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Enterprise file sync and share expands in 2014

The crowded enterprise file sync-and-share market is poised for change, as functionality increasingly becomes a feature of larger products, analysts predict.

Enterprise file sync and share is so hot that the market has attracted more than 100 vendors. The market is changing as 2014 ends, however, with file sharing spreading across a variety of products.

Industry analysts predict the days of standalone products are numbered. They say file sync and share increasingly will become a feature of enterprise products, with the occasional exception of specialized offerings catering to key functionality such as security.

"In the short term, enterprises will need to look at these individual products but treat them as more tactical than strategic because the market is changing very quickly," said Charles Smulders, managing vice president at Gartner Inc. "It could well be that in two or three years' time they will be getting their file sync-and-share capabilities from another vendor as part of a broader portfolio."

Gartner whittled down its enterprise file sync and share (EFSS) product list from more than 100 vendors to 19 for its latest magic quadrant, which was released in July. Leading the way were EMC's Syncplicity, Citrix's ShareFile, Accellion and Box. The top challengers were Dropbox, Microsoft, Google and IBM. Gartner's magic quadrant also included Acronis, AirWatch, Alfresco, Egnyte, Hightail, Huddle, Intralinks, Novell, ownCloud, WatchDox and Workshare.

"Everybody is coming after this from every angle," said Terri McClure, a senior analyst at Enterprise Strategy Group (ESG). "The storage vendors, the backup vendors, the gateway providers and the unified communication vendors are selling it. The enterprise content management folks are building sync-and-share functionality into their platforms. I don't think there's any market segment that touches the file environment that doesn't have entrance in this market."

Other storage and backup vendors in the EFSS mix include Code42, Ctera Networks, Hitachi Data Systems, HP (through partners), NetApp (through a connector strategy) and Nasuni. McClure said file sync and share has gone beyond just storage, however.

"The market has matured way beyond being a storage solution," she said. "And we're seeing pricing strategies that reflect that because the value in these products is in the access and sharing functionality. For business users, these solutions have tremendous potential to enable collaboration and workflow and really take the place of some of the [enterprise content management] systems, or at least some of the workflows that now live in ECM systems."

She predicted the future of EFSS will be as a business productivity application, or "next-generation content and collaboration play." EMC, Citrix, Accellion, Box and Dropbox, Microsoft's OneDrive for Business, Amazon's Zocalo and Google's Drive should also be among the top offerings, according to McClure.

Chandana Gopal, research manager at IDC, said Dropbox, Box and Microsoft accounted for 60% of the EFSS market share in 2014. She characterized Dropbox as the most virally adopted, positioning itself as the "file server for everything."

"The reason file sync and share saw viral adoption in enterprises is that workers were able to self-administer and use it without IT involvement," Gopal said via email. "Enterprise IT has to be very careful in how it implements EFSS so that it doesn't create roadblocks in the way workers do their jobs or adoption will suffer."

EFSS adoption on the rise

Industry analysts expect the EFSS market to remain healthy -- at least in the short term -- as IT organizations cope with the proliferation of mobile devices among their employees.

Enterprise Strategy Group research showed that 42% of more than 300 surveyed IT professionals had a corporate account for online file sharing and collaboration services this year, compared to 28% in 2012, according to McClure.

Surveys of more than 250 IT professionals at mid- to large-sized organizations by 451 Research's TheInfoPro service showed that 27% had file sync-and-share implementations in 2013, and 36% did this year, although spending on EFSS dropped slightly.

"While adoption is increasing, it seems to be a sort of one-off purchase," said Marco Coulter, a vice president at 451 Research's TheInfoPro.

TheInfoPro's survey results listed Microsoft as the leading vendor, through SharePoint with Office 365. More than 30 other vendors also gained mentions, but Coulter predicted that within three years, IT departments will get file sync-and-share capabilities as features of application-level products rather than as standalone products.

"Right now, most of the applications haven't had a good capability for file sync, particularly as it extends into mobile. That was how products like Dropbox became the sort of default gray IT," Coulter said. "But, paying for this as a separate feature when it becomes more and more available with other products? At some point, IT is going to say, 'Does this make sense?'"

Hybrid cloud, on-premises EFSS options emerge

ESG's McClure said most IT organizations that have deployed EFSS have used public cloud-based, software-as-a-service options because those offerings were the earliest in the market. Only within the past year have hybrid and on-premises options started to challenge the public cloud model, she said.

But McClure and other analysts expect hybrid and on-premises options to become more popular with IT departments that need to know where their data is stored and want to manage their own encryption keys.

ESG's research showed that 97% of the organizations that use public cloud-based EFSS expressed interest in storing some or all of their file data using their on-premises storage resources, as opposed to the service provider's data center.

McClure said four of the most visible hybrid and on-premises options are Accellion's kiteworks, Citrix's ShareFile, EMC's Syncplicity, and Egnyte's Storage Sync and Storage Connect.

EFSS moves into backup

While analysts emphasize that file sync and share is not the same as backup, many backup vendors have extended their reach by providing EFSS capabilities or have it on their roadmaps. These include end-point backup specialists Druva and Code 42, EMC Mozy cloud backup and more mainstream backup apps such as CommVault, Asigra and Barracuda.

EFSS products beef up security

The security of enterprise file sync-and-share products and services remains a huge concern for IT departments trying to keep a tight rein on corporate data.

One trend during the past year was the option of on-site encryption keys for customers that want complete control over who is able to read their data, according to IDC's Gopal.

"Maintaining keys on-prem allows privacy-conscious enterprises to consider public-cloud FSS vendors, since files are not readable by anyone, including government, without the keys," Gopal wrote in an email.

ESG's McClure added that security concerns could drive companies to hybrid EFSS alternatives that enable more robust security controls, which integrate with their enterprise IT environments.

"Typically this type of file data is not the data that's been running the business or keeping the lights on, so it doesn't get IT's highest levels of attention," said McClure. "But, the risk factors and security factors get IT's attention."

EFSS application integration

IDC's Gopal said most major file sync-and-share vendors made application programming interface (API) announcements in 2014. The APIs allow their FSS platforms to integrate with other software that customers might already own, and/or add functionality from other products -- such as data loss prevention -- that the FSS products might not originally have, Gopal said.

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