The inbox is the workplace.
According to Osterman Research, a firm specializing in market analysis for the messaging and collaboration industry, more than half of typical business information is stored within electronic messaging systems. Sales orders, contracts, and negotiations are all initiated through email. The ethereal inbox then becomes the archival resting place of these crucial documents. That makes email, often considered a casual communication tool, a mission critical business utility.
With the growing trends of collaboration and global integration, enterprise messaging takes on even greater importance. It is the main tool for overcoming time and geography as well as the primary medium for exchanging documents. Computers are the windows through which people and businesses interact and messaging is the core of that interaction.
The enterprise messaging marketplace is a catchall of tools and utilities bringing together corporate email, calendars, instant messaging, shared documents, mobile devices, wikis and a growing list of collaborative widgets. Email is already one of the most important business applications, accounting for up to 25% of productivity according to Osterman Research. Still developers are rolling out new ways of using email and integrating it into every business function. Osterman’s research shows email has a growth rate of roughly 20% per year.
While a feature rich suite is de rigueur for driving new sales and generating buzz, the most poignant tasks for enterprise messaging are the technical challenges of storage and security.
Storage encompasses more than just pure capacity. Both the vital nature and growth of data in messaging systems means backup and restore features must deliver absolute reliability and quick turnarounds. Collaboration drives up the frequency and size of file attachments, which again effects storage. Lastly a data mining strategy is a necessary part of the picture. Enterprises need to keep track of all the imperative and innovative work being done through messaging. Effective archival search and capabilities can recover “lost” data and revel potential leaks of sensitive information.
Add to that the increasing number of regulations, including Sarbanes-Oxley, the Health Insurance Portability and Accountability Act (HIPAA) and even the Patriot Act. All require companies to retain records that may be relevant in later litigation or other compliance. A thorough storage strategy allows companies to readily comply with legal discovery. It will even protect companies from well-meaning or unwitting employees who delete vital records, possibly committing a federal offence and exposing the company to liability. In September 2007 Morgan Stanley was fined $12.5 million for failing to produce emails required in court and to date the firm has paid tens of millions of dollars to settle regulatory charges over “lost” email.
Tied in with storage is security. Nobody wants to backup gigabytes of spam. Administrators expect enterprise systems to eliminate spam before it enters their network. Spam volume keeps growing and new tactics including images and attachments are making the actual messages larger, potentially wasting both corporate bandwidth and storage capacity.
More nefarious challenges such as viruses, spyware, and other attacks also expand in lockstep with email and instant messaging growth. Both are doorways hackers routinely try to exploit to access enterprise networks. A messaging system needs to recognize threats and prevent them from entering the internal network.
Message encryption for outgoing traffic is another security factor. Email is used to contact outside law firms, development partners or overseas vendors and suppliers. Sensitive information needs protection from eavesdropping, tampering, and theft. A robust enterprise messaging system offers rule based or blanket encryption of all data traffic.
Storage and security are major factors that appeal to IT departments. However, if popular features such as mobile access or instant messages are not part of the package, users will circumvent the system to get the features or conveniences they want. A successful messaging product has to bring the full package.
Microsoft Exchange Server and IBM’s Lotus Notes/Domino are the dominant providers in the enterprise messaging marketplace. Both offer a full suite of collaborative and robust IT features. Together they hold over 90% of the market, roughly a 60-30 split. Novell’s GroupWise product takes a distant third place in most industry comparisons and is largely considered a legacy patch that will continue to lose market share as companies migrate away from the Netware platform.
Both Exchange Server and Lotus position themselves as complete solutions with lavish collaboration features and add-ons. Microsoft’s SharePoint and Lotus Quickr are platform extensions, which each company pitches as work environments designed to unleash creativity. The advertising and media hype is all about how the nuts and bolts of IT runs quietly behind the scenes while users are free to work, share and innovate. It’s a slightly utopian view but in effect giving people tools that are intuitive, unobtrusive and interoperable wrings more productivity out of every day. That is the very premise of email in the first place. There’s plenty of anecdotal evidence in the productivity gains since the 1990s to support the idea.
With sales in excess of $1 billion, Microsoft Exchange Server is the leader in enterprise messaging products. Microsoft’s Corporate Vice President Chris Capossela told the on-line publication Mysolutioninfo.com, “more than 80 percent of the Fortune 100 companies deploy Exchange Server as their primary e-mail and calendaring solution.” Much of that market dominance is built upon earlier success with Windows and Office products. Both users and IT departments want their software to work as seamlessly as possible. For most companies that means more Microsoft. Unless a competing product offers significant advantages there is little incentive to switch. And if opinions in the IT trade press are representative, IBM’s offerings are not innovative enough to cause significant migration. In fact Microsoft claims to be taking market share from IBM, a position that is echoed by the research firm Gartner. They predict Exchange Server 2007 will grow Microsoft’s share of the market to 70%, largely at the expense of IBM.
SharePoint is adding to Exchange Server’s dominance and is already one of Microsoft’s fastest growing products. SharePoint moves Microsoft toward what is now being called Unified Communications (UC). The idea brings applications, email, instant messages, voice, fax and video all under one umbrella. Vendors, including Microsoft, still seem to be working out the details but the roadmap points toward an inevitable convergence. You can already access email on your phone and Exchange Server lets you get voice mail in your email.
The new direction brings new players into the market. Suddenly Cisco is a possible partner or competitor. Cisco has used the UC terminology for several years already. Avaya and Nortel both have products they label as UC. With the huge dollar amounts on the table no one wants to be left out, which could lead to better integration altogether.
As vital as email has become, it is also a commodity. For personal use email is largely free. Running water, electricity and telephones all once revolutionized business; email may too recede into the wallpaper as a service.
The next big challenge to Microsoft Exchange server isn’t from a new IBM or Novell release or even an open source Linux application. It’s more likely to come from the likes of Google and the myriad of companies offering outsourced email services. Imagine email not as an Outlook or Notes, but as a new incarnation of the old Ma Bell.
Google already offers many of the features the large software companies are touting. Integrated email and instant messaging, calendar, mapping, robust spam and virus protection, deep archiving, mobility and collaborative applications are all part of the ad supported Google package. Granted the average user of these services is so small that they are not even in the Lotus or Exchange Server market. But there are a handful of companies that target larger enterprises with a similar email “service,” including the critical storage and security features discussed earlier. In fact Google just purchased one of them, Postini, in September 2007. Google has made no secret about its aims to become an information juggernaut. The company claims 100,000 businesses are already using the “Google Apps” communication and collaboration tools and the Postini acquisition adds over 10 million users to that base.
The inbox is the workplace and it’s been a lucrative place for Microsoft. While Exchange Server 2007 may have cemented the company’s lead, it might only be in time to start a new battle, this time against competitors that didn’t even exist when Microsoft started the fight.
