Portals

An in-depth look at the portal market.

Although the portal market dates back to just 1997, it’s already matured to the point where few independent portal software vendors remain. Large infrastructure, content management and packaged applications vendors—even Microsoft—are fighting over this market.

My, How You’ve Grown
In their simplest form, portals provide a single user interface to multiple data sources and applications. Their target user base has grown beyond employees to partners, suppliers and customers. And their intended purpose has matured from simple, self-service human resource tasks to complex, collaborative knowledge management and business intelligence applications. According to META Group, portal frameworks represent one of the primary e-business investment areas for Global 2000 organizations.

Market Movers

Epicentric
February 2002: Company announces the Epicentric .NET Toolkit.

Our take: Broader standards support is key to widespread portal adoption. Although Epicentric’s Foundation Server was built in Java, the company needs the support of a Microsoft base as well. Expect others to follow suit if they haven’t done so already.

Microsoft
July 2001: Microsoft releases SharePoint Portal Server.

Our take: This product represents a basic foray into the portal market, offering simple functionality for finding, sharing and publishing information within Office and Windows environments.

November 2001: Microsoft Solutions for Intranets (MSI) is announced.

Our take: The goal here seems to be twofold. First, Microsoft may be responding to competition from strong, platform-independent portal technologies. Second, Microsoft still needs to be perceived as a valid enterprise player. MSI may help do this, because it delivers a much broader and deeper functionality than SharePoint Portal Server (which is part of the MSI package).

Plumtree
March 2002: Company announces Plumtree Collaboration Server, Studio Server, and Gadget Framework for Microsoft Excel.

Our take: To survive heated competition from larger ERP and knowledge management vendors, pure portal player Plumtree must demonstrate its ability to support broad, collaborative workgroup environments. That’s exactly what these releases set out to do.

SAP
May 2001: SAP acquires portal software vendor TopTier.

Our take: SAP eagerly wants a chunk of the portal market. The TopTier acquisition solidifies the company’s portal image and provides a strong technology foundation for the company’s spin-off, SAP Portals.

January 2002: SAP merges SAP Portals and SAP Markets into one, independent subsidiary owned by SAP.

Our take: Although this move presents logistical benefits for SAP, many analysts are concerned that it will alienate relations with business application partners who will view the new entity as competition. It may also hurt SAP Portals’ earlier attempts to win customers that work with mixed application environments.

Vignette
March 2002: Vignette re-names portal product as Multisite Content Manager.

Our take: Content management vendors such as Vignette have been eager to claim their portion of the portal market. Vignette’s greatest strength, however, is its content management technology. This move puts the company’s product focus back in perspective; appealing to companies that have already implemented portal frameworks from other vendors but still need a content management solution.

 

Portal Metrics

  • Average new portal project cost for large firms: Approx. $1 million

  • Average percentage of work time employees spend looking for information: 25%

  • Firms unable to identify portal ROI metrics: 61%

Source: Forrester

Managing Multiple Portals
Just as organizational politics and budgetary restrictions prompted people to implement data marts instead of data warehouses, today organizations are being overrun with independent, departmental “silo” portals.

Several portal infrastructure vendors offer varying degrees of management support, but pure-play portal vendor Epicentric was one of the first to market specific Enterprise Portal Management (EPM) functionality in its October 2001 release of Foundation Server 4.0. Epicentric’s EPM system is designed to help with the construction, consolidation and management of multiple portals deployed throughout the enterprise, allowing for centralized management yet distributed administration.

Software Market Revenues

Numbers are for worldwide enterprise information portal revenues.

2001: $461.2 million
2006: $2.6 billion

Source: IDC

Gartner Inc. expects most enterprise portal vendors to market similar EPM capabilities by the second half of 2002, with the market continuing to play itself out until the end of 2003. “Enterprises shouldn’t yet consider lack of EPM capability or positioning a fatal flaw in a vendor’s offering,” explained a recent Gartner report. “Vendors have yet to understand, much less package, the full scope of EPM.”

No Clear Winner
The portal market has already seen significant shakedowns, but the clear leaders remain to be determined. According to META’s David Yockelson, the market should remain crowded “and clouded” through 2005, with IBM, SAP, PeopleSoft, Plumtree, Epicentric, iPlanet (Sun), BEA, BroadVision and Vignette dominating the market.

Portal Evaluation Criteria

When considering enterprise portal technology, be sure to seek out products that support:

  • Robust search across all structured and unstructured repositories

  • Taxonomy

  • Content management/aggregation

  • Personalization

  • Application integration/development

  • Support for application servers

Source: Gartner


Fundamental Financials: Last 12 Months
Vendor
Symbol
Sales
Income

Net
Profit
Margin

Return on Equity
Debt/
Equity
Ratio
Rev
per
Share
Earngs
per
Share
BEA
BEAS
$975.9 million
-$35.7 billion
-3.7%
n/a
0.87
$2.43
-$0.09
BroadVision
BVSN
$244.5 million
-$836.3 million
n/a
n/a
0.01
$0.85
-$3.02
Computer Associates
CA
$2.93
billion
-$1.27
billion
-43.5%
n/a
0.53
$5.07
-$2.20
IBM
IBM
$85.87 billion
$7.72
billion
9.0%
35.1%
0.80
$49.85
$4.35
iPlanet (Sun)
SUNW
$14.06 billion
-$563 million
-4.0%
n/a
0.24
$4.33
-$0.17
Peoplesoft
PSFT
$2.07 billion
-$191.6
million
9.2%
12.0%
0.00
$6.70
$.059
SAP
SAP
$6.43 billion
$722.5 million
11.2%
32.1%
0.00
$5.10
$1.01
Vignette
VIGN
$296.8 million
-$1.53
billion
n/a
n/a
0.00
$1.20
-$6.32
Note: Epicentric and Plumtree are privately held companies and therefore not included in this list.
Source: Zacks Investment Research