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Analyst calls Lotus' strategy a messaging misstep

IBM Lotus is disputing an analyst's assertion that its Workplace product line will cause Big Blue's messaging market share to tumble.

IBM Lotus defended its Workplace Messaging software this week after a critical analyst report called its strategy "ambitious, yet confusing."

The Radicati Group study said that the converging roadmaps for Domino and the open standards-based Workplace product line will cause IBM to lose market share in the corporate e-mail arena over the next four years.

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Article: Workplace a work in progress

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"It is a very confusing strategy," said Sara Radicati, CEO and president of the Palo Alto, Calif.-based messaging research firm. "They show slides and slides of special product lines and never tell you specifics because they say they are working out the specifics."

Radicati called Lotus' plan a "desired roadmap" that is based completely on trust.

"They are telling customers 'trust us, trust us,' which is all very nice, but I doubt you would spend millions of dollars that way," Radicati said.

According to the Radicati report, by year's end Domino will have 24% of the e-mail market with 85.9 million mailboxes, and Workplace is expected to account for only 1% of the market, or 3.7 million mailboxes. The study said Microsoft Exchange has the heaviest market penetration.

"We are seeing a lot of concern about Notes and Domino. [Users] want to know what's going to happen to those [applications]," Radicati said, adding there has been "very little enthusiasm" from customers regarding Workplace.

The Lotus position

Ed Brill, a senior marketing manager at IBM Lotus, said Lotus Workplace was never designed to get existing users to migrate away from Domino and Notes.

"Workplace at its current point is targeted at new situations … at customers who never had e-mail before [or want a low-cost alternative]," Brill said.

Workplace Messaging, which was first released last May, was designed to provide the capabilities of Notes/Domino with new foundations and interfaces, according to Brill. Messaging is a component of the Lotus Workplace suite, a set of customizable products that also consists of collaboration, e-learning and Web content management.

Products like Workplace Messaging are intended to work with a company's existing e-mail infrastructure, route mail and allow administrators to manage users with an existing Lightweight Directory Access Protocol (LDAP) directory.

"In the meantime, we are not forcing customers [to switch], having just shipped Notes v6.5.1 and today going to beta with Domino 7.0," Brill said. "We are actually shipping updates to show that customers can continue on the same path."

Not an e-mail replacement

Manulife Japan was the first customer to implement Workplace Messaging after building its Web portal, called ManuTouch, on Domino, according to the company's assistant vice president of information systems, Guy Mills.

Mills said Workplace was used because Manulife needed an inexpensive, lightweight e-mail client for employees who were traveling, working from home or from customer locations.

"We were in a situation where we had employees who did not have company computers, but wanted to produce e-mail on a system they had control over," he said.

However, Mills said the 3,600-person Manulife Japan sales force will be the only segment of the organization that will implement Workplace. Manulife will forgo a company-wide deployment because it does not believe Workplace is the right fit for larger companies' business models.

Despite Radicati's report, IBM said it's picking up new e-mail customers. Big Blue reported 15% growth in Domino deployments in the first quarter of this year versus the same period in 2003 and said it now has 320 customers using at least one component in the Workplace suite.

"We believe we have a unique offering … competitors are scrambling to put together something similar [to Workplace]," Brill said. He added that Workplace will remain competitive as organizations look for search, content managing and instant messaging software from a single supplier.

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