RE: Will your chosen CMS vendor go bust?

Hi James - hmmmmm - have been quiet for a while - but afraid that gonna have to reply to this one.....
 
The first comment is more an addition to the point you make which I agree with......
"Gaining access to the CMS source code, either via open-source or vendor licensing" - many vendors also subscribe to ESCROW agreements whereby the intellectual value of the source is protected, but in the event of 'going bust' - the source code is released to the customers that have subscribed to it. The source is held by an independany organisation so it is beyond the influence of the vendor.
 
Not sure I agree with a number of points you make in the rest of the article though.......
I was interested to read your comment on "Recognising that the CMS purchased is likely to only have a 2-3 year lifespan" - whilst I agree with it as 'allocate the cost of ownership over three years' as a means to apportion the cost of ownership - I do not agree with it as a 'risk management strategy', CMS is a long way from being seen as an 'FMCG' product which is what you appear to be suggesting....surely the trick is to find a vendor that is stable and pushes the product forward at a rate that does not necessitate preparing for armageddon. In my view is sends the wrong message to the market to suggest to customers that they should be thinking in terms of their vendors going bust and also in terms of thinking of 3 year replacement cycles. Your paragraph on "Better Risk Management Approaches" simply seems to be saying they are all just as likely to go bust - so spend as little as possible and make sure you have the source code - which is simply not a true reflection of the marketplace - but please correct me if I have interpreted the paragraph incorrectly.
 
There are many names in the industry that have been around for a long long time - a number approaching 15 years - or five replacements if they had assumed a 3 year replacement cycle. Thats a pretty low risk for a customer who bought a solution from one of them 15 years ago.......
 
In my experience, customers who purchase CMS solutions that then go bust or stop developing the solution - usually made the decision based largely on cheapest price - and they do so knowing the risk of the solution not surviving in return for the low cost. As you correctly highlight - with every 'Tom, Dick and Harry' launching a CMS and using a variety of sales strategies to penetrate a crowded market (price being the most popular to 'overcome' the obstacle of the fact that they have few customers or few references) it is likely that a solution with no customer base, a single market, a shorter 'death' in terms of 'going into debt : going bust' ratio etc etc is a very risky strategy.
 
Solutions that have a wide customer base, a good brand name that have gone bust in the past have been quickly absorbed by other organisations and given new life - thus protecting the customer - a point which alas argues in favour of the 'larger CMS vendors' and away from the 'spend as little as possible' solutions - in fact I am struggling to think of a solution that had a large customer base that has disappeared (?) You are correct that technology does refresh and re-invent itself every so many years as the generic CMS product goes from its revolutionary phase to more of an evolutionary one - but again I would argue that the larger vendors are in the better position to change - how many developers can a small CMS provider throw at a product - given that the revenue it generates is equally as limited (if I follow your price argument). The moment the CMS stops selling or is costing too much to maintain - its history - along with the company - as at that level there are few takers interested in absorbing the debts to purchase e.g. the customer base. 
 
Maybe also woth considering is the fact that most of the '1000's of solutions that are sold on the market are not 'pure play' vendors but web design agencies that market their CMS alongside services - these are arguably factors that represent a greater risk to the customer as their business is not a committment to CMS as it is with a 'pure play vendor' that does nothing but CMS. If a company's existence is based on a product suite they are far more likely to protect and maintain it than if it is 'additional income'.
 
To pick up on another point you make "Spending less money, thereby directly limiting the financial risks." - this is simply in accurate and makes the massive assumption that a customers CMS solution only has a cost represented by how much it was to buy. It totally ignores the value that many CMS solutions are providing within an organisation - if a CMS is cheap and I use it to drive my online sales - and that vendor goes bust so that I can no longer update my website or enhance the product. or fails and I cant get support - or have to replace it with another (presumably cheap 3 year cycle) product - then the costs are HUGE and far reaching. For the reasons given above - a product from a large vendor is less likely to suffer the same fate and force the same costs (its also worth noting under the same paragraph that looking at the 'got that feature' of products today and comparing across products is not an effective method of finding comparative products for the future. I can think of one CMS solution that would have compared favourably to our own three years ago - but it has taken them three years to release a 'half' major release compared to the 3 major releases (6 half releases) over the same time period we have launched. Whilst our own customers have enjoyed successive major enhancements to the CMS products -  the competitor customers have had to wait three whole years (or the CMS lifespan to use your phrase) - but of course at the time they would have spent less on the competitor product ;-)
 
As an add-on to that point - its also worth adding that the contractor market generally take the time to skill themselves up in CMS solutions they believe they can market their skills for - so if a larger vendor does go bust the customer is far more likely to be able to resource skills to at least transition a move if not avoid it. This is simply not an option for smaller CMS solutions.
 
I would add though that given the number of competitors trying to break into the CMS market with none of the above - How likely is it that a CMS launched today will make it to the same market position of the larger vendors ? How likely is it that a CMS launched today will even be able to gain a significant foothold in its own domestic marketplace - let alone go international to be able to service the mid to large mutlinationals? I would therefore argue that a cheaper CMS solution with no customer base and lack of resources to back it is far more likely to require replacing in three years than that of an established provider - so maybe this is a risk that the cheaper solutions carry - but not the more established ones ?
 
Whilst it might seem that the above is advocating that everyone should ONLY 'buy from a large vendor' that is not the case - but since the article seemed biased towards 'go cheap' thought it might be worth putting across some of the other arguments as well.....
Regards
Steve Williams
RedDot Solutions UK
 

________________________________

From: [email protected] on behalf of James Robertson
Sent: Wed 05/10/2005 10:56
To: [email protected]
Subject: [CMS] Will your chosen CMS vendor go bust?



Hi all,

One of the articles I've published this month might be
of interest to this list:

* Will your chosen CMS vendor go bust?
   http://www.steptwo.com.au/papers/cmb_vendorbust/index.html
   One of the greatest fears when selecting a new CMS is that the
   vendor will go bust, but more must be done that just purchasing from
   a 'big' vendor and hoping for the best.

I would be very happy (as always) to receive feedback
or comments...

Cheers,
James
-------------------------
James Robertson, Managing Director
Step Two Designs

Email: [email protected]
Web: www.steptwo.com.au
Phone: +61 2 9319 7901


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