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When Microsoft announced OCS R2 last October, the Microsoft message was clear: We Have Arrived. The biggest mystery for many was what took so long? Enterprise customers started buying VoIP around the year 2000; Cisco, new to voice, took the opportunity that disruptive technology presented, and offered a powerful solution. Other new companies emerged, and the traditional players rushed to change their products to VoIP--all while Microsoft largely remained quiet on the subject. (Microsoft’s pre-OCS product, Live Communications Server (LCS), was not positioned as a PBX alternative).

But OCS R2 is out, and Microsoft claims it’s ready to replace the corporate PBX. Traditional TDM or IP--Microsoft suggests both are now obsolete.

OCS does indeed change many rules. On the server side, it seamlessly integrates with other Microsoft servers--specifically Exchange for enterprise messaging. From the desktop side, Microsoft created Office Communicator--the client which integrates with Office. The clients that most of the competition offer are stand-alone; not integrated into MS Office. So with the Microsoft model, you can receive an email from Joe, and from within Outlook (or any Office application) you can see if Joe is online/available and respond via email, IM, or phone. Communicator’s current status is automatically updated by presence, Outlook Calendar, and phone status. Limited Communicator clients are available for several cell phones.

It is easy to see the attraction of such an integrated solution. Microsoft calls it "VoIP as you Are"--not because you already have the server (you don't) and not because you already have the client (you don't), but because you already have Microsoft servers and desktops. Microsoft wants to position their new foray into voice as the safe solution--but is it?

From 1986 to 2000, Microsoft's stock pretty much only went one direction; up. A true powerhouse and amazing company. I remember many of the battles and victories; PC vs. Mac, Word vs. WordPerfect, Excel vs. Lotus, PowerPoint vs. Harvard Graphics, NT vs. Novell, Exchange vs. cc:Mail, IE vs. Netscape, the list is long. Betting against Microsoft, even with odds, was foolish.

But over the past decade, a new or different trend emerged. Since 2000, their stock price knows a new direction; down. They made a number of major mistakes this decade. In Patents, Microsoft has lost the two largest patent lawsuits on record. A few years ago they reached a $1.6B settlement with Sun over Java. In fact, the courts have not been particularly nice to Microsoft in a variety of cases and settlements.

They have a number of products that appear left for dead, including Zune and Windows Mobile (both lost to Apple). Plus quite a few recently-discontinued products include Encarta, FrontPage, Flight Simulator, Truspace, Live Search Books, and the OneCare Security Suite--all gone. Factor in a number of battles where Microsoft is losing, such as IE market share (continues to drop), Email (Exchange and Hotmail market shares dropping), and some major missteps such as Vista that created a public relations mess so deep that not even Jerry Seinfeld could help.

Up to this point, Microsoft has failed with Search, and Google is now attacking Microsoft on many fronts--the Chrome browser, Android on the mobile phone, Google Apps instead of Office, Gmail instead of Hotmail or Exchange, and more. Microsoft blew its multi-carrier, multi model, multi-year cell phone advantage to the Apple iPhone, and now Apple is using its strength with phones and iPods to successfully grow their desktop/laptop products--not to mention those stinging Mac/PC ads which make a mockery of the Microsoft value proposition. Apparently effective based on Microsoft responding with the "I'm a PC" campaign. Did I mention Vista? After years of trying to convince us it was ready--even forcing us to buy it to get to XP--Microsoft stepped up efforts to release Windows 7 later this year.

The fact is, Microsoft is busy on quite a few fronts. There is the EU Antitrust case in process. The Linux threat is old, but continues to grow. Competitors are now using Linux servers to host key business software applications (SaaS), creating real competitive threats to both their server and application markets. Adobe took on Silverlight and is winning over major websites including Major League Baseball and the New York Times recently. The boardroom in Redmond has plenty to discuss without new competition from the likes of Cisco, Avaya, Shore-Tel, Mitel, Digium, and Siemens (to name a few).

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