Join us for the 6th annual VoIP Conference & Expo at IIT on October 12-14, 2010 in Wheaton, IL (Chicago area). The conference brings together technical professionals and executives from the data and telecommunications industry, standards bodies, government agencies, and the business community. The presentations, exhibits, social events, and session breaks provide opportunities to learn and meet new contacts and partners. Speaker, sponsor, exhibitor and attendees options available.
In the new world of enterprise communications, we have the usual war of all against all, but we also have some specific pairings:
* Cisco vs. Microsoft, to determine which can parlay its position as an enterprise-wide strategic vendor into the next-generation communications incumbency.
* Microsoft vs. IBM, to determine which can parlay its strength at the desktop/email platform into communications leadership.
* Avaya vs. Cisco, to determine who will take the leadership within the “legacy” IP-PBX marketplace, and to see which (if either) can leverage this position into a broader communications ascendancy going forward.
Our newest edition to the fight card is Skype vs. Google. The immediate battleground is free or sorta-free Internet calling, where Skype holds the incumbency and the current numerical edge—but where Google’s Voice/Gmail integration makes it an instant contender. But that’s only the most obvious battleground.
Skype is planning to go public in hopes of raising $100 million or so—though that IPO will be short-circuited if Cisco buys Skype, as the current rumor suggests. More about Cisco-Skype in a minute.
In Skype’s SEC filing that launched the IPO process, the company laid out its plans for how it intends to grow its business as a public company. “Our strategy has four key components,” they state: Those components are:
1. “Continue to grow our connected and paying user base.”
2. “Increase usage of our free and paid products and extend our relationship with our users.”
3. “Develop new monetization models, including advertising.”
4. “Broaden our user base to include more business users.”
Number 3 above is the one you want to pay attention to. Like a dummy, when I blogged about this filing, I focused on Number 4, because, hey, we’re all about business users. Say “business users” and my ears perk up and I come running like Angus and Foo when they hear the cat food cans being pried open. However, I should have emulated Angus in other ways; though a loving cat, his temperament and mien have been aptly characterized by my wife as “Nixonian.” I should have been more wary, suspicious even.
Because re-reading that SEC filing, it’s clear to me now that the first shot in this battle wasn’t fired last week, when Google rolled out its Skype-killer VOIP/Gmail integration. It was fired by Skype with its IPO filing. Skype wants to get more aggressively into the online advertising game. That’s Google’s turf.
Obviously, both sides have been planning their respective moves for some time. Both pretty much have to go the route they each are going. So then the question becomes, if Cisco does acquire Google, will this be the harbinger of a Cisco-Google war? That is, will all of Skype’s interests as an independent, public company automatically transfer over to Cisco? Or will Cisco not feel the need to press the online advertising revenue stream, perhaps even seeing it as a diversion from its core business? Essentially Cisco would be buying the Skype technology, customer base and market position, but not necessarily all of the business model.
This Week’s UC Weekly
Frustrating and Annoying, But Not Necessarily Bad
On a warm, muggy, late summer’s day, a not-so-young-man’s fancy turns, inevitably, to…..UC! What else??
Two recent posts on No Jitter are of particular interest. The first is by Melanie Turek, who provides important perspective about expectations for CEBP. Melanie writes, “CEBP is most advantageous when companies identify key elements of their processes and use communications to improve them in unique ways. But most organizations don’t have the time, know-how or patience to do that.”
That gets to the heart of the issue with CEBP and, by extension, to UC. It’s one thing for an enterprise to add IM or presence, even video, to the communications tool kit it provides to its employees. It’s quite another to undertake a major overhaul of key business processes and embed communications into those processes.
Goodbye PBX. Enterprises and contact centers alike are moving to all-in-one IP communications systems in growing numbers. And chances are, they started with a “roadmap.” Read how such a roadmap of current IP system offerings, justification factors, upcoming solutions, and suggested planning guidelines can help your own move to IP communications.
Then learn more about the unified IP business communications solutions from Interactive Intelligence. Technology spanning nearly two decades. All-in-one, from Day 1.
Pushing Back Against the Carriers
Fred and Crystal and I have started working on the Enterprise Connect Orlando 2011 planning, which has meant a good deal of talk about what this program really should be, now that it’s called Enterprise Connect instead of VoiceCon. Over the coming weeks we’ll talk a lot about how that program is evolving, but I want to dwell for this week’s newsletter on something that we’ve observed in the past VoiceCon events.
Ten or 15 years ago, when our core audience was telecom managers, in the narrowest sense of that term—i.e., folks who bought and ran TDM PBXs—we always knew that their largest line-item expense, by far, wasn’t any sort of CPE, but rather was carrier services. Compared to those times, things are less clear nowadays; when it comes to wide area connections, technology boundaries have diffused if not actually dissolved. Most enterprise sites remain VOIP “islands” when it comes to connectivity with the external world, yet traffic internal to the enterprise can and generally is being carried among sites over WAN services that used to be considered “data” services. The emergence of SIP trunks will further integrate VOIP islands into the public IP telephony mainstream, but those SIP trunk deployments have been occurring slowly, for various technical and market reasons.
So at this point, we’re not as sure as we used to be about the precise share of the communications budget that must go to carrier services, but it’s clearly still substantial. And this brings me to the thing we have traditionally observed at VoiceCon, and that we are eager to see about in future Enterprise Connect events: Carrier services are critically important to the enterprise, yet sessions on these topics generally don’t draw as well as the CPE-oriented sessions.
This is something to watch in the future because, at least in theory, carrier services and network-based software functionality are going to be ascendant in enterprise communications in the future—this is the infamous “cloud”-based communications story, and it may not be happening yet, but everyone knows we have to keep an eye on it.
So given the wariness with which enterprise communications decision-makers have traditionally approached carrier negotiations and service elements, will our Enterprise Connect audience gravitate more toward carrier-focused content than they did in the past, during the VoiceCon era? I’m anxious to find out.
Strangely enough, it wasn’t ruminations over the Cloud that got me on this subject, but something much more mundane. On No Jitter this week, Matt Brunk wrote a short piece on something that got under his skin recently: Matt’s employees were being hit with charges from AT&T for text messaging on their iPhones. When Matt looked into the matter, he found that some of those charges were for text messages from AT&T’s own vendors, seeking to sell ring tones to Matt’s employees.
Matt has a small interconnect company, with just a handful of employees. If you’re a big multinational, think of how much money you’re spending for the privilege of having your carrier (whoever you use; I’m sure they all do it) hassle your employees with offers to sell stuff from which the carrier will get a cut. Galling. And very typical carrier behavior.
In the world of communications, you’re always going to be dealing with a carrier who’ll always be trying to work some angle to squeeze more money out of you. Pushing back on this may not be as sexy as a splashy new Cloud deployment, but I think there’s real money at stake.
This Week’s UC Weekly
Best-of-Breed Solutions
The UCStrategies team recently recorded two podcasts covering the Gartner Magic Quadrant for Unified Communications. As I read through Gartner’s report, I was struck by a statement in the opening section: “Despite the emergence of complete UC portfolios, these are still in an early stage, and no vendor product adequately addresses all of an enterprise’s UC needs. As a result, a best-of-breed approach remains the surest way of ensuring adequate functionality…”
The situation Gartner described isn’t new, and it will never go away. Major vendors always have and always will have holes in their product portfolios that are best filled by best-of-breed products. These gaps almost always plugged by products from smaller companies, like the two that Gartner refers to in their “Market Overview” section: Polycom for conferencing and Applied Voice & Speech Technologies (AVST) for unified messaging (UM).
Best-of-breed vendors face two common challenges: market awareness and building relationships with the major vendors. In working with would-be best-of-breed vendors to manage those challenges over the past 20 years, I’ve found that there’s no magic, but instead it’s about the fundamentals, and that includes spending money on the right things at the right time.
This issue of Enterprise Connect eNews is sponsored by NEC
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Spoiler alert, at least for six-year-olds: There is no Santa Claus. Also, LeBron James wanted more money and thought Miami was a better place to make it than Cleveland (no judgment on my part, I’ve never been to either city!). And also, Google is a publicly-traded company whose first obligation is to its shareholders, not to you.
That’s right, “Don’t be evil” was a marketing slogan, not something a guy with a grey beard brought down from a mountain on a piece of carved stone. Besides, Vint Cerf’s facial hair is way too well-groomed for him to be mistaken for Charlton Heston.
We’ve got a couple of posts on No Jitter about the Google-Verizon Net Neutrality agreement, but we haven’t gone crazy with it. I think that’s probably because everyone else has pretty much covered the major angles, and I don’t know, maybe my bloggers and I just aren’t as emotionally invested in Google as others who write on the Web seem to be. Maybe, having been through the Telecom Act of 1996 and its subsequent depredations, we’re just totally jaded. In any event, if you want an excellent short summary of the developments, with lots of links, Michael Finneran does have that for you here, and Dave Michels offers his perspective here.
I tend to agree with Michael that this deal pretty much codifies today’s status quo: Weak FCC, a nod to landline neutrality, endorsement of wireless walled gardens. And Michael’s right that Google—even if you take them to be a champion of openness—just doesn’t have a lot of leverage at this point.
Remember, the FCC lost the Comcast BitTorrent case. Congress is a mess and really always is when it comes to passing major policy bills on an arcane subject like Internet regulation. The carriers have always been the smartest and most eager purchasers on Capitol Hill, or Capital Hill if you prefer. All that adds up to the carriers being able to do what they want to do. The only question is whether they want to press their advantage to the fullest, or try to take the edge off with some good PR. The Google deal is a good PR move by Verizon, even if nobody believes they’re doing it out of the goodness of their hearts.
For a view of some of the real pressure points in future Internet usage—at least on the wireline side—check out this blog post from last month by John Bartlett. John understands Internet traffic flow and performance as well as anyone out there, and he also knows what the wireline providers do, what they want to do, and what they don’t do in terms of Internet traffic policing.
The bottom line is that while it’s in everyone’s interest for the Internet to be open and accessible, so as to retain the network effects and innovation possibilities, the carriers are for-profit businesses and so is Google. Internet advocates aren’t well served by getting too emotionally invested in any company doing “what’s right.”
This Week’s UC Weekly
UC Is Going Mobile (and With Good Reason)
Applications are the raison d’être for unified communications, and one of the great opportunities for the technology comes in extending those applications to mobile devices. Frost & Sullivan’s Senior Industry Analyst Jeanine Sterling conducted a Webinar this past week where she discussed the results of their recent study on Premium Mobile Enterprise Applications.
The study was conducted with 300 US and Canadian enterprise customers equally divided between organizations with more than 500 employees and fewer than 500, and explored their existing and planned implementations for four premium mobile applications:
• Mobile Office: Email, PIM, intra-office communication, and collaboration.
• Mobile Workforce Management: Web-based tracking through GPS-equipped mobile handheld devices to locate and manage mobile field workers and their tasks.
• Next-Gen Fleet Management: Web-based tracking and cellular/GPS devices installed in fleet vehicles for vehicle location, geo-fencing, maps, engine diagnostics and sensors.
• Mobile Sales Force Automation: Extending corporate CRM/SFA backend systems to mobile phones for access to product, pricing, inventory, and customer data in order to perform contact management and order management functions.
This issue of Enterprise Connect eNews is sponsored by Aspect
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Are You Ready?
Today’s socially networked consumers demand more from the companies they do business with. They expect higher levels of service and enhanced communications provided through more channels. Engaging in proactive conversations to deliver on consumers’ expectations is critical to a company’s ability to succeed.
Why Google Shuns Enterprise Communications
The big news last week was Google’s decision to discontinue Google Wave, its potentially-revolutionary UC service. I hate to say I told you so, especially because I didn’t tell you so—but I did kinda-sorta accidentally point in that direction.
A couple weeks back I wrote a blog entitled, “Dog Food, Kool-Aid, Google and Apple,” about a Web-based petition calling on Google to publicly release a softphone that it had been “dogfooding,” that is, rolling out to internal users. After watching a video demonstrating a leaked version of the softphone, I concluded that this was a product that nobody needed, and that it couldn’t matter less whether Google ever released it.
Google Wave may not have been in exactly the same situation—unlike the softphone, it did seem genuinely innovative and cool. But the bottom line was the same: It was a product that had no reason to exist, and it represented a foray into a market that Google didn’t need to be in.
Over at No Jitter, we have a couple of really fantastic short analysis pieces on the Google Wave decision: One by Brian Riggs, who highlights Google’s lack of commitment to the enterprise market, and one by Dave Michels, who happens upon the reason for that lack of commitment, which is something I think we should bear in mind as we think about Google in the enterprise communications market going forward.
Dave cites a quote from Eric Schmidt, Google’s CEO: “Remember we make the majority of our money on advertising;” Schmidt goes on to explain why releasing and supporting the Android OS makes business sense: The mobile Web is a source of ad revenue. The corollary would be that Google Wave didn’t make business sense for Google because it couldn’t generate ad revenue.
Most big technology companies at their peak have one—and really no more than one—core mission, and everything they do either supports that core mission or gets jettisoned (or the company goes under). Cisco is in the business of selling switches and routers, and everything else they do has to drive bandwidth usage. Microsoft, when it was at its peak, was all about the Windows operating system, and everything they did was about forcing people to use Windows.
Google is in the business of selling ads. They’ve been doing lots of other things as they try to figure out what will offer more outlets for them to sell ads. Maybe they see themselves as potentially in some other business in addition to online ad sales, but they’ve already got an incumbent’s dilemma: They’re a public company that depends on ads for their revenue stream and hence their stock price. As Eric Schmidt said in the interview Dave Michels quoted, Android is a great platform for furthering this mission—and, ironically, so is Android’s chief competitor, the Apple iPhone. If Android didn’t serve this purpose, its future would be a lot less secure, no matter how successful it was as a mobile OS.
So here’s my prediction about what Google will do in the enterprise communications space: Whatever sells ads. Right now, that’s synonymous with saying that Google will not be in the enterprise communications space, because free communications supported by advertising is not something enterprises are interested in deploying.
Will that change? It might. Probably not by the choice of enterprise managers, but if, somehow, Google comes up with a successor to Wave that becomes a hit with end users and they choose to use it in droves (think Skype), enterprise managers will be forced to deal with it; they’ll have to come down somewhere in the continuum of accommodation/toleration/looking the other way. It would be a consumerization play, and we know that the enterprise immune system is defenseless against successful consumer technologies.
So when I say I don’t expect to see Google as a significant challenger in enterprise communications in the near or even mid-term, what am I missing?
This Week’s UC Weekly
Cautiously Optimistic on Social Media
An article I wrote recently for nojitter.com about social media and the contact center triggered a number of emails—some pro and other con—and so I’d like to expand on the topic and my outlook for the future.
Here’s my main thesis: While great new technologies are being introduced from many of the contact center and social software vendors, unless an enterprise’s “people and processes” are taken into account, the technology will not be implemented and utilized properly.
Case in point: CTI has been around since the late 1990’s, but in many cases it wasn’t properly integrated into the contact center processes, the people (agents) weren’t given the tools and training needed to utilize the technology properly, and the result was that the CTI market did not take off as expected.
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Dave Michels’ lastest feature for No Jitter is entitled, “How to Cloud Telephony,” and the first thing I grappled with when I edited it was the headline: Is “cloud” the verb in that headline, as in, “how to make telephony more cloudy?” And does rendering telephony cloudier represent a promise—moving to this new architecture—or a threat, as when a particular prospect is said to be “clouding the horizon”?
Ultimately I decided to leave the ambiguity because the topic is still pretty ambiguous. “Cloud” is just like “unified communications,” in that it’s a hot term that is so vague that it truly can be defined any way the speaker chooses, and can be applied to whatever the speaker happens to be selling. It is almost empty of meaning, as far as I am concerned, and so Dave’s attempt to define the term “cloud” is valuable not for its potential to attain such an end, but for the ideas that get thrashed out in the process.
What I’ve settled on, at least for now, is that “Cloud,” at least as relates to telephony/communications, is only about make vs. buy, and not about technology at all. Dave may well disagree with me here, and probably a lot of you out there will disagree too, but to me that’s ultimately the only part of the concept that matters for enterprise decision makers. If a service provider, VAR, manufacturer, carrier, SI or anyone else comes to you and wants to provide you with certain functionality that doesn’t require you to purchase the infrastructure and software that hosts/runs that functionality, it’s cloud. And when they come to you with that offering, you don’t really care where they might be using virtualization, how many servers they’ve got, what their datacenter looks like. As long as you can get an SLA that promises metrics that meet your needs, and as long as you’re persuaded that they can meet that SLA, then it’s a pure build/buy decision.
And I think that’s one reason why these services have been slow to catch on in the communications sector, either among providers offering them or enterprises demanding them: For simple services, the build/buy decision was won by premises systems, and in more advanced, complex services, the reliability threshold hasn’t been met.
In plain-vanilla voice call control, the IP era’s clear winner was the PBX; Centrex, whether IP- or TDM-based, is effectively a non-factor any more. The build/buy equation was purely a cost calculation, and PBXs won.
But one reason that Centrex was only a cost decision is that Centrex, whatever its faults, could at least deliver on its SLAs. For the next generation of services, that reliability has not yet been proven. The question enterprise managers will have to ask themselves is what level of assurance they can have about reliability of the next-gen communications service they’re looking at. We learned first-hand, from talking to end user attendees at VoiceCon Orlando in March, that the risk is widely considered unacceptable today, and will continue to be viewed as such until proof to the contrary is offered.
Then, assuming the reliability hurdle is cleared for newer advanced services, you’ll get into the cost discussion, which will be a conversation about internal resources vs. external costs, capex vs. opex, various manifestations of vendor lock-in, and where business value is located in your enterprise.
That’s all in the realm of “public cloud.” Separately, you have the issue of “private cloud.” I would suggest that “private cloud” is a completely meaningless term. The term that Dave might use for this viewpoint of mine might be “cloud purist,” but it’s not out of devotion to some holy vision of the “cloud” that I make this distinction. Instead, it’s out of a desire to clear out some of the mess that’s been created with this term. “Cloud” is a useful way of describing the public, provider-owned infrastructure in which new types of services will live. Ideally, its internal mesh of connections and its exact contents should be as nebulous and hidden from an enterprise person’s view as the technology’s namesake. That’s why we’ve always drawn the network as a cloud—it’s a bunch of stuff that swirls together, the individual strands of its connections eventually proliferating to the point where you couldn’t make out a single strand. And yet it kept an overall coherence with definitive boundaries—demarcations, in old telco-speak.
And so if the provider earns your trust—and that’s a big if—it’s fine for you if they look like a cloud. Hopefully, your private network doesn’t look like a cloud to you.
This Week’s UC Weekly
So, What’s Not Changing?
I just returned from a west coast swing, and it included a visit with UCStrategies’ co-founder Jim Burton. Jim and I have worked together on conferences and articles for more years than either of us likes to admit, so it wasn’t all that surprising when, over a beautiful lunch with great wine, we realized we had reached the same conclusion about the current state of enterprise communications and collaboration: The breadth and depth of the changes impacting the business today exceed anything we’ve seen in our careers.
Even for an industry that prides itself on change, there’s virtually no element of the business that’s not in play. Of course, it all stems from the changes in technology—ever-more powerful chips enabling more sophisticated algorithms and processes, which in turn means that each form factor can accommodate higher and higher levels of functionality. Whether you’re talking about more bandwidth or Smartphones that can do everything but sing you a good-night lullaby, it’s all about the chips!
The irony is that chip technology has advanced to the point where the focus of the industry has shifted, from hardware to software. The evolution of communications/collaboration into a software-intensive business sparked a radical change in the cost models for both buyers and sellers, and that has led to a shake-up among the familiar vendors while offering previously unavailable paths to market to new players.
And as communications and collaboration become more tightly integrated within IT organizations, our part of the industry is being impacted by much broader market forces—from the “cloud” and video, to mobility and social networking. As the scope of our niche expands so do the interests of market giants like HP, IBM, Microsoft and Cisco, who are moving to leverage communications and collaboration to drive deeper into one another’s turf.
