microsoft has released since Bill Gates became chief software architect three years ago, there was one overriding theme: collaboration.
According to Gates, the very raison d'etre of Office System 2003 was "the idea of people working together more effectively". Simplistic as this may sound, enabling people to work together over electronic networks is proving to be a more complicated goal than perhaps first expected - and is fuelling the growth of a multi-billion pound industry. The forerunner of today's collaborative technologies was groupware, a concept pioneered
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There have been many followers of this approach. But as the IT world has moved to more flexible and lower-cost web architectures, that two-tier client-server model has became outdated. Changing business needs has required a new approach to collaboration: companies are more likely to work across dispersed locations and deploy a number of different applications to do so.
It has taken many years for the idea of collaboration to gain a foothold. At first the infrastructure could not support it and there was inadequate bandwidth and IP capability to the desktop. Lack of interoperability between collaborative products built on proprietary technology has also hampered adoption, but the growth of the Internet has helped changed that.
The collaboration market can be segmented into an almost-saturated groupware and messaging services market cornered by Lotus and Microsoft, and an emerging market for 'advanced' collaboration services, including instant messaging (IM), white boarding, web conferencing, e-learning, IP telephony and presence awareness.
The potential of the market is well documented. IT industry analysts Ovum estimate that the overall collaboration market was worth more than $2 billion in 2002, of which about $1.6 billion came in messaging services and the rest from advanced collaboration tools. By 2007, the market will be more than $2.6 billion. While growth in the messaging segment will have been flat, the advanced collaboration tools segment will have grown rapidly to just over $1 billion.
As the market matures, users are starting to demand greater capabilities. The most sought after requirements, according to a recent survey by analyst group Forrester Research, are document sharing, workflow and business process management (BPM).
"The impetus for collaboration is all about better customer satisfaction, acquiring new business or being a trusted advisor - for example, [with a] 24x7 helpdesk," says Mike Kan, European managing director for collaboration services at EMC's enterprise content management subsidiary, Documentum. "There is also a lot of interest around compliance and Basel II," he says.
More traditional features like shared meeting facilities and online training remain key drivers for collaboration, according to 46% and 43% respectively of respondents to the Forrester survey. However, IM and chat, features pushed strongly by Microsoft and Lotus, scored a low 6%, perhaps reflecting fears of employee time-wasting and security breaches.
That need for greater functionality and compliance has resulted in a drive towards integrated collaboration suites, termed 'Smart Enterprise Suites' by analysts at Gartner.
These typically bring together document management, web content management (WCM), knowledge management (KM) and digital asset management features with collaborative functionality and are delivered as a package from one vendor, not simply by cross-marketing agreements.
"The implications of the smart asset enterprise suites go beyond simply an aggregation of portal, content management and collaboration functionality," says Simon Hayward, an analyst at Gartner. "It should indeed grow the market. It also marks a jumping-off point for the next generation of software applications."
Consequently, merger and acquisition activity by point-product providers has resulting in widespread consolidation.
WCM specialists Interwoven and Vignette have both made extensive acquisitions. In recent years, Interwoven picked up collaborative content software supplier iManage, while Vignette bought Epicentre, collaboration software vendor Intraspect and document management supplier Tower.
Document management companies have also been active. Documentum acquired collaboration vendor eRoom and records management company TruArc, before itself being snapped up by EMC. FileNet purchased WCM provider eGrail and forms management technology from Shana.
Collaborative software provider Open Text strengthened its document offerings, buying portal software vendor CoreChange and Ixos for WCM. Companies with a strong tradition in conferencing systems have also broadened their scope to cover all aspects of collaboration. Notably, Polycom has built an integrated suite of voice, video, data and web collaboration products through its acquisitions of Accord Networks, PictureTel and Voyant.
Analysts largely approve of such technology combinations. "The exponential growth of content will force business executives to invest in technology for content handling, contextual delivery and collaboration," says Andrew Warzecha, a Meta Group analyst.
It is now imperative for these companies to ensure swift integration of the often very different product sets and corporate cultures. "For those companies that don't succeed in integrating products quickly and successfully, customer dissatisfaction and churn will become a real issue," says James Murray, European vice president of content management software vendor Interwoven.
David and Goliath
All this activity may yet prove disastrous for smaller vendors if, in the long run, developing a collaborative suite puts them in direct competition with Lotus and Microsoft. With the two incumbents controlling about 90% of the email market, and most 'information workers' spending the majority of their time using Outlook, Office and Notes, it will be difficult for smaller vendors to maintain market traction against them.
What's more, IBM and Microsoft have most, if not all, of the capabilities of a so-called smart enterprise suite in their existing product portfolios, and are currently in the process of reorganising these to address the market.
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Among the larger vendors developing collaborative portfolios, there have been varying degrees of success. Oracle's Collaboration Suite, for example, bases email, portal and calendaring functions on its application server infrastructure. But while Oracle says its technology costs a fraction of the price of Exchange, adoption has been patchy.
Business applications vendors have also entered the collaborative sector. SAP has invested heavily to graft collaboration to its xApps and NetWeaver software. PeopleSoft is also building capabilities into its AppConnect platform, though it lacks content-centric applications. And while Siebel Systems' Application Base has many elements of a smart enterprise suite, its overall approach to collaboration is not well-defined.
But Lotus and Microsoft remain the dominant players. To maintain this position, Lotus is in the process of overhauling its ageing client-server products. In 2003, the company announced plans to migrate its 60 million-strong Domino installed base to a new platform based on IBM's WebSphere application server, the DB2 relational database and its Tivoli management platform.
That is a huge undertaking, as Lotus has historically had its own development environment, its own (object) database and its own management tool suite.
A key feature of the change includes the introduction of a collaborative portal-based platform known as Lotus Workplace. The move is intended to capitalise on the company's core collaborative functionality, within a flexible, web-based environment and will help fend off competition from portal vendors such as Plumtree and Vignette.
Lotus has also opted to provide collaborative capabilities across a single screen application, a move that has been met with approval by analysts. The company is staking its future on the new system. A successful move to a WebSphere-centric collaboration platform will provide a broader alternative to the integrated collaborative functions Microsoft has added to the latest version of its Office suite.
That may be easier said than done. With Office System 2003, Microsoft brought together a collection of client applications and services that provide collaboration, centred around its core Word, Excel and Outlook products.
Microsoft is not providing single screen access to the various applications on offer, but is instead opting for a 'contextual collaboration' approach, building collaborative features into its various popular applications. "Our strategy is to provide a common interface to information workers to get the benefit of collaboration without having to go to different web sites - because they won't do it," says Mike Pryke-Smith, Office marketing manager at Microsoft.
There are some similarities in the Microsoft and Lotus approaches to collaboration. Both moved to a component-based platform, one that they say means users are not forced to upgrade the whole of their product architecture to get its benefits.
A relatively slow time to market, however, could count against incumbents still needing to integrate disparate product suites. For example, Microsoft is still yet to fully integrate its web conferencing package, Live Meeting, acquired with its purchase of PlaceWare in 2003. At the moment, it is an add-in (free download), which Pryke-Smith says will be included in the next service pack.
Market leaders
It is generally agreed by both IT analysts and insiders that the low end will be 'owned' by Lotus and Microsoft. "It is likely that the core infrastructure will be cornered by IBM and Microsoft and other companies will provide/build process-specific and industry -specific protocols," says Meta's Ashim Pal.
For example, Windchill by computer aided design (CAD) technology provider PTL enables collaboration across large mechanical design programs, something well beyond the scope of the Microsoft and Lotus systems.
As a result, many smaller vendors are making sure their products can easily integrate with the leading vendor's offerings. There is also a belief that Microsoft's push into the market could even be beneficial.
"Powerful organisations like Microsoft are validating the space," says Mike Kourey, senior vice president of finance and administration at web collaboration vendor Polycom. "Those companies that choose to go with Microsoft might need more appliances, or phones, or other modules, and this is where specialist providers can help."
Vendors promoting collaboration, it seems, need to find useful niches alongside Lotus and Microsoft. But smaller players should be wary of relying too much on such a risky strategy, say analysts. And it may not help customers already buckling under the weight of information overload.
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