The incumbent PBX vendors have all faced the challenge of changing their business model--a shift from hardware to software, from selling boxes to providing solutions. The PBX vendors actually have been in the process of adapting for almost two decades: In the 1990s, when CTI arrived on the scene, the PBX industry had to develop more computer expertise; then, beginning around 2000, VoIP changed the game again.
Some PBX vendors have responded to these challenges more quickly and successfully than others, but all have been shifting their product plans, portfolios and competitive positioning.
Now it's the carriers' turn--they need to change their business model and the question is whether they're up to the task. Like the PBX vendors, carriers have been grappling with difficult challenges for 20+ years. The issues include:
* Carrier bypass.
* Allowing competitors to co-locate equipment in their facilities.
* Lower long-distance pricing.
* Consumer migration from wired to wireless telephone service.
* Consumer moves from wireless to wired broadcast media content.
* Keeping up with demand for wireless voice and data services.
* New competition from Skype and Google.
* And the same challenges outlined above for the PBX vendors.
But today, they confront a huge challenge: All of the PBX vendors offer--or are planning to offer--cloud-based communications. It is one thing for the carriers to work with a Microsoft and offer some of Microsoft's cloud services like Office 365; but to also offer Lync call control is quite another matter. This business model change is, rightfully, a major concern to the carriers.
The incumbent PBX vendors have had difficulty facing the new realities of the voice market. They fought VoIP as Cisco came into "their" market and quickly took major market share. When UC first evolved, they ignored the cold reality that call control would no longer be "their" crown jewel. Software-based solutions from Microsoft, IBM and Asterisk have entered the market and are taking market share.
In response, the PBX vendors have, at least from a marketing standpoint, shifted to where they should have been 5-10 years ago: They've become providers of business communications solutions.
Will the carriers go through the same process? Will they struggle to maintain their profitability and market share while the rest of world moves to cloud communications? There are early indications that they understand the problem and are evaluating their options. Some are moving at carrier speed--very slowly--but at least they’re moving. For example, NTT recently moved into the system integration business in a big way with its acquisition of Dimension Data, and other carriers are also expanding their service businesses.
The carriers are embracing SIP, developing their own IP-based call control, or are working with call control partners like Broadsoft so they can control their business model rather then become marginalized by one of several potential "partners."
So how will this cloud battle shape up between the carriers and the UC/PBX vendors? It all comes down to who can offer the customers what they need. A lot will depend on the channel and how the channel business models will change as customers move to the cloud--which I'll discuss in next month's article.
