News / July, 2016

Mass extinction predicted for enterprise file sharing vendors

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By Doug Woodburn, CRN

Standalone enterprise file synchronisation and sharing (EFSS) vendors are facing an apocalypse, according to analyst Gartner, which forecasts that 70 per cent will cease to exist by 2018.

The analyst made the apocalyptic prediction as it unveiled its latest EFSS magic quadrant, which evaluated 13 standalone or ‘destination' EFSS vendors and labelled four - Box, Citrix, Dropbox and Egnyte - as ‘leaders'.

However, only a minority of the 40 or so players in the market will still be around in 2018, with commoditisation in the space set to drive dramatic consolidation over the coming 24 months, Gartner predicted.

Within two years, some 30 per cent of EFSS destination vendors will be acquired by other players and absorbed into adjacent markets, with another 40 per cent going out of business, Gartner predicted.

The remaining 30 per cent will evolve into different product areas, the market watcher added.

Gartner defines EFSS as a range of cloud-based or on-premises offerings that enables individuals to synchronise and share files - such as documents, photos and videos - among mobile devices and PCs.

EFSS as a concept burst onto the scene in 2010 in response to consumerisation trends and shadow IT threats, Gartner said. Rival analyst IDC expects the overall file sync and share market to be worth $2.3bn by 2018.

Gartner carves the market into destination players - which offer standalone products with file sync and share as the core capability - and extensions, which are EFSS features added to established products. There are more than 100 EFSS vendors in total, with 40 per cent selling EFSS as a destination offering, the analyst said.

The value of pure EFSS destinations has been diminished by increased competition from big-name vendors such as Microsoft, Google or IBM who bundle EFSS products or features in their offering, Gartner said.

As EFSS features continue to be added to products in many markets, commoditisation will progress, driving the shake-out of EFSS destination players, the analyst explained.

Gartner said its EFSS Magic Quadrant would have to be redefined next year as the surviving destination vendors transform their EFSS products into broader suites.

This trend will spawn two new markets in the form of ‘modern content, collaboration and workflows' - a category that will house the likes of Box, Dropbox and Intralinks - and ‘data infrastructure modernisation' - which will encompass the likes of Egynte, Syncplicity by Axway and Citrix, Gartner said.

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