Microsoft SharePoint could be a $2 billion business

It's no secret that SharePoint is a widely used content management and collaboration tool. Nor is it surprising that people have strong feelings about the Microsoft platform on both ends of the spectrum. But would you be surprised to learn that SharePoint is one of Microsoft's billion dollar businesses?

It sure surprised me. I knew it was popular, but I had no idea just how lucrative.

Show Me The Money
Mary Jo Foley, Microsoft writer extraordinaire, wrote a piece for Redmond Magazine recently called "What is Microsoft's Next Billion Dollar Business?" In it, she speculates about what areas inside Microsoft might be good candidates for the billion-dollar club. As I read the article, one point, which I found in the third paragraph, stuck out immediately:

"Meanwhile, SharePoint is well on its way to becoming Microsoft's first new $2 billion business."

If true, that's astonishing, especially when Gartner predicted as recently as 2007 that the entire enterprise content management space would reach $4.2 billion by the end of this year. In fact, in 2009, Gartner reportedly placed the value at just $3.3 billion, probably making that earlier prediction a bit optimistic unless it was combining ECM and WCM. While you chew on those numbers, consider this: The most recent Gartner Magic Quadrant for Web Content Management report stated that the entire WCM market would surpass $1 billion for the first time this year. Now, I'm the first to admit that predictions are not necessarily always accurate, but for the sake of argument, let's assume all of these figures are at least in the ball park.

Double or Nothing

SharePoint does a lot of different things, so it's a hard product to pigeonhole into a given market category. They dabble in records management, some collaboration, some pure content managing and some web content management. But when you figure that Gartner is setting the entire web content management market value at half of what Foley is reporting as the approaching value of SharePoint alone, it's staggering. Am I the only sitting here thinking: "Wow!"?

No Wonder Finn is Happy

You may recall that I interviewed Microsoft director of SharePoint Christian Finn last June, and reported he appeared rested and relaxed. Why wouldn't he be with numbers like those in his hip pocket? People can criticize SharePoint--in some instances rightly so--but say what you will, those are impressive figures.

It's no wonder that other enterprise content management vendors both fear and embrace SharePoint. It's hard to argue with its sheer presence in the enterprise, and other vendors would be foolish not to try to piggyback on Microsoft's success in the space. Everyone from EMC to Open Text to Oracle (and much smaller players too) have products to connect to and work with SharePoint. As Finn once called the love-hate relationship with competitors in a 2009 interview with FCM, it's 'coopetition,' a term he used to describe companies that might compete with SharePoint on some level, yet still provide ways for their products to work with SharePoint.

Whether you're a friend or foe of SharePoint, if these numbers are to be believed, Microsoft is an even more formidable force in the content management market than previously believed. You don't have to like them, but you certainly have to respect their position. - Ron

NOTE: Don't forget to check out our recently published eBook on SharePoint 2010