AUGUST 30, 2010

Compass Guide to WCM, Q3 2010

Evaluation of Day Software

By: Tony White

TABLE OF CONtENtS
Ars Logica Position Notes & Resources Vendor Overview Vendor History & Key Recent Developments Profile of the Ideal Customer Key Product Strengths Key Product Limitations Vendor / Product Report Cards Report Card Evaluation Criteria - Business Users Report Card Evaluation Criteria - Technologists 3 3 4 5 6 7 8 9 11 12

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Day CQ 5.3 Product Evaluation

By: Tony White Date: August 30, 2010

ArS LOGicA pOSitiON

Founded in 1993, Day has long been a technological visionary in the WCM market. Since the mid-90s the vendor has experienced extreme loyalty from IT departments under pressure to produce and maintain technically flexible Java enterprise architectures. From the outset, Day instinctively understood the need for Systems-Oriented Architectures (SOA), of which it was a pioneer. But lack of attention to business users requirements until 2008 caused Day considerable trouble. After introducing elegant new user interfaces, Day has begun to compete successfully against its market-leading peers.

NOtES & RESOurcES

Compass Guide Vendor Questionnaire Some company and product information contained in this report was collected via Ars Logicas 172-item Vendor Questionnaire. Vendor responses were always independently verified through customer interviews, implementation monitoring, Ars Logicas comprehensive knowledge base, and hands-on product testing. Hands-On Product Testing Ars Logica conducted hands-on product testing in January 2010 at Days U.S. headquarters in Boston, Massachusetts. Subsequent product updates supplement these results. Customer Interviews Ars Logica interviewed users of every product covered in the Compass Guide, including Day Software. Implementation Monitoring Since the 1990s, Ars Logica founder Tony White has kept close tabs on ongoing WCM implementations. Some of this knowledge is represented in the Compass Guide reports. No Vendor Influence Ars Logica retains complete editorial control over the Compass Guides and receives no funding in their production.

Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

Day Software Vendor Overview

Day Software is CMS vendor with headquarters in Basel, Switzerland, and Boston, Massachusetts, whose products have been at the technical forefront of Java development since the early 1990s. The companys commitment to the Java Community Process is evident in its heavy involvement in the establishment of industry standards such as JSR 283 and 286. Days particular strength in enterprise application integration has been of particular importance to IT departments over the years, and its November 2008 launch of dramatically improved user interfaces has proven successful among non-technical business users. Day has not always demonstrated consistent commitment to the U.S. market, but we believe that recent sales success has drawn that era to a close.

Company Profile
Year Founded: 1993 Headquarters: Basel, Switzerland; Boston, Massachusetts Employees (or FTE equivalents): 150+ Geographies: Global Revenue: 36.3 million CHF / $31.5 million Product Types Offered: WCM Commercial or Open Source: Commercial Strategic Implementation Partners: Acquity Group, Critical Mass, Logica, MRM Global, Sapient, Crown Partners Top Competitors: Interwoven (Autonomy), FatWire, SDL Tridion Media & Entertainment, Transportation, Financial Services Key Vertical Industries: Manufacturing,

Product Profile
Product Name: CQ5 Version: 5.3 Next version release date: Q1 2011 Market segment: Enterprise Average Sales Price (License Only): $250,000 Technology Platform: Java, OSGi Key Strengths: Leader in development of Java standards, flexible architecture, online marketing capabilities North American market (historically), recent success overextending key personnel and causing delays large Web presence with a focus on user interactivity, brand management, or retail

Key Limitations: Wavering commitment to

Highest-Value Use Case: Global deployment of

Copyright 2010 Ars Logica. All Rights Reserved.

Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

Vendor History & Product Evolution

Founded in Basel, Switzerland in 1993, Day Software is now the senior-most pure-play WCM vendor in the market. [This statement does not account for Adobe Systems recent agreement to acquire Day Software.] A dubious distinction, depending on ones goals (to make the best technical product, to be acquired, to achieve sustained organic growth, et al.), but from a technical point of view, the companys early architectural vision and sustained dedication to Java development make the distinction both meaningful and rare. An old story by now, the best technology is not always applied to the markets most pressing business problems. This was true in Days case to an unusual degree. In 2006, the company finally decided to invest in a complete metamorphosis of its user interfaces, and in November 2008, the result suddenly made the CQ platform relevant and interesting to business users. From November 2008, it took Day just over 12 months to market the platform effectively. The company had been so thoroughly steeped in its IT-only view of the world, that even with what were in early 2009 among the best interfaces for non-technical users on the market, its marketing and sales teams could still not transition to selling to business buyers, who by then were controlling the purse strings for most IT purchases. At least 12 wasted months for sure, but it seems as though Day has now recalibrated. Since Q1 2010, Ars Logica has witnessed a change from a near absence a year earlier in enterprise-level competitive sales situations to presence in something approaching 30 percent of the deals where the product would be a potential fit. The reasons are two-fold: (1) the new user interfaces, and (2) more seasoned marketing and sales management with an understanding of how the North American market works.

Key Recent Developments

[As this report was in final editorial review, Adobe Systems announced its plans to acquire Day Software.] From an analysts point of view, the most significant change at Day Software is the dramatic increase in how often the vendor appears on CMS buyers shortlists. Technically, the product has been excellent for more than a decade, and in late 2008, its usability for non-technical users went from lackluster to good. From Q1 2009 to Q1 2010, the only reason Day did not compete more effectively against other market leaders was the inertia behind the markets perception of CQ as too complicated for business users. To be sure, reversing this trend has not been an easy task for Day. Changing that much negative momentum never is. But Ars Logica is happy to see that closer alignment between CQ 5.3s technical prowess and the quality of its user interfaces is finally being rewarded by enterprise WCM buyers. We expect Day to continue to gain market share for the rest of 2010 and into 2011.

Copyright 2010 Ars Logica. All Rights Reserved.

Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

Profiling the Ideal Buyer

Until the beginning of 2009, the ideal buyer of CQ was an IT department under pressure from business units to supply a highly scalable WCM platform while simultaneously integrating it with myriad other enterprise applications. While these IT departments are still primary targets for Day Software, business units have begun to welcome the new look-and-feel and the smooth integration between the WCM and DAM modules of the product. Consequently, non-technical decision makers are accounting for an increasingly large percentage of the vendors sales, and most of these are medium-sized to large companies with enteprise-wide implementation requirements and a firm commitment to Java as a development language. Medium-sized to Large Companies with Enterprise-Wide WCM Integration Plans Because of its price and technical sophistication, CQ 5.3 is best suited primarily to medium-sized and large companies looking to implement and integrate a WCM platform with a wide range of enterprise applications. Companies with Complex WCM Requirements and Abundant Java Development Resources The technical flexibility of the product make it ideal for companies with especially complex or unique integration requirements. Such integration necessitates abundant Java development skills, but Comminiqus APIs and SDK provide a development platform that is among the best on the market. IT Departments Seeking Extreme Architectural Flexibility and Best Overall Technical Ratings The foundation upon which CQ 5.3 is built has in its lineage a Content Bus whose application integration capabilities alone caused companies to buy the platform. These capabilities have gotten even better over time, and now represent the ne plus ultra of architectural flexibility.

Day Will Not Be a Good Fit, If...

Obviously, enterprises with loyalties to .NET and PHP (and to a more limited extent, open source) would probably do better to consider other options. CQ 5.3s extreme integration capabilities do not make the product an impossibility for such companies, but a substantial pool of Java developers will be required under any circumstances. The cost of the product will also prevent some customers from considering CQ 5.3. Although not a bad value, a median sales price of $250,000 and implementation costs of another $250,000 bring the price of a typical CQ 5.3 deployment to approximately half a million dollars.

Copyright 2010 Ars Logica. All Rights Reserved.

Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

Key Product Strengths

Due largely to the technical flexibility of the product, CQ has long been a favorite CMS platform among IT departments. Going back more than 10 years, Day itself has taken an application development approach that prizes flexibility above all else. In this regard, Day has been a pioneer in Services-Oriented Architecture or SOA, which, in brief organizes discrete features and functions within applications into services that can be combined, integrated, and reused throughout the enterprise. Day began building Communiqu (now CQ) largely in accordance with these principles in the early-to-mid 1990s, about ten years before they gained widespread acceptance in the marketplace. Day did not get proper acknowledgement for its technical vision, for two reasons. First, it was ahead of the market. And second, it did not develop provide business users sufficient ease-of-use until late 2008. Only in 2010 did CQ5 really start selling to CMS selection committees headed by business units, but it has since done so very strongly. Since its founding in 1993, Day has been more involved than any other CMS vendor in the Java Community Process. It has been a major contributor to several Java standards such as JSR 283 and 286. Although there are other vendors whose platforms are purely Java-based, Ars Logica can think of only one other (Magnolia Software) whose commitment to Java development in general is as strong as Days. Consequently, Days customers have for a long time benefitted from one of the largest, most diverse, vendor-specific Java development networks in existence.

FiGurE 1 Day CQ 5.3, Key Product Strengths and Limitations

Below are several key product strengths and limitations that potential buyers should keep in mind when assembling vendor shortlists. KEY STRENGTHS
Superb technical flexibility Highest overall rating on the Report Card for Technologists (see Page 10) Well-integrated WCM and DAM modules Industry leader in development of Java standards

KEY LIMITATIONS
Relatively poor performance in competitive sales situations until recently Historical lack of commitment to U.S. market Micro-management of the company sometimes hampers relationships with customers, partners, and analysts

Source: Ars Logica, Inc.

Source of Information: Product testing (January 2010), customer interviews, Vendor Questionnaire

Copyright 2010 Ars Logica. All Rights Reserved.

Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

Aside from strictly architectural and Java-related details, Day has done the most seamless job we have seen of integrating WCM with DAM. When companies purchase both modules, it isnt really necessary for their business users to know that they are switching back and forth between the two. This is unusual -- and usually good -- for an integrated WCM-DAM product. Lastly, we think it is worth pointing out that Days overall score on the Report Card for Technologists is higher than any other vendor in the Enterprise, Commercial category (see the Product and Company profile sections on Page 4). This results from excellent performance in the flexibility category and very strong showings in the scalability, development tools, and ease of administration categories.

Key Product Limitations

Until the beginning of 2010, Days reputation as a product too complex for business users significantly impeded its ability to compete in large enterprise deals -- not least because purchase-decision authority within enterprises has shifted from IT departments to business units. Given Days lack of attention to the usability requirements of non-technical users until the end of 2008, it comes as no surprise that this reputation would limit the vendors sales performance until just recently. Only now is Day reaping the benefits of the overhaul of CQ 5.3s front end, and Ars Logicas research suggests that Q2 2010 witnessed dramatically improved sales performance due to heightened market awareness of the products improved usability. Secondly, some still worry about Day Softwares long-term commitment to the North American market. Ars Logica believes that this should now be of no further concern. Prior to 2008, however, there was significant cause for concern, as in 2000, Day established its U.S. presence in Newport, California, and in short order fell on very hard times. But with recent investments in its sales and marketing organizations -- along with the revamping of the product -- Day has begun to do quite well in the U.S. Ars Logica now sees Day frequently competing against other market leaders. Finally, Ars Logica believes that micro-management at Day from the highest levels of the company has hampered relationships with customers, partners, and analysts. Although such corporate cultural issues always prove difficult subjects, Ars Logica has seen numerous examples of promises made and broken by managers and executives hamstrung by after-the-fact managerial oversight. We believe that this has largely been due to a lack of understanding by Swiss management of North American sales and marketing realities. Ars Logica hopes that this unfortunate era for Day Software is over. In light of recent and dramatic improvements, we are cautiously optimistic that it is. We will give an update on this topic in the next release of the Compass Guide.

Copyright 2010 Ars Logica. All Rights Reserved.

Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

Vendor/Product Report Cards

The features, functions, and technical underpinnings of WCM products vary wildly, as do the customer requirements they are intended to satisfy. For this reason, the only reliable way to assure the best product fit for a particular client is to spend anywhere from several weeks to several months assessing the clients specific needs and analyzing product capabilities line by line. Still, Ars Logica is frequently asked to rate products in categories such as those in Figures 2 and 3. In using these ratings, please take care not to compare products in different market segments (see the Product Profile section of Page 4). For example, a Scalability score of 9 for an Enterprise product does not equate to the same score for an Entry Level product.

FiGurE 2 Day Software Report Card for the Business User

Figure 2 shows Ars Logicas rating of Day CQ 5.3 in four categories of critical importance to business users. Refer to Page 11 for an explanation of the evaluation criteria.

Usability 10

Marketing & Sales Tools

Multi-site, Multi-channel, Multi-lingual

Market Presence, Product Viability

7.5

7.7

7.5

7.0

Source of Information: Product testing (January 2010), customer interviews, Vendor Questionnaire Copyright 2010 Ars Logica. All Rights Reserved. 

Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

FiGurE 3 Day Software Report Card for Technologists

Figure 3 shows Ars Logicas rating of Day CQ 5.3 in four categories of critical importance to technologists. Refer to Page 12 for an explanation of the evaluation criteria.

Scalability 10

Flexibility

Development Tools

Ease of Administration

8.9 7.9

8.1

7.1

Source of Information: Product testing (January 2010), customer interviews, Vendor Questionnaire

COLOR KEY

SOLIDS

GRADIENTS

10

Copyright 2010 Ars Logica. All Rights Reserved.

Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

Report Card Evaluation Criteria

In the process of analyzing WCM solutions, Ars Logica has established a set of evaluation criteria, which at the highest level can be separated into four categories for non-technical business users and four categories for technologists. Scores in these categories represent averages of a large number of detailed criteria, and are meant to be used as a means of quickly comparing products within the same market segment -- not as a substitute for painstaking requirements and product matching.

Criteria for Business Users

Usability Usability refers to the relative ease of learning and using a WCM application. For non-technical business users, factors contributing to high scores in this category include intuitive and consistent user interfaces, streamlined task completion (i.e. minimal number of steps to complete a task), integration with the desktop, contextual editing capabilities, and documented high user adoption rates among a vendors customers. Marketing & Sales Tools Increasingly, enterprises are relying on marketing and sales tools within WCM applications to improve sales conversion rates, increase average transaction amounts, draw customers back to their Web sites, analyze online behavioral patterns, and so on. This category rates the presence and quality of such tools. Multi-Site, Multi-Channel, Multi-Lingual Capabilities This category assesses a products ability to support multiple sites; deliver content to multiple channels on multiple devices; and create, store, present, disseminate, and/or translate content into multiple languages. Scores in this category represent an average of a products capabilities in all three of these broad functional areas. Market Presence, Product Viability The Market Presence, Product Viability category rates both a vendors overall market presence relative to competitors and its dedication to the continued development of its WCM products. If these two factors are not aligned with each other, an explanation of why will be included.

Copyright 2010 Ars Logica. All Rights Reserved.

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Compass Guide to Web Content Management Day Software CQ 5.3 Product Evaluation

Criteria for Technologists

Scalability Scalability refers to the ability of a product to function well as system demands increase. Factors contributing to scalability are database size, query efficiency, bandwidth consumption, ease of system management, caching efficiency, load balancing, and mass content deployment capabilities. Flexibility Flexibility denotes a products ability to integrate easily with existing enterprise infrastructure, including operating systems, Web servers, databases, directories, development tools, and other enterprise applications such as ERP , CRM, document management systems, search, portals, and so forth. Development Tools This category describes the quality of a products integrated development environment (IDE), the technologies that the IDE incorporates, and overall ease of customized application development. Although this category refers primarily to development frameworks (Eclipse, e.g.), other ad hoc tools are also included, such as page templates, HTML/XML editors, WYSIWYG editors, PDF generators, and any other software that enables or eases the production, formatting and dissemination of content. Ease of Administration Some WCM products require significantly more work to administer (sometimes 5-10 times more) than others. This category rates the relative resource intensity required to keep the system running smoothly, where higher scores reflect less work. Roughly speaking, higher scores also indicate better coordination of application components due to more methodical system design.

12

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SErvicES
Advisory Services Ars Logica is a vendor-neutral analyst firm helping companies evaluate their WCM requirements and select appropriate WCM software. To address clients content management-related questions and problems that arise throughout the year, Ars Logica offers unlimited direct analyst access through its Analyst Anytime advisory services. These annual, subscription-based services provide guidance by phone or email within 24 hours on a wide range of issues. The number of inquiries submitted throughout the year is not limited.

Contact
Tel: +1 617 .943.5611 Fax: +1 617 .226.4575 75 Arlington Street Suite 500 Boston, MA 02116 www.arslogica.com

Software and Technology Selection In our Software and Technology Selection engagements, Ars Logica maps clients functional, technological, and strategic requirements to potential WCM solutions and identifies the software vendors whose products best satisfy these requirements. We maintain a continuously updated comprehensive matrix of the feature-functionality of most WCM vendors products and solutions. We also receive frequent briefings from these vendors and have in-depth conversations and consulting engagements with their customers, ensuring that we always understand the actual state of vendors offerings as well as their forward-looking strategic directions.

Custom Engagements Ars Logicas expertise in WCM and related technologies such as digital asset management, records management, marketing campaign management, search, and portals, gives us the open-ended ability to help clients on a wide range of projects, including: building the internal business cases, assessing technology requirements, analyzing software products and vendors, selecting and assembling software solutions, crafting Web strategies, and running corporate educational seminars. We also assist vendors in developing strategic roadmaps, and we and present our view of the WCM market at industry conferences and end-user events.