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Taking stock of shared document services

This article appears in the issue June 1998 [Volume 7, Issue 8]

It could be a few isolated blips on our radar screens, or it could signal a trend: Several companies have started to offer "shared document services," in an outsourcing arrangement using a service bureau model. The approach reduces risk for users of the services, drastically cuts upfront costs and usually provides more security and redundancy than a private network for client-server applications. The services have only been offered to the marketplace within the last six months, and the companies involved are taking different approaches to pricing structures and target markets.

Image-X (www.imagexx.com) has released its Electronic Vault Personal Edition and already has users up and running. After a decade of providing enterprise client-server document imaging solutions, Image-X has shattered the cost barrier. For as little as $29.95 per month, customers can sign up for Image-X's service, in which up to 5,000 documents are scanned locally ($49.95 per month for 15,000 pages) and uploaded to Image-X's servers. That not only saves the headache of managing and maintaining the documents, but also of buying and backing up documents with local storage. Documents can be accessed remotely, and the option of making copies of the images on CD-ROM is available.

"Our salespeople can now go into an account and walk out with a contract," said Mohammed Shaikh, CEO of Image-X. "Who can't afford it at that price?"

"Our goal is to see the entire industry grow to $10 billion or larger," added Shaikh.

The Multi-User Edition can integrate documents with line-of-business applications, as well as with workflow or COLD software. American Airlines (Fort Worth, TX) uses the service in three locations, while 10,000 users at Earle M. Jorgensen (Brea, CA), the largest steel distributor in the world, use it in more than 30 locations. Riverside County Courts (CA) also use the service across a 200-mile-wide network.

But what about security? A remote user would have a database with a unique identifier, which is transmitted through RSA (www.rsa.com) to the server, which has a firewall. If hackers break through the firewall, they would still need the user's password and PIN code. If they did have that, they would not be able to find anything. The Image-X Minds database sits on top of the operating system, so a simple "DIR" command would yield nothing, because Image-X is storing just the object, not the index information.

Cylex Systems (www.cylexsys.com) takes a different approach. Instead of a flat monthly fee for a specified number of documents, it charges according to the number of documents stored, and there is no access charge for retrievals. "We don't want to be a data center," said Cylex President Zijad F. Aganovic. "We are just providing the physical space."

How did Cylex arrive at that approach? "We analyzed corporate needs for several years," Aganovic said. "We felt we needed to set up a company based on a service paradigm, rather than a product. There aren't many companies that have made a wholesale transition to a service orientation."

Cylex uses a thin-client approach, which Aganovic said is the only way to go when developing a service approach. It is developed with a Visual Basic front end and uses VB and C on the back end.

Aganovic recently spoke with David Skok of SilverStream Software (www.silverstream.com), a pioneer in breaking price barriers in the industry. "We agreed that even if the price is inexpensive for an in-house system, you still have thorny systems integration issues. With the service-oriented approach, those issues go away," said Aganovic.

Unlike Image-X, which is targeting users from large organizations down to small, independent users, Cylex is targeting midsize companies, but it's going after mission-critical document applications.

In the healthcare arena, LanVision (www.lanvision.com) offers Virtual Healthware Services. None of its competitors has developed a competing approach. That means either LanVision is right on top of a trend--or out in left field.

"This is part of a much bigger trend, far beyond just healthcare," said CTO Rob Golden. "Because of the communications explosion and proliferation of Web technologies, multiple applications can be housed at a data center, and the customer will be able to try multiple applications from the service, without the risk and expense of buying and installing them themselves. For instance, you will see us supporting multiple clinical data repositories."

And how is the pricing structured? Not a few dollars per month or pennies per page, but a hybrid pricing structure that includes initial installation, setup and training, which may run $100,000 to $200,000. Then different types of charges apply: documents input into the system--whether scanned, interfaced or imported, with scanned running as much as 25 cents per page, interfaced about 7 cents and imported even less; retrievals, which may be 5 to 10 cents per page; and online storage, running about $300 per gigabyte per year.

LanVision can set up a virtual private network (VPN), which is as secure as a private network. "It is almost impossible to hack into, and even if you do, the data is encrypted," Golden said.

A $6 million data center has Oracle (www.oracle.com) running on DEC (www.digital.com) Alpha servers, and uses EMC (www.emc.com) RAID 5 drives, HP (www.hp.com) optical and a real-time tape backup from StorageTek (www.storagetek.com). There is 100% redundancy. Even the data and power lines come into the building from different directions. If the power goes, a huge generator kicks in. Substantial financial penalties are written into the contracts if LanVision falls below a 99% up-time guarantee.

LanVision is targeting prospects from large to small. Its largest customer to date is Detroit Medical Center.


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