Oracle to acquire Stellent: ECM market consolidation continues

Written By: Bloor Research
Published:
Content Copyright © 2006 Bloor. All Rights Reserved.

On 2nd November Oracle announced its intention to acquire
Stellent, Inc. a provider of enterprise content management (ECM)
software solutions, through a cash offer of approximately $440
million. The deal is expected to close by the end of the 2006 or
early 2007. This announcement follows other recent major
acquisitions of Filenet by IBM and Hummingbird by Opentext
demonstrating the continuing consolidation of the Enterprise
Content Management (ECM) software as IT infrastructure companies
make inroads into the traditional ECM vendors’ territory. Stellent
was one of the potential targets that I predicted would be acquired
in a recent article. (see IBM to acquire FileNet – a major
shift in the ECM market.
)

The infrastructure vendors see the ECM market as the next battle
ground for growth fuelled by the rapid growth in unstructured data
such as e-mail, voicemail, digital media, and a variety of business
critical information. All this information is stored in
disconnected silos such as mail systems, file and database servers
and personal computers across the enterprise. This makes it
difficult for organisations to make the best use of their
information assets for competitive advantage. In addition, new
compliance and regulatory requirements such as Sarbanes-Oxley now
require organisations to archive and retain information for much
longer than before.

Oracle has accelerated its content management strategy by this
announcement and declared its intention not to be left behind in
the market that has seen recent developments by other large vendors
such as IBM, Microsoft and EMC.

Oracle’s content management solution consists of Oracle Content
Database which provides basic content services to store and
centrally manage unstructured content in Oracle databases. It
provides the content management infrastructure, repository
services, search capabilities, security and application programming
interfaces for application developments. The addition of Stellent’s
products will enhance Oracle’s capabilities in document management,
web content management, information rights management, digital
asset management, records and retention management, imaging, and
governance, risk and compliance areas.

The Oracle database is already used as Stellent’s preferred
metadata repository. Further integration of the products will
enable Oracle to provide a more comprehensive and integrated
information lifecycle capability and offer content management
solutions that can scale to very large enterprises. Oracle
effectively plans to inject a huge amount of R&D funds that
will enable it to integrate the best of both company’s technologies
and create ECM solutions that will be able to compete with the
larger ECM players. It will take advantage of the proven Oracle
DBMS, with its enterprise level storage, security, search, backup
and other infrastructure capabilities. Through its Fusion
middleware tools it will offer content management capabilities to
its business process management, business intelligence, portal and
WebCenter tools. It will also provide better collaboration
capabilities and provide content management capabilities for its
ERP, CRM, Financial and other business applications.

The acquisition will benefit most customers too. Stellent
customers will benefit from the greater resources of Oracle that
will be used for product enhancements that Stellent on its own
would not have been able to accomplish. They will also be able to
access products that will be more tightly integrated with other
Oracle technology and applications. Oracle’s global presence will
also allow Stellent products to be available in newer markets.

Oracle customers will benefit from the broader suite of ECM
product capability that will now be available to them from a single
supplier. Partner organisations will also benefit from access to a
broader range of technologies to embed into solutions as well as
broader range of specialist value added services to offer.