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Andrä’s Open-Source Strategy a Potential Game Changer for CMS
Posted by Benjamin B. Sargent on March 17, 2009  in the following blogs: Technology, Translation and Localization
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Small software companies with expensive, complex, enterprise-class software struggle to find effective, cost-efficient marketing strategies they can afford to implement. One challenge is that marketing efforts may draw the interest of buyers that don't match the target profile. These companies don't have staff to answer phone calls from ill-matched prospects that won't, in the end, buy their products. (Yes, marketing can be dangerous for companies seeking a small number of highly suitable customers.) One such company we track, Andrä AG in Germany, appears to be on the verge of an unusually daring marketing play. It's a gambit that looks to us like open-sourcing-as-OEM-strategy.

Many product developers use "original equipment manufacturers" (OEMs) as a sales channel to increase distribution and market share. This works in the software sector just like in automotive or in any other manufacturing industry; companies seek to place a licensed sub-component into the finished products of other manufacturers. In this case, Andrä would make its segmentation and matching engine (the core technology behind translation memory) available to document and content management software vendors for inclusion in their solutions.

Andrä's idea is not limited to OEM, because end users would also be able to adopt the component for use in bespoke systems development. But the OEM aspect, if it works, is a potential game changer for the content management system sector. This approach is fundamentally different than the Welocalize GlobalSight open-source initiative. The GlobalSight offering grants an end-user license to deploy and use a complete, self-standing translation management system. Here, the business management, workflow, and language tool functions that comprise Andrä's translation management system (TMS), called "Ontram," will not be open-sourced.

Even Ontram's many file filters – the parsers for filtering content in and out of various formats, which we consider a strong suit of Andrä's TMS – would not be on offer as open source. In the specialized context of a content or document management system, Andrä's TM engine would process XML segments natively with no need for parsing.

We regularly hear from content (CMS) and document management system (DMS) vendors how "multilingual" has become a  business requirement for their customers. More and more companies see immediate benefits from applying translation memory earlier in the content lifecycle. In the TMS world, this means running content against a TM before it goes out to the translation vendor. In the authoring world, earlier in the cycle means running new copy against a TM before the editing step, in order to upgrade fuzzy matches to perfect matches, which reduces the cost of editing as well as the obvious downstream savings in translation costs.

Thus, companies across Europe and North America are spending significant amounts of cash and resources connecting up CMS and TMS systems. Software vendors would greatly reduce that effort and cost by shipping their systems with an embedded TM component – one that works out of the box. So that explains why the platform vendors will be interested in Andrä's offer. But questions abound:
  • Will Andrä's TM data formats fluidly inhabit and transport between multiple systems?

  • Will this "embedded TM function" become a must-have component for content and document system vendors?

  • Will a user community arise outside of Andrä's core customer set, enough to overturn the de facto standard for TM?

  • Can the open-source play be judged a success even if the answer to the above questions is "no"?
We think the answer to this last question is a qualified "maybe." We see several ways the company will benefit even without taking the CMS world by storm:
  1. Custom development services. Andrä already makes roughly 80 percent of its revenue from services, much of that from custom development. If the strategy works, it would put the company in line for an enduring stream of service engagements – both from software vendors and from end-customers.

  2. Fee-based software licensing. Any CMS customer that takes advantage of a translation memory capability embedded in its content management application is a potential buyer of software add-ons purchased directly from Andrä. These additional components, including the Ontram TMS, would not be free.

  3. Fame and bragging rights. Andrä is a small company with only a tiny budget for marketing. If this novel approach works, then CMS vendors and their employees will learn about the company and promote its other offerings, including the parsers and TMS.
Can Andrä earn enough revenue from a small base of very large customers? All of these high-demand enterprises already use content management, document management, digital asset management, and/or product information systems. With this strategy, Andrä targets any integrator or user that takes advantage of a core TM technology delivered inside the guts of those systems. The open-source gambit is a Trojan horse tactic to initiate a relationship with those companies – with a near-zero outlay for marketing.

Although the company has so far kept its secrets, we see the unfolding strategy as bold and compelling. This is not a “boneyard” strategy for an old, retired piece of code, but an innovative distribution strategy for core technology that is just now reaching its prime. We encourage Andrä to move ahead with the proposed offering without further delay. It will take most CMS and DMS vendors a year or longer to write this into their product roadmaps, but when they do, a great number of end-customers will benefit. And for Andrä, if it works, this OEM-like strategy could draw a slow but steady trickle of qualified prospects – without raising the company’s profile so much that its phone rings off the hook. And that would rate a marketing success, even if world domination eludes this particular software developer.

 

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Keywords: Computer-assisted translation, Localization, Translation, Translation management systems, Translation memory, Translation technologies

  
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