Vendors: Don’t miss this opportunity to sponsor an important and influential project.

Ferris Research is close to completion of a white paper and webcast on how long electronic material should be kept until it’s deleted. The project will generate significant interest:

• This is the first time the overall electronic retention landscape has been presented. Other work on electronic retention limits itself, narrowly, to email
• It provides very valuable advice on how to decide and implement retention policy. Actionable advice isn’t available elsewhere
• It provides a clear vision of how electronic retention will be done in ten years time. They are invaluable for IT strategic planning

The table of contents and executive summary can be seen here. The final white paper will be published on September 29, on the same day that we’ll hold the webcast.

An inexpensive sponsorship program, starting at $2,495, is available to vendors: see here for details. This is a great marketing opportunity:

• Electronic retention is a complex and hot topic, confusion abounds
• The content of the paper and webcast are important
• The content of the paper and webcast help your prospects decide what to do about retention. That speeds sales, and deployment, and thus revenues
• The paper and webcast will be widely disseminated and discussed, because of their importance. You will want to have your name and logo on it. You won’t want to have your competitors’ names and logos there and be missed out
• Sponsor PR staff will be promoting the white paper and webcast heavily. The material is a good opportunity for you to be seen as a thought leader
• The material can be used for lead generation programs

For further information, or a copy of the full draft white paper, contact David Ferris at +1 415 367 3436, or david.ferris@ferris.com.

Google quietly announced the end of Google Wave on its blog earlier this week. The reason given was that adoption rates were too low.

Just over a year ago we wrote about Google’s big splash around Google Wave. One of the things we pointed out at the time was Wave’s suitability for third-party developers to write applications to take advantage of this platform. In order for a large vendor to be successful at introducing a new development platform – such as Google Wave – a substantial partner ecosystem needs to be developed and nurtured to adopt the new platform. Good technology alone is never sufficient to ensure success in the marketplace.

As our friend Dana Blankenhorn has alluded, simply going it alone, tossing great technology out there, and hoping that the market will converge around any given technology is no replacement for a solid business model. At least Google had the good sense to recognize the problem and do something about it. That takes guts.

Google Wave was cool. But in business there’s more to surfing than simply finding a cool wave.

…David Sengupta. In addition to his role as Ferris analyst, David is chief architect for Quest Software, and has been a Microsoft Exchange MVP since 1998.

Research in Motion (RIM) has been in the news a lot lately because countries like the UAE, Saudi Arabia, and others plan to ban BlackBerry services from their citizens. Specifically Messenger, Web browsing, and email are deemed a security threat by the governments of these countries, for various reasons. In the majority of cases, governments are concerned by their inability to eavesdrop into BlackBerry communications.

Yet, according to RIM, “the BlackBerry enterprise solution was designed to preclude RIM–or any third party–from reading encrypted information under any circumstances since RIM does not store or have access to the encrypted data” (source: ZDNet). Thus, blocking governments’ ability to tap into RIM communications is by design.

Isn’t it interesting that many of the countries threatening to ban the BlackBerry are some of the worst proponents of Internet censorship? RIM President and co-CEO Mike Lazaridis got it right when he stated to the WSJ: “If they can’t deal with the Internet, they should shut it off.” Technologies such as BlackBerry, Twitter, Facebook, and the Internet itself are all just tools that can be used for good or evil. Being able to communicate securely can provide great benefits for democracy, as seen in Iran during the uprisings last year following the election. Terrorists can, of course, also use these technologies for evil.

RIM has done a great job providing a solid infrastructure that is used by millions around the globe for reliable and secure communications. RIM services have withstood large-scale power outages, 9/11, Hurricane Katrina, and numerous other natural disasters. Kudos to RIM for standing in the face of opposition. Our hope is that RIM will not back down and enable back doors for surveillance such as those found in Skype clients distributed in China.

Just because the BlackBerry can be a tool for evil does not mean that its effectiveness should be compromised for the rest of the world. If some governments can’t live with that, they should go ahead with their bans.

…David Sengupta. In addition to his role as Ferris analyst, David is chief architect for Quest Software, and has been a Microsoft Exchange MVP since 1998.

Microsoft Outlook can be used to access email using the Internet Standard IMAP protocols, and the older POP protocol. In Outlook 2010, Microsoft made a number of improvements to IMAP support. Both the descriptions of what has been done and the extensive comment in this blog are interesting.

Broadly, IMAP in Outlook 2010 works reasonably, and performance against IMAP accounts feels slightly better than Outlook 2007. However, we have observed client hangs (needing product restart) and slowness interacting with IMAP servers.

The improvements to deletion, by moving messages to a “trash” folder on the server, are good. This deletion also works cleanly with Outlook rules set up to delete selected messages as they arrive.

The async download of messages is a good thing. It is a pity that they don’t also download the message structure so that the user can select attachments to download, which would be helpful with large attachments on a slow link. It is disconcerting to see a message start off without an attachment and then have the attachment appear later. There is a bug with calendar items, whereby you can only see the message as a calendar item the second time it is opened (after the attachment is downloaded).

For IMAP users, there seems to be a regression in using TNEF (the Microsoft internal format, that non-Exchange users see as “winmail.dat” attachments) rather than MIME, and it does not appear possible to suppress this for message forwarding as attachment and at some other times.

For use in a mobile environment, where links are not always as fast as they should be, it is a pity that Outlook is not making more use of advanced IMAP and LEMONADE features to improve the user experience.

IMAP support in Outlook 2010 has improved, but Microsoft could do very much more.

…Steve Kille. Steve is a periodic contributor to Ferris Research. He is also CEO of Isode, a messaging and directory server software vendor.

We’ve just been briefed by Clearswift’s new COO, Andrew Wyatt. It’s always a pleasure to hear from this firm. We have known them since 1995, when Content Technologies (the company that originally developed MIMEsweeper) became a client.

The technology has taken a lot of battering over the last 10 years. First it was bought out for $1 billion by Baltimore Technologies. We are not normally given to hyperbole, but in this case will make an exception. YES, AN INCREDIBLE $1 BILLION!!! This was at the height of the dot.com boom in 2000. The acquisition and its price made no real sense, but the price was naturally irresistible for the selling stockholders. The Baltimore merger was a great distraction.

In 2002 the technology was bought by NET-TEL, an X.400-based messaging firm, for a suitably post-crunch sum vastly less than $1 billion. The MIMEsweeper part of NET-TEL’s business was by far the most important, but the new owners took a long time to get fully behind their acquisition. That did further damage. Along the way, NET-TEL renamed itself Clearswift.

For the last three years, Clearswift has been focusing hard on its core MIMEsweeper business. Despite the numerous distractions of the last decade, many MIMEsweeper customers have stayed in the fold, so there’s been a reliable revenue stream. MIMEsweeper and Clearswift’s new Web and Email Gateway products are quite sticky, because of investment customers make in their custom-policy definitions. The main message we hear now from Clearswift is: “Content inspection is our core business and we’re 100% committed to it.”

Product line summary:

• Scans Web and email data streams
• Scans for spam, viruses, spyware, other malware
• Powerful and highly recursive policy definition language (mainly boolean logic plus regular expression matching) used, among other things, for compliance and data loss prevention
• Policy-based encryption, either through strong encryption or by standard password-based ZIP files
• Plenty of compliance filters provided
• Policy management system works across both Web and email channels

The technology is sold into organizations of all sizes, including very large ones. Nevertheless, its greatest success is with medium-size organizations, with 100 to 3,000 employees. As you’d expect, the company sells a lot through value-added channels, and has invested significantly to build out its channel and support programs.

Clearswift doesn’t disclose its revenues. Ferris Research estimates these at $40 million annually. A series of venture fundings allowed Clearswift to invest ahead of revenues for an extended period. We’re glad to learn that the company was profitable for the second half of the last fiscal year and plans to be fully profitable this year.

… David Ferris

Apple’s recent update to the iPhone operating system (iOS 4) contains some updates to the IMAP (the Internet Standard Internet Message Access Protocol) support. Details here. The RFCs now supported are:

• COMPRESS (4978)
• ESEARCH (4731)
• CHUNKING (3030)
• 8BITMIME (1652)
• ENHANCEDSTATUSCODES (3463)
• BINARYMIME (3030)
• CONDSTORE (4551)

These standards are also supported by Apple’s Mobile Me email service.

We have previously argued that mobile email will drive adoption of new IMAP standards, and in particular those defined in the LEMONADE Profile, described in Isode’s white paper, “LEMONADE Profile: The Key Standard for Mobile Messaging.”

This change has certainly not come as a revolution, but these developments in the iPhone suggest that these changes are coming gradually as an evolution and improvement. Support for two of these standards (both edited by Isode engineers) is of particular interest:

• CONDSTORE (described in the white paper) is a complex specification that is key to fast reconnect, which we have not seen supported in an email client designed for a mobile device until now. Thunderbird 3 supports CONDSTORE.
• ESEARCH (extended search) allows a client to efficiently search very large mailboxes. This is included in the second LEMONADE Profile, RFC 5550, and is not described in the white paper.

Since the LEMONADE work started, typical network bandwidth has increased significantly and so it is much easier to work without these extensions. However, use of these capabilities will improve performance for the end user, and differentiate iPhone email performance. LEMONADE capabilities will give a faster user experience, and will also reduce network traffic, which will improve battery performance and may reduce network usage charges.

We hope that this is the start of a trend for improved IMAP support in other email clients and mobile devices.

…Steve Kille. Steve is a periodic contributor to Ferris Research. He is also CEO of Isode, a messaging and directory server software vendor.

We ran into the Red Gate team at the recent Microsoft TechEd show and learned about the new release of Exchange Server Archiver V3. The major new change with version 3 is support for Exchange 2010. In addition, version 3 provides improved performance and a new simplified storage architecture.

Exchange Server Archive V3 continues its tradition of easy installation and simple operation. End users will like the Outlook interface, which displays archived email and attachments in their native format. Admins will like the easy-to-use setup, archive policy manager, and PST archiving tool. You can view product screen shots here.

Red Gate is targeting the small to midsize enterprise market (50-1,000 mailboxes) and pricing is very reasonable. For example, the price for 250 mailboxes according to the online pricing calculator is $5,597.50 plus support and maintenance.

Red Gate is perhaps a name you have not heard of in the crowded email archiving market, but we like the look of its technology and the overall product seems very well thought out. We recommend you take a look if you are in the market for email archiving. A free 30-day trial, with full technical support, is available as a download from the Web site, as well as online demos and webinars.

… Bob Spurzem - In addition to his role as Ferris analyst, Bob is director of product marketing at Permabit, which offers a grid-based disk storage system.

On June 22, 2010, Unify announced it would merge with Daegis, an e-discovery review firm. Here are some thoughts on the transaction:

• According to Kurt Jensen, CEO of Daegis, revenues for calendar years 2007/8/9 were approximately $16M, $21M, and $23M, respectively, with profitability consistently between 25% and 35%.
• Unify paid some $37M for Daegis. Of this, $24M is paid cash (debt financing from Hercules Technology Growth Capital). The balance is in Unify stock.
• This is a price/TTM revenue ratio of around 1.5. This strikes us as a remarkably low price. Todd Wille, Unify CEO, comments that “Daegis is receiving a significant portion of the proceeds in Unify stock which is perceived to be undervalued and represents tremendous upside to the sellers.” All the same, the ratio should please Unify shareholders.
• Corporate legal departments want to bring as much of the e-discovery work in-house as they can, because of the high costs of outsourcing this work. There is thus intense pressure on review firms to reduce their charges. Generally, expect plenty of case management firms to be acquired over the next couple of years.
• The strong profitability reported by Daegis is all the more striking given the price pressure. Partly this is because most of Daegis’ software is home brewed, not licensed. Daegis believes additional factors are the breadth of the e-discovery processes that its software encompasses, and the provision of high-margin professional services.
• In principle, Unify gains substantially by the merger:
  • Gets a position in the legal world, and the ability to market to the legal world.
  • Can get an interesting competitive edge by tightly integrating case management information and archiving. Such integration is hard and could end in tears.
  • It helps corporate legal departments bring more e-discovery work in-house.

… David Ferris

Unify is a database tools company that acquired archiving software vendor AXS-One in June 2009. On June 22, 2010, Unify announced it would merge with Daegis, an e-discovery review firm:

• Daegis has a matter review SaaS that culls down a corpus of ESI. It also provides manpower to plan the initial collection process and the actual review/culling.
• Unify’s AXS-One archiving software will be integrated tightly with Daegis’ DocHunter eDiscovery system.
• Unify’s archiving and e-discovery group will adopt the Daegis name.

Today, ESI archives are wholly separate from e-discovery systems. Data is extracted from the archive and put into an e-discovery system. Thus, the following types of information are normally not included in the archive:

• How valuable the material is for e-discovery.
• Who has reviewed the material.
• Who is the custodian of the material.
• Cases that have used the material.

In a novel step, Unify/Daegis plans to change all this. The archive will be enhanced so that it now contains e-discovery information.

Comments:

• Unify will now be able to offer technology plus a proven professional services team that produces relevant e-discovery material, all in one organization. That’s a significant differentiator in the archiving world.
• Unify will also be able to let general counsel bring much of the e-discovery work in-house. This would be extremely attractive to many organizations, due to the significant cost of outsourcing this work.
• The idea of building case management data into an archive is very interesting. E-discovery is now the major driver for archiving purchases, and e-discovery is very expensive. Adding case management information to the archive should, in principle, translate to substantially better searches, and substantial reductions in legal costs.
• On the other hand, e-discovery is simply one application of an archive. You could argue that an archive should be more application-independent.
• It makes sense to use the Daegis name. Daegis is known in the legal world, and e-discovery is a major driver for archiving; Unify’s name is only known in the database tools world.
• Integrating the AXS-One and Daegis code sets and data structures will be challenging, all the more so because Daegis’ system is hosted, while Unify’s software resides on the customer’s premises. Many organizations fail at such integration. The roadmap should be viewed with appropriate caution.
• Daegis staff have a lot of experience extracting material from archiving solutions. However, they have relatively little experience with AXS-One archiving. That may be a problem.
• It’s good to see Unify investing further in its AXS-One acquisition.

… David Ferris

Recently at the Gartner IT Infrastructure Expo in Orlando, I witnessed a seminal change in IT thinking. Nine out of 10 IT decision makers I spoke with told me that they have active general-purpose file archiving projects.

Hitherto, email archiving has been at the fore, with file archiving always on the back burner. The general thinking on file archiving was to just add more disk capacity.

The new emphasis on file archiving is driven by the total cost of disk storage. Disk hardware may be cheap, but the real cost is in disk management. Daily backup and provisioning can consume 50% of an administrator’s total time. Simply adding more disk capacity is too expensive.

The proper solution is to consider a true storage tier that is optimized for cost-effective, long-term storage. New storage solutions are being announced by all the leading storage vendors that include not only high-capacity SATA disk drives, but grid architectures for scalability without expensive provisioning, and object-based storage designs that are self-healing and do not require old-fashioned tape backup. And finally, data optimization (both compression and deduplication) is being introduced as a further means to optimize storage costs.

Archive storage will become a mainstream storage solution for all organizations by 2012.

… Bob Spurzem

There are many factors to consider when moving email and email archives to the cloud. Three important ones are:

• Do you presently have on-premise email archiving? If so, then you must consider how to move the email archiving storage to the cloud. The cost of this move can be considerable, in terms of load fees, disrupted user time, and support staff time.
• Do you plan to archive email in the cloud? If so, what archiving capabilities are offered by your cloud email provider? Will they meet your needs for e-discovery and mailbox management? What is the additional cost?
• Do you plan to postpone cloud email for two to three years, but begin email archiving now? If so, then consider how you will move potentially terabytes of email archives to the cloud later. You may wish to begin cloud archiving now to lessen the future impact.

They key factor to remember is the size of email archive storage. Even a couple years of email can be terabytes of storage. Moving terabytes of email storage from on-premise to the cloud is a formidable and costly task. Keep this important issue in mind as you consider the benefits of cloud email.

… Bob Spurzem

Nice bit of gossip arising from a London court case. It is said that:

• A British UK property developer was working with a partner (Middle Eastern royalty).
• They wanted to develop a part of central London.
• The UK’s Prince of Wales objected to the development, and contacted the partner.
• There’s a nice email record of the interaction.
• As a result, the partner backed out.
• The partner deleted the email correspondence with the Prince of Wales, so it wouldn’t have to pay around $120 million in compensation to the developer.
• The partner then lied to the UK courts about its reason for backing out.

More here.

… David Ferris

One of the new capabilities of Exchange 2010 is its expanded mailbox capacity. Microsoft asserts that it is possible to store years of email safely in Exchange 2010 without concern for mailbox size.

That may be true, but there is a potential problem with this approach.

What happens when you have to upgrade Exchange sometime in the future? Take, for example, the recent upgrade from Exchange 2003 to Exchange 2007. With this upgrade you had to physically migrate all mailbox content to the new server. It was a very time-consuming process, even for the much smaller mailboxes common with Exchange 2003. What happens if the same type of upgrade is required in a future version of Exchange, and mailboxes are 10GB in size (or larger)? The impact on upgrade will be huge.

This is something to consider if you are planning to greatly expand average mailbox size with Exchange 2010.

… Bob Spurzem, with many thanks to Martin Tuip, Exchange MVP, who raised this issue



Had an interesting conversation recently with someone close to the EAS/Zantaz/Autonomy on-premises archiving product. In summary:

• Support for EAS/Zantaz has become very poor since Autonomy acquired the product.
• It appears Autonomy has little interest in the product.
• However, an Exchange 2010 version is now available. The development efforts for this are nontrivial, so contrary to the prior bullet, that indicates Autonomy does have some interest in the product.
• Autonomy doesn’t provide product roadmaps, which makes it still harder to tell what’s happening with EAS/Zantaz.
• EAS/Zantaz is not strong in localization–notably searches that use non-English/American characters.
• It took Autonomy two years to make its Idol search work with EAS, but now it’s working well.
• Systems integrator Capex is hiring lots of people with EAS/Zantaz skills. Maybe they could purchase the product from Autonomy.

… David Ferris, with thanks to the contributor

A lot of Autonomy employees are very unhappy with the company. See these Glassdoor reviews, where employees share their experiences. Among other things, the culture appears to be one in which limited correlations between sales claims and reality are permissible.

Caveat: Embittered ex-employees probably form the vast bulk of contributors to sites of this nature, so the reliability of the data should be treated as highly questionable.

… David Ferris, with thanks to a financial analyst chum