Score a win for Siemens Enterprise Communications in its bid to grab North American market share and increase its indirect sales: SEN will announce next week that it's concluded an agreement to add a major North American distribution partner: Shared Technologies. I had a chance to talk this morning with Shared CEO Tony Parella and Siemens channel VP Denzil Samuels, and got a look at what they described as a unique service offering that offers a more incremental pricing model. Tony also talked about Shared's pursuit of Nortel Enterprise Solutions, which of course ultimately went to Avaya.
The Siemens-Shared deal is a 5-year distribution agreement that Tony Parella described as "industry-changing." That's because the Siemens-Shared offering will be priced on a seat-license basis, and will be aimed at bringing Siemens OpenScape to enterprises that are looking to migrate legacy systems to IP/Unified Communications, and want to do so on a gradual, incremental basis. Customers can "buy this [OpenScape] technology by the drink, without having to expend a ton of capital dollars," Parella explained.
Some enterprises are seeking this kind of an opex model of technology adoption through provider-hosted services, but that's not what Shared and Siemens are doing here. Customers will own the OpenScape technology, but it will be packaged and priced by seat license.
At least for this phase of the deal, this offering will be the focus of the partnership, rather than Shared embarking on a comprehensive offering of Siemens hardware and software, Samuels and Parella said.
The move comes as much of Shared's customer base--heavily Nortel users--is trying to get its bearings after the year of confusion that the Nortel bankruptcy process produced. For Shared, that meant that the distributor's equipment sales took a beating as Nortel customers retrenched in 2009--"we took a whipping on the Nortel side," he said. "Everybody said: We're sitting on the bench and we're not doing anything until we see what happens to Nortel."
Now that the Nortel situation is resolved, Parella sees "tons of pent up demand" among that customer base, but also sees these customers--and the market as a whole--looking to migrate toward UC in a way that preserves legacy investments, which is the focus of the Siemens OpenScape offering.
The movement in the market is also being driven by SIP technologies, Parella said, specifically the opportunity to implement SIP trunks and use the potential savings from these to fund investments in new UC applications.
For Siemens, the appeal of the Shared partnership is obvious: It gets them into one of North America's largest distrubtion houses--one with a heavy Nortel customer base--at just the moment when much of that customer base is deciding what to do about their Nortel infrastructure. Denzil Samuels noted that Shared has 8 million Nortel ports in North America, about 30% of the Nortel base here--and now Siemens has a strong avenue to this base.
Samuels also cited Shared's strenth as a service company; "they know how to service those [user] companies end to end."
"We should be a very meaningful distributor for them [Siemens] almost overnight," Parella concluded.
Shared made a splash last year when they made a high-profile addition of Avaya to their line, just a couple of weeks after Nortel filed for bankruptcy. Tony Parella said he does not expect the Siemens deal to affect Shared's relationship with Avaya--"This isn't a move in any way against Avaya" or any other vendor Shared works with, he said.
Tony Parella also shared (no pun intended) some background on Shared's pursuit of an acquisition of Nortel Enterprise when the company was on the block mid-last year. While he conceded that Shared might have had to reckon with some of its vendor partners had it acquired a vendor company of its own, he said the idea was for Shared to bring its service emphasis to Nortel, while the bankruptcy would "fix the financial side."
Ultimately, he conceded that Shared just couldn't keep up with the money that Siemens and Avaya--which ultimately ponied up $915 million to get Nortel--were willing to spend. "It was always a longshot for Shared to acquire Nortel," Parella said.
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