Amidst Ongoing Consolidation, Report States Market Expansion Will Drive Continued Growth for Innovative Vendors

CLEVELAND – August 30, 2006 – In a report released this quarter by leading independent research firm IDC, Hyland Software Inc. was among the fastest growing content management vendors in 2005 based on software market revenue. Hyland develops the OnBase enterprise content management (ECM) suite.

IDC’s “Worldwide Content Management Software 2005 Vendor Shares” report (July 2006, IDC # 202317) illustrates that Hyland Software’s software revenue grew 30.2 percent year-over-year in 2005. Hyland’s growth rate surpassed the overall content management market growth rate of 9.6%, and was the highest growth rate of the top 15 content management software vendors. IDC tracks over 200 vendors in the content management market.

“Although the content management market has continued to consolidate, witness the steady pace of acquisitions in 2005 and (so far) 2006, the market still has plenty of headroom,” said Melissa Webster, program director, Content Technologies and Digital Media at IDC.

“There is ample opportunity for smaller, innovative vendors – for instance, those that address the mid-market, those that offer compelling point solutions or innovative capabilities that make attractive additions to ECM suites, and those that provide vertically oriented content management solutions or that address compliance or facilitate e-discovery,” stated Webster.

“This report underscores that the market for ECM infrastructure for the world’s largest companies is only one piece of a bigger pie,” said A.J Hyland, President and CEO of Hyland Software. “The opportunity to deliver vertical and back-office ECM solutions tailored for organizations just below the Global 2000 is still up for grabs. Hyland’s wholly organic and consistently market-beating growth in meeting the distinct needs of mid-tier enterprises supports IDC’s data.”

Reinforcing the significance of offering vertically focused solutions, Hyland Software has been named a Top 25 Vendor by Mortgage Technology magazine and has earned "The Top 20: 2006 KLAS Mid-Year Report Card" honors from the research firm specializing in monitoring and reporting the performance of information technology vendors in the healthcare field.

With the quarter ending June 30, 2006, Hyland Software has achieved thirty-two consecutive quarters of profitability. To continue its strong customer service delivery worldwide, Hyland has also recently opened two new international offices in Sao Paulo, Brazil, and by Trafalgar Square in London, England.