While you were sleeping... (The Sharepoint Trojan Horse)

The Wall Street Journal has a great article (and scary, too) on the collaboration/content market, and Microsoft's exceptional strategy to control it. Content? Who cares about content? Microsoft. Very much so. Here's why. Microsoft's collaboration story revolves around Sharepoint, a useful product with ambitious designs. The article describes how innocuously, insididiously companies fall into the Sharepoint trap:

The Wall Street Journal has a great article (and scary, too) on the collaboration/content market, and Microsoft's exceptional strategy to control it. Content? Who cares about content?

Microsoft. Very much so. Here's why.

Microsoft's collaboration story revolves around Sharepoint, a useful product with ambitious designs. The article describes how innocuously, insididiously companies fall into the Sharepoint trap:

When the Miami-Dade County Public Schools set out to build a way for its teachers, students and parents to collaborate online, it was surprised to discover it already had Microsoft Corp. software that could help do the job.

Included with software the school district had previously bought was something called SharePoint Services, which Miami-Dade used as the first step in creating a system for planning school programs and classes, posting notices, and handling other tasks that require its teachers and students to collaborate.

"We kind of unintentionally fell into it," says Deborah Karcher, executive officer at Miami-Dade's information-technology group.

Next thing you know, it's everywhere, and your content/data is nicely wrapped up and held by Microsoft.

Don't get me wrong: Sharepoint, for what it does, is a good product. The problem is not in its functionality, but for what it means for an enterprise. Sharepoint, to be useful, requires more (and more) Microsoft software. It's a one way road into Microsoft:

For Microsoft, SharePoint is a critical engine to increase sales of a broad array of its other software. In 2003 the company made a basic form of SharePoint available as a free download with Windows Server, a version of Windows for the large corporate computers of customers like Miami-Dade schools. The hope was that the customers would seek -- and pay for -- a newer version of the program with more collaboration features and would then go on to buy other Microsoft software....

The catch: To squeeze all of the functionality out of SharePoint, Microsoft customers need to buy extra software from the company if they don't already have it. For instance, features in the latest version of SharePoint will work only with Microsoft's Office 2007, the newest version of the business software suite. That could be a beneficial connection for Office, as Microsoft struggles to convince some business to upgrade to Office 2007 when their current Office setup works fine.

It's a strategy that has worked phenomenally well (0 to 85 million licenses and $1B in just four years). It's a strategy that should have every CIO concerned. Open source, too, has spread like wildfire, without CIO intervention in many cases. But the difference is in the appetites of Sharepoint versus open source. If you don't like open source (databases, middleware, or whatever), you just remove it. It's open source, and generally open standards, so there's no (or little) lock-in.

Not so with Sharepoint.

The collaboration battle could have long-term strategic benefits for the companies. Once a given software maker's collaboration programs are in place, a company using them will start filling them with valuable company data, from documents to videos.

After all that company data is in the system, it's hard to move to a competing system, say some industry executives, who compare the emerging collaboration battle to an earlier era when Oracle became the market leader in databases after a mass of companies committed their information to Oracle databases. Once companies were on an Oracle database it became easier for the software maker to sell upgrades and other software -- and harder for competitors to woo away the customer.

"Owning the data is owning the customer in perpetuity," says Matt Asay, vice president at Alfresco, which makes software for managing content.

It's so easy to put the content into the system - it's very hard to get it out. Across the industry as we fixate on ERP wars, SaaS, etc., there's a quiet battle going on across the enterprise. And it's being lost to Microsoft. After all, it's just content, right?

Microsoft certainly doesn't think so. Sharepoint is its new operating system - the hub or platform upon which its hold on the enterprise tightens and extends. No matter what product you're selling into the enterprise, if you don't have a Sharepoint story, you're in trouble.

Open source is the best way to respond to Sharepoint, because you have to fight ubiquity (Windows) with ubiquity (open source). Oracle and IBM also have a good chance, because they have franchises (databases and such) that put them in a wide range of enterprises. But open source is arguably a better ubiquity play, because I don't have to sell anything to establish a beachhead. It's just a download away.

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Copyright © 2007 IDG Communications, Inc.

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