Q: Will you start by telling us where Xyleme stands today at the end of 2008? Has it been a successful year for the company?

While 2008 was the best year in the history of our company, the current economic situation leads me to pause before I answer this with too much excitement. I think under normal economic conditions I would be extremely bullish about 2009, but the uncertainty in the economy means we have to have a much more cautious view.

2008 was a turning point for Xyleme. We ended the year with a product that is much more balanced from a functionality, infrastructure and usability perspective. We now have a number of great partners around the world who are capable of selling and supporting the product. Combined with growing market awareness, we are very excited about the future. But until we get some stability in the markets, buyers will continue to be cautious.

Q: How do customers and prospects react to Xyleme’s value proposition? Are you still spending a lot of time educating the market?

Customers and prospects clearly better understand our value proposition today than in the past. While many clients are or have been in upgrade or replacement mode for their Learning Management Systems (LMS), they are really just starting to address their content challenges. We spend a lot more time speaking with prospects who understand why XML technology is fundamental to solving their content issues. Whether you are talking about informal learning, dynamic content delivery or publishing to new output formats, we are spending less time educating people. And now, most prospects understand that what we do is different than competitive solutions that can simply “output XML files”.

Q: What are the key industry trends you experience in the field (both market-driven and technology-driven)? How does Xyleme respond to these trends?

The main trend we are seeing is a clear desire to simplify content development and more importantly maintenance. As organizations are starting to get their arms around their content problems, we are seeing a movement away from stand-alone authoring tools. The idea of single source content has really started to appeal to people. When you get into situations where you have multiple output formats (eLearning, ILT, Performance Support or multiple formats for each of these) and multiple audiences (customer types, employee roles, brands or geographies), or you create a lot of derivative works from the content, the underlying technology becomes key. This is our sweet spot. We have built a very robust platform for these use cases.

Q: What challenges do you see ahead in 2009 given the financial downturn that affects all of us?

Let’s remember that while we are in a recession, with U.S. GDP declining by 1-2% (according to most analysts), we still have the other 98% of the GDP to generate opportunities. One of things Xyleme brings to the table is a much faster Return on Investment and lower cost of implementation than our competitors. I believe this means more opportunities for us in 2009 as pressure to do more with less increases. And globally, we are extremely well positioned for multi-national companies who need a cost-effective and efficient way to localize and translate their learning content.

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