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Box-IBM partnership shakes up ECM software market

The recently announced Box-IBM partnership provides benefits for both companies and customers. But the jury is still out on how well the two companies will work together.

On Tuesday, June 24, IBM and Box announced a partnership to join forces on enterprise content management to "transform...

work in the cloud." The partnership promises benefits for each company and for customers. But the jury is out on how well these divergent company cultures can execute on merged products.

Los Altos, Calif.-based Box, a cloud-based file-sharing service, will integrate IBM's Watson analytics and security offerings into its content collaboration platform and will enable users to store data on IBM's cloud, SoftLayer. Armonk, N.Y.-based IBM, a global IT services company with its own content management application, will enable its users to access Box from IBM applications such as email and social platforms. [See "IBM and Box: Partners in the cloud" below for details.]

"This is the first time we are doing anything like this collaboration at scale to go out there and serve joint customers," Box CEO Aaron Levie said.

A partnership of mutual gain

This enterprise content management (ECM) software market partnership signals benefits for both sides -- and potentially for customers. Box obtains the benefit of a well-established and extensive IBM ecosystem and cloud infrastructure. Box can also guarantee to its customers that content resides on a data center in a certain country -- often a regulatory or compliance requirement for various industries.

For IBM, the ability to crack into Box's successful cloud-based content management offering, with a reputation for greater ease of use and flexibility than traditional ECM software, helps it move away from the "stodgy software" column into the forward-looking, cloud-first landscape that Box represents.

"For Box, obviously it gives it access to large enterprise customers it covets and for IBM, it gives it access to a modern content management company built from the ground up for the cloud," said Ron Miller, a TechCrunch writer and SearchContentManagement contributor.

Analysts closely watching the announcement agreed.

"It ups [Box's] street cred on targeting the enterprise," said Cheryl McKinnon, an analyst at Cambridge, Mass.-based Forrester Research. "They now have access to a whole range of enterprise-grade capabilities that IBM brings on the transactional side of the house -- analytics, case management, workflow, BPM [business process management]. For IBM, it is integration of lighter-weight document services for a new generation of email. They are looking for that fast, agile way of working."

Box grows up; IBM marches forward

Box benefits from enterprise-grade capabilities. The partnership also takes aim at historic voids in each company's market positions. Since the IPO, Box has tried to position itself as less consumer-driven, more enterprise-ready. In February 2015, it stepped up its security features by incorporating Enterprise Key Management (EKM) to ease customer concerns about using a cloud-based content management service. EKM enables customers to encrypt content data themselves on-premises rather than rely on the Box platform.

With the partnership and IBM's global data center infrastructure, Box can guarantee the country hosting the data center where content is stored. "They can speak more holistically about keeping that client compliant in that client's local regulatory environment," said T.J. Keitt, an analyst at Forrester Research. "It may give more credence to [Box's] story about security, because IBM wouldn't put its stamp of approval on a content service unless it was being managed, monitored and secured properly."

Box also can take better advantage of IBM analytics capabilities that have real business value. "They can have this platform of demonstrating Watson against a repository like Box. It's the art of the possible when you bring together that analytical capability with the information companies can store in their systems," Keitt said. "The idea is to help people see things they weren't seeing before because they're not thinking system-wide."

So, for example, a meeting that includes several employees and is scheduled in Outlook would analyze other meetings with these participants, topics discussed in email messages and documents that participants share. Based on these connections, it might present a document that would be relevant background for an upcoming meeting. Keitt said that Box is "acutely aware" of Microsoft's inroads on content analytics with its Office 365 applications and is angling to stay competitive.

IBM benefits from cloud-first mentality. Like other traditional vendors in the ECM software market, IBM has struggled with user adoption as more user-friendly and lightweight cloud-based systems have entered the scene from Box and Dropbox.

"Box has a better reputation for, and understanding of the mobile-first and cloud-first world that IBM is orienting itself toward," Keitt said.

IBM also can benefit from the increasingly hybrid nature of content management, in which users have multiple ECM software systems and where some content resides behind the firewall, some in the cloud. "We're going to be living in a hybrid world for the foreseeable future: It's old and new, on-premises and cloud," McKinnon said.

For IBM, a hybrid cloud content management equation frees its customers to make content collaboration with third parties more of a reality, without some of the hurdles of on-premises systems, McKinnon said. Box enables document sharing and collaboration with third parties, which could have great impact for industries like financial services, insurance and others where it's important to be able to share documents without having to let third parties behind the firewall or train them on ECM applications that aren't intuitive.

[The partnership] ups [Box's] street cred on targeting the enterprise.
Cheryl McKinnonForrester Research

"This enables more of these externally facing use cases for ECM -- I'm an insurance company and I have email customers and I don't want to just upload communication, correspondence and forms," McKinnon said. "I want a secure repository, where customers can come in and get access to their stuff. I need something simpler, mobile-friendly, with access anyplace, anytime without a full [costly] license."

Should customers take pause?

But customers may have concerns about the partnership. They should proceed with some circumspection, despite the benefits. First, common feature sets may not prove beneficial. "There are certainly areas of overlap," McKinnon said. Both companies offer basic document management functionality, so that may create tension in the merged offerings. "There may be competition," McKinnon said. "Box is competing for some opportunities that normally would be served by traditional ECM vendors, and it is encroaching. Will there be conflict, where both might have a credible offering?"

The more basic issue is endemic to partnerships of this kind, though. The two companies are different in size, scale, offerings and culture. So their ability to merge and successfully deliver applications that interoperate will be a subject of scrutiny.

"How well these things will play together will always be that big question," Forrester's Keitt said. "Everyone has experience with what is promised and what is delivered. There is still a lot to be seen on how these two can work together."

IBM and Box: Partners in the cloud

With the stated goal of transforming work in the cloud, IBM and Box announced a global partnership on June 24.

The two companies plan to integrate products and services to create new offerings for a variety of industries, according to the release.

Company officials envision the partnership marrying the flexibility of Box with the security/ business process of IBM products. The partnership is expected to focus on three specific areas:

  • Content management. Box will integrate with IBM's enterprise content management technology, picking up features for content capture, extraction, analytics, case management and governance. Box functionality will also be added to IBM's business email offering (Verse) and social collaboration platform (IBM Connections).
  •  Cloud services. Joint IBM-Box customers can use store content in the IBM cloud, which can offer international clients local data storage. Box will gain expanded security features for mobile device management and identity protection and data localization for companies that need to ensure their data resides in a data center in a certain country.
  • Mobility. Box and IBM plan to jointly develop content management technology for mobile apps. The Box application programming interface will also be available for enterprise developers building rich Web and mobile apps through the IBM cloud.

- Nathan Lamb

 

Next Steps

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Microsoft-Salesforce partnership focuses on interoperability

Dig Deeper on Enterprise content management software platforms

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What do you think about the Box-IBM partnership and its impact on the ECM software market?
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IBM and Box make a viable, formidable partner for emerging technology solutions.  ECM and Collaborative Computing strategies within Enterprise accounts are still developing (for the cloud), so timing is right! Question about "Notes" though, and where IBM is directing these customers?
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