Research Migrating Off Notes/Domino Email May Make Sense in ...

Research
Publication Date: 22 August 2011 ID Number: G00215901
Migrating Off Notes/Domino Email May Make Sense in
Some Circumstances, 2011 Update
Tom Austin
IT professionals often re-evaluate Notes/Domino for email because they sense that the
market is moving away from the product, because SharePoint leads them to consolidate
around Microsoft, or for other reasons. Migrating to another third-generation email
product may not, generally, make economic sense, but consolidating vendors, moving to
cloud email services, seeking capabilities not available in the product's ecosystem or
pursuing a larger collaboration strategy, may offer valid reasons for migration.
Key Findings
From July 2010 through June 2011, 116 Gartner clients asked for advice about
migrating away from Lotus Notes email; essentially the same number as between July
2009 through April 2010 (although Notes application migration inquiries appear to be
increasing).
Based on confidential discussions with these clients, we expect that at least one-third
will have stopped using Notes/Domino email by year-end 2013.
Neither IBM nor its customers face an immediate crisis, because IBM will continue
investing in the platform to add more value and sustain service revenue.
We estimate that it costs about $200 per user to migrate users from one third-generation
email platform to another, but the cost of a major version upgrade can be almost $150
per user. (Migration to software-as-a-service [SaaS] or cloud-based email could cost as
little as $30 per user.)
Recommendations
Treat email as part of a three- to five-year investment strategy for collaboration
capabilities, including Web conferencing, instant messaging, team workspaces and
social software.
Consider the range of on-premises, outsourced, SaaS, appliance and cloud provisioning
options.
Determine what emotional factors may be at play in the decision-making process, and
the degree to which they are truly relevant.
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Re-evaluate whether software product maintenance agreements make economic sense,
particularly for infrequently upgraded commodity products such as email and
calendaring.
Publication Date: 22 August 2011/ID Number: G00215901 Page 2 of 11
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TABLE OF CONTENTS
Analysis ....................................................................................................................................... 4
Introduction ...................................................................................................................... 4
Lotus Notes Email is Under Pressure, But Still a Safe Investment .................................... 4
Gartner Client Inquiries on Lotus Notes Email ...................................................... 4
Catalysts for These Inquiries ............................................................................... 4
Implications for Lotus Notes Email and Its Customers .......................................... 5
Reasons to Stay With, or Leave, Lotus Notes Email ......................................................... 5
Staying With Lotus Notes Email ........................................................................... 5
Migrating Away From Lotus Notes Email ............................................................. 6
Recommendations ........................................................................................................... 7
If You Are Deciding Whether to Migrate ............................................................... 7
Costs ...................................................................................................... 7
Context ................................................................................................... 8
If You Are Staying on Lotus Notes Email ............................................................. 9
If You Are Migrating Away From Lotus Notes Email ............................................. 9
Recommended Reading ............................................................................................................. 10
LIST OF TABLES
Table 1. Per-User Costs of Migrating Versus Upgrading an Email System .................................... 7
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ANALYSIS
Introduction
Many clients have asked Gartner for advice about migrating away from Lotus Notes email. Many
seek that advice year after year; that is, not everyone who asks about migrating actually does it.
Some decide the time is right, others do not. Either choice may serve the enterprise well,
depending on its needs and circumstances. Lotus Notes email users considering a migration
should learn about the product's place in the market and about the factors they need to consider
before making a decision.
Lotus Notes Email is Under Pressure, But Still a Safe Investment
Some clients ask Gartner about migrating from Lotus Notes email because they are concerned
about the viability of the product. Clients have some legitimate concerns, but we believe that IBM
will continue to make reasonable investments to sustain and grow all related revenue streams
(including licensing, SaaS, software maintenance, consulting and outsourcing). Thus, the product
remains safe and valuable for enterprises that wish to stay on it.
Gartner Client Inquiries on Lotus Notes Email
Gartner's interactions with clients convince us that some are moving away from Lotus Notes for
email. From 1 July 2010 to 30 June 2011, 116 different clients booked one or more calls with
Gartner analysts seeking advice on migrating away from Notes for email. These inquiry clients
represent enterprises based in North and South America, Europe, Asia, the Middle East, Africa
and Australia. Most were considering moving to Microsoft Outlook/Exchange for email (either onpremises
or SaaS), with some thinking about Google Apps, a cloud offering, as well.
By comparison, during the same 12-month period no Microsoft email customers called us for
advice on whether to migrate to Notes/Domino for email (although there are a growing number of
companies who have moved, or are moving, to Google).
Catalysts for These Inquiries
Several factors contribute to the inquiries; the main points are discussed below.
Clients fear that third parties will make fewer investments around Notes/Domino (and Quickr and
Sametime), so that the platform will see less innovation and a diminished choice of services,
packages, add-ins, widgets and applications. They cite many cases where the desired new
capabilities are either not available at all on the Notes platform or are delivered many months (or
years) after those capabilities are available for Notes/Domino. In general, clients perceive that
there are more Exchange (and SharePoint and Lync) resources than Notes/Domino (and Quickr
and Sametime) resources, and are concerned that the gap is widening. The issue raised is not
the frequency with which IBM updates its technologies in comparison with Microsoft's frequency
of change, because IBM delivers more frequently than Microsoft. It's the apparent depth of the
Microsoft ecosystem versus the IBM ecosystem.
These clients also told us that they find Microsoft's collaboration products increasingly attractive
compared with the IBM collaboration products. They believe that Microsoft's offerings (from
operating systems, through network and directory infrastructure, to productivity tools and Office
servers) integrate together better than the combination of Microsoft and IBM tools. (However,
there are costs and risks associated with standardizing on a single vendor that also need to be
considered.) Emotion plays a role in many enterprise decisions. Some people have emotional
biases for or against certain vendors or certain products. Gartner clients often confess to us that
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someone in their enterprise has what we call "Outlook envy." For example, a new CFO told a
client, "I want Outlook. Just tell me how much it will cost to get me Outlook, and I will find you the
money." Our clients also report that some senior executives claim that "everyone else in business
class uses Outlook." (Conversely, no Gartner client on a confidential inquiry has told us that users
are agitating to move to Notes, or that senior executives want to replace Outlook/Exchange with
Notes/Domino.)
Two other factors are:
Notes/Domino email users that also run Microsoft often believe that they have already
paid for email in their Microsoft Enterprise Agreement.
Users often demand Microsoft Office products.
Other factors may have little to do with Lotus Notes email specifically. In software markets,
momentum can become self-reinforcing as enterprises become concerned about the future of a
product whose customers are seen to be leaving and, therefore, decide to seek a "safer" product.
Some enterprises with multiple email systems may migrate away from one of them simply to
consolidate vendors. In addition, questions about migrating from Notes/Domino email may reflect
that IT organizations are performing due diligence before making a major investment to upgrade
or migrate.
Implications for Lotus Notes Email and Its Customers
Based on confidential discussions with the 116 client organizations that asked us about migrating,
we expect that at least one-third of them will have stopped using Notes/Domino email by yearend
2013, because they told us they have already moved — or indicated that they have already
made the decision to move. Unless IBM can significantly alter market perceptions, the trend to reevaluate
Notes/Domino email — and potentially migrate away — will continue.
The cost of migrating to a different system is a huge inhibitor to enterprises considering whether
to migrate from Notes/Domino. (The cost of application migration is even larger.) The financial
benefit of migrating is not obvious. In fact, all things being equal, migrating from one thirdgeneration
collaboration offering (such as Notes/Domino) to another third-generation system is
not financially justifiable. When all the costs and benefits are considered, IBM — along with
Microsoft and a number of other vendors — delivers mature, well-engineered, enterprise-class
email systems that are evolving toward cloud services (see "IBM Gets Serious About Cloud E-
Mail").
The impact of those enterprises that do decide to leave Notes/Domino email does not appear to
impact the overall financial health of this business. IBM appears to retain most Notes/Domino
revenue, even when email is migrated, because customers are less likely to migrate applications
away from Notes/Domino — in part because application migration costs far more than email
migration.
Reasons to Stay With, or Leave, Lotus Notes Email
Staying With Lotus Notes Email
IBM remains a strong and viable email provider. It derives significant revenue from
Notes/Domino, both as an email platform and as an application platform. It continues to invest,
and it delivers frequent updates and upgrades that create real value for its customers.
Furthermore, IBM has shown leadership in a number of areas and has articulated a bolder vision
for its fourth-generation collaboration system than Microsoft has (see "The Emergence of Fourth-
Publication Date: 22 August 2011/ID Number: G00215901 Page 5 of 11
© 2011 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Generation Collaboration Services" and "IBM Joins the Race to Revolutionize Collaboration").
Fourth-generation systems will integrate multiple communication modes, smart work
environments and social features. However, it is still too early to tell whether IBM will succeed
with that vision, and it will take years for these systems to displace email. At Lotusphere 2011,
IBM shifted its focus somewhat — from collaboration technology to social business frameworks
(see "Pay Attention to IBM's Lotus Strategy Shift" and "Notes and Domino Next: A Glimpse Into
IBM's Collaboration Future").
Some enterprises have standardized on IBM technologies: ranging from Symphony on the
desktop to Notes, Domino, Sametime, Quickr, Content Manager, WebSphere, DB2, Tivoli, and
other IBM frameworks and offerings. These enterprises often refer to themselves as IBM/J2EE
(or, more recently, Java EE) shops, just as some enterprises standardized on Microsoft
technologies refer to themselves as Microsoft/.NET shops. Fully dedicated, homogeneous
IBM/J2EE shops have a much harder time rationalizing a move to Microsoft Exchange and
SharePoint, because it requires far more change in how IT functions. (Most enterprises seeking
advice on migration are in a mixed operating mode.)
Many Gartner clients report that their internal analysis shows that either the costs of migrating
away from Notes/Domino email exceed the benefits, or that they cannot obtain the savings they
foresee unless they migrate away from Notes for applications as well as email.
Application migration (from Notes/Domino to anything else) is typically a complex process. It is
certainly nontrivial, usually quite expensive, and something that typically requires several years to
complete (see "Seven Critical Steps to Migrate Legacy Lotus Notes Applications").
Notes-based applications are "sticky," so enterprises are reluctant to tamper with them. Migrating
a large collection of rich, mission-critical Notes/Domino applications typically requires a complete
redesign — making it difficult to demonstrate ROI for the migration.
Excluding application migration costs, we estimate that it costs about $200 per user to migrate
from one email platform to another. Approximately half of that figure is for personnel costs, the
other half assumes capital investments in new email licenses, hardware and migration utilities.
Thus, a migration for a midsize enterprise with 5,000 users would cost $1 million — a lot of
money if you're simply moving to another email vendor with similar functions.
Gartner clients that re-evaluate but then decide to stay with Notes/Domino email, typically do so
because the application continues to serve their enterprise and IT organization needs. Clients can
then put their efforts into other initiatives that will provide more business value (for advice for
enterprises staying on Lotus Notes email, see the section If You Are Staying on Lotus Notes
Email).
Migrating Away From Lotus Notes Email
Consolidation around a single supplier can drive enterprises to drop vendors with which they are
otherwise satisfied. Cost cutting drives a lot of consolidation. IBM faces pressure in this regard: a
majority of enterprises — including many IBM email customers — already run Microsoft Office
SharePoint Server, and SharePoint deployments typically signal a heightened interest in
replacing Notes/Domino email with Exchange. SharePoint is a general collaboration platform that
integrates with Outlook and other personal productivity applications; SharePoint offers portals,
content management, team rooms, and other social software and collaboration functions. Users
like the close integration of components. This SharePoint momentum leads many IT leaders and
planners responsible for Notes/Domino email, to consider switching entirely to Microsoft
workplace applications, rather than building out workplace functions with IBM offerings such as
Lotus Quickr and Connections.
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Cloud collaboration services, starting with email, have prompted few enterprises to migrate away
from Notes/Domino, or other email solutions, as yet. However, interest in cloud computing is
growing, and cloud services will penetrate more of the email and collaboration market. Most early
adopters are small firms, although some are large enterprises. We expect cloud collaboration
services will penetrate 10% of the market by year-end 2014, reaching 55% by the end of the
decade. Higher education, discrete manufacturing, hospitality and retail are the sectors most
likely to adopt cloud collaboration services today, while intelligence, defense, healthcare
providers and the regulated portions of financial services are the least likely to do so (see "The
Cloud Email and Collaboration Services Market, 2011 Update").
Recommendations
If You Are Deciding Whether to Migrate
Enterprises considering whether to migrate away from Notes/Domino email should consider
several factors, but one factor they should not consider deserves emphasis first. Many Gartner
clients express concern about the product's longevity and ask whether Notes/Domino will be
around for a long time. Notes/Domino customers should not worry about product longevity, at
least in the two- to five-year planning period. Customers concerned about longevity should
consider a migration if and when IBM significantly cuts investment, but not before — because
taking a migration cost hit early and speculatively is hard to justify.
Planners should also investigate to what extent emotional factors may drive the decision-making
process, and determine whether these emotions conceal real business issues that haven't been
articulated. If planners ignore emotions, they may steer decisions in the wrong direction.
Likewise, if planners recognize emotions, yet disregard them in favor of other business
requirements, they may overlook real user needs; for example, for better user interfaces — which
may seem to be just a matter of personal preference but could affect productivity, employee
morale and job satisfaction.
Costs
Every enterprise must factor cost into a decision about whether to migrate away from
Notes/Domino email (see Table 1). We estimate that a migration will cost about $200 per user.
However, enterprises must compare this cost with the cost of any version upgrade they may need
to make if they stay with the current vendor's product. IBM supports both 32-bit and 64-bit
servers, so a hardware upgrade is not required. Nevertheless, 64-bit servers yield better
performance. Thus, an upgrade to a new major version of the same product may benefit from an
equal capital investment in hardware and software to get the current version and move to 64-bit
hardware — that is, $100 per user. The labor required for a version upgrade typically costs less
than half of what a vendor migration requires — that is, less than $50 per user. Therefore, a
version upgrade may cost nearly $150 per user altogether, whereas a vendor migration will cost a
little over $50 per user more. For an enterprise with 5,000 users, a vendor migration may cost
$250,000 more than a version upgrade — a substantial amount, but still not prohibitively
expensive.
Table 1. Per-User Costs of Migrating Versus Upgrading an Email System
Costs Migration to New System Major Version Upgrade
Hardware and Software $100 $100
Labor $100

With cloud-based or SaaS email, there can be minimal to no costs for hardware, software
licenses or migration utilities — resulting in costs as low as $30 per user.
Planners should look at individual components of the cost before deciding about email migration.
In particular, a number of clients moving away from Notes/Domino email cite the cost of people
with Notes/Domino skills as a factor in favoring migration to Outlook/Exchange. The cost of IT
staff with Notes/Domino skills generally runs somewhat higher than the cost of people with
comparable Outlook/Exchange skills. Be sure to assess skill costs locally, because they will vary
greatly by geography — Notes/Domino skills cost less in some cases. Also consider the
availability of skills in the relevant labor markets, and the availability, breadth and depth of thirdparty
offerings. In some areas, enterprises report that they have virtually no option other than to
train their own Notes/Domino experts.
Operating costs can also affect decisions. We estimate that the cost of running an infrastructure
with both Microsoft and IBM in use is greater than the cost of dealing with either vendor's
technology stack alone — at least for enterprises with fewer than 10,000 employees. In general,
however, if the enterprise runs email and calendaring on Windows servers and no other
applications, Domino and Exchange cost about the same to operate. We typically see quotes for
outsourced Domino email servers running somewhat higher than similar services for Exchange
hosting, but, in some cases, Notes/Domino outsourcing costs appear comparable to, or better
than, similar services for Exchange. Again, investigate these costs for your particular location or
circumstances.
On-premises implementations and cloud email services differ greatly in cost for the same
features, but this difference shrinks as the size of enterprise gets larger. Cloud services today
may not suit enterprises with more than 10,000 users. Furthermore, there are the hidden costs of
managing a cloud email service, because many on-premises features are not yet present in cloud
email services. In this relatively immature market, the cloud or SaaS email offerings from Google,
IBM, Microsoft and others are all at very different stages of development, and this market is
bound to evolve.
Context
Planners should not focus on email in isolation. For example, if they plan an email migration as
part of a broader effort to consolidate vendors, they should also consider the cost of migrating
other applications from the same platform. Application migration costs can be significantly higher.
The broader context of any decision about email typically includes enterprise architectures,
workplace and business applications, technology framework and integration strategies, and
security, privacy and information retention policies, as well as sourcing, provisioning and support
programs for employees, contractors and others. Any of these issues could affect the ultimate
success or value of an email migration.
Planners should treat email as part of a broader, three- to five-year investment strategy for a
range of collaboration capabilities, including Web conferencing, instant messaging, team
workspaces and social software. These capabilities will converge with email over time (see "The
Emergence of Fourth-Generation Collaboration Services").
In the future, many enterprises will turn to cloud providers (including Google, Microsoft and IBM)
for email, calendaring and related services for employees. Planners should consider a mix of onpremises,
outsourced, SaaS and cloud-provisioning options. Hybrid models can sometimes make
sense; that is, a mix of on-premises and cloud implementations. Externally managed and locally
installed email and collaboration appliances offer another interesting provisioning model that is
emerging.
Publication Date: 22 August 2011/ID Number: G00215901 Page 8 of 11
© 2011 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

If You Are Staying on Lotus Notes Email
Enterprises that choose to stay on Notes/Domino email can take several steps to control costs,
most of which apply to any email product.
First, planners should re-evaluate whether software product maintenance agreements make
economic sense, particularly for infrequently upgraded commodity products (see "Dropping
Collaboration Software Maintenance"). Maintenance for any product represents a significant cost
that exceeds the original cost of the license over time.
Next, planners should consider their approach to integrating their email system to other services
or applications. Loosely coupling transport services, routing and the presentation layer, for
example, provides more agility; that is, more degrees of freedom to modify and evolve
technologies in ways that may not currently be well understood. By contrast, some enterprises
find that tight coupling of email to workflow (and heavy customization) delivers more benefits per
dollar. Loose coupling works better in times of rapid change and uncertainty, as well as with
systems that have little customization. Tight coupling and heavy customization make more sense
in more slowly changing business environments.
In general, planners should minimize the customization of straightforward commodity systems.
For example, modifications of Notes email templates should be avoided, and reversed out over
time. Customizations increase vendor lock-in and reduce the enterprise's options, should it
consider a migration in the future. Planners should choose third-party components (and
subsystems, systems and services) over custom, in-house development. Third parties have a
larger base against which to spread the cost of tracking changes in underlying platforms. Standalone
products and online services are often superior to extensions developed by third parties or
in-house, especially because it is easier to determine what meets user requirements (see "Magic
Quadrant for Social Software in the Workplace").
Finally, enterprises should clean up their workplace applications over time, by substituting pure
Web interfaces where appropriate and relying on industry-standard service interfaces (such as
SMTP) where available. This cleanup will modernize the applications and give the enterprise
additional freedom. IBM has promoted application modernization via Web interfaces and XPages,
but the bulk of applications appear to remain Notes-client-based. Notes customers should exploit
these new capabilities when the opportunity presents itself; for example, when an application is
being updated to reflect revised functional requirements, consider upgrading the user interface
technology as well.
If You Are Migrating Away From Lotus Notes Email
Enterprises that do decide to migrate away from Notes/Domino email should not immediately
focus on a particular offering. They should consider the range of delivery models, including onpremises
software, outsourcing, appliances and cloud provisioning. Cloud provisioning will
primarily appeal to smaller enterprises concerned with cost, but enterprises should require their
suppliers to continue to reduce cloud-based services prices — as prices, in general, fall in the
market.
IBM customers migrating to Microsoft will probably be disappointed. IBM's approach is typically
more hands-on through its services arm, while Microsoft's focus is on products, technology and
platform ecosystem, deferring to its partners to take responsibility for its customers' migration
projects. Microsoft does not, typically, take responsibility for the migration. Like IBM, Microsoft will
encourage customers to build applications on top of the Microsoft infrastructure, which will lock
customers into the Microsoft platform for a long time. We are concerned that enterprises will
repeat in SharePoint 2010 environments, many of the mistakes they made previously in the
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© 2011 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Notes environment — such as a lack of governance and poor application architectures. (Best
practices and tools to support organizations are available, but too many fail to exploit them.)
RECOMMENDED READING
"One Company Cuts Lotus Domino Costs by $11 Million Over Two Years"
"IBM Gets Serious About Cloud E-Mail"
"The Emergence of Fourth-Generation Collaboration Services"
"IBM Joins the Race to Revolutionize Collaboration"
"Seven Critical Steps to Migrate Legacy Lotus Notes Applications"
"The Cloud Email and Collaboration Services Market, 2011 Update"
"The Emergence of Fourth-Generation Collaboration Services"
"Dropping Collaboration Software Maintenance"
"Magic Quadrant for Social Software in the Workplace"
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