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Five important strategies for Text Analytics vendors
Fern Halper By: Dr Fern Halper, Partner, Hurwitz & Associates
Published: 28th March 2007
Copyright Hurwitz & Associates © 2007
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Text analytics is a rapidly evolving market. Nimble new vendors are entering the space, incumbents continue to battle, and now technology giants are jumping in. The technology analyzes unstructured text, identifying and extracting the relevant parts and then transforms it into structured information to be mined and analyzed.

It is very compelling. Users of the technology that we've spoken to find it invaluable because it can analyze a previously untapped resource; unstructured data, such as that found in call center records or email systems. Nevertheless, this is still an early adopter/early maturing market. Smaller "pure-play" vendors in this space need to develop strategies that will help them survive or thrive amidst the growing competition. Here are five potentially beneficial strategies that we have identified—with notes on companies pursuing these strategies:

1. Partner with BI vendors
End-users we've spoken with don't necessarily need or want some of the analysis and visualization technology that the smaller pure play text analytics vendors are providing with their solutions. Some of their companies may have already invested in business intelligence software and would prefer to use that instead. Companies like Clarabridge understand this and allow their customers integration capabilities into virtually any business intelligence software. They also have partnerships in place with Business Objects, Microstrategy and Cognos. Other companies like Attensity have formed partnerships with business intelligence vendors such as Business Objects as well as database vendors such as Teradata.

2. OEM your software
Text analytics is an enabling technology, but it is not a one-size fits all kind of technology. Different vendors are good at different things. The technology is often part of the bigger solution. Companies such as Inxight and Teragram OEM their extraction capabilities to other vendors (both large and small) and are finding success in doing so.

3. Develop specific solutions
Typically vendors start by developing solutions in one area, such as warranty analysis or customer voice and then parlay that into a solution that can be sold more broadly. A number of pure-play vendors are offering specific solutions and they should continue to do so because end-users want and need this.

4. Consider the content itself
Content plays a huge role in text analytics since that is what companies are accessing and extracting information from. It is a logical step to integrate text analytics tools with content management. Recently, Nstein has solidified this direction with the acquisition of Eurocortex, a European content management provider and the company is already showing good success with the strategy, especially in the e-publishing domain.

5. Partner with search providers
Let's face it, companies relate to the concept of search. Even those that haven't heard of text analytics are thinking about implementing search. Enhancing search via partnerships with search vendors is a reasonable strategy. Some vendors are providing their own enhanced search solutions, as well. For example, Teragram provides a search solution called Direct Answers. Inxight offers a product called the Search Extender for Google Desktop.

Many vendors, including some of those listed here, are deploying multiple strategies. Clearforest, for example, offers its extraction capabilities as a component model, has a partnership with Business Objects, and has also recently announced a software as a service offering. Adaptability will be key in the near-term for these pure-play companies as they try to find solutions that will stick, and then wait for the inevitable consolidation.


Published by: IT Analysis Communications Ltd.
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