Now that the dust has settled after Enterprise Connect 2013, and I've had a chance to both reflect on what I heard and download the slides (to make sure my memory was correct), it's time to talk about the looming "Battle over TCO".
During the conference, Robin Gareiss, EVP and Co-Founder of Nemertes Research presented an eye-opening session titled "Making the Business Case for IP Telephony and Unified Communications", which included some analytical research they had done on the actual cost of Unified Communications systems from a number of different vendors. Robin presented the results of a Nemertes survey, finding that NEC and ShoreTel had the lowest total first-year costs for IP Telephony, while Microsoft had significantly higher first-year costs. How much higher? According to the survey, Microsoft users reported almost three times the costs that ShoreTel users reported. (Robin also authored a recent No Jitter post on this issue of Lync costs.)
The increased costs reported in the survey were predominately in the operational side of the equation--the capital and implementation costs between the various vendors were not far off. Operational costs include the staff time, equipment maintenance, 3rd party maintenance, training and certification.
While I'm sure the data presented was accurately collected, computed and shared, it just doesn't match up with what our customers are telling us. Something is missing, so I took it upon myself to get to the bottom of this mystery....
So, like any good speaker at Enterprise Connect, I tossed the problem out to the audience at my next break-out session (and frankly to anyone else that would listen). "Why is Nemertes reporting that the operational costs are so high for Microsoft vs. others?"
A Sr. Network Engineer for a health care provider in Tennessee was first to jump on the question--prefacing that the report did not match their experience, and he surmised that one of the issues was the difficulty now involved in accurately measuring the staff time needed to implement Lync. One of the issues measuring the costs of Lync is that there is no IT vs. Telephony split in the organization anymore. In the past, distinct, separate staff took care of the data and voice networks, so it was easy to measure. Now, the IT staff takes care of the network, and Lync is just another application for that group to manage.
The open, multi-vendor approach of "best of breed" UC seems to be another area that affects operational costs for Lync. If the software, servers, phones, headsets and network elements all come from different vendors, the training and certifications required for a Lync deployment can get daunting. That training often never gets completed and as a result, little problems take a long time to solve, causing the time/cost of operations to further increase. Having one vendor or at least reducing the number of vendors improves operational costs.
The maturity of Lync seems to be a contributing factor too--during Robin's session, she did note that there was a correlation between the maturity of the platform and the operational costs--Microsoft being one of the new kids on the block, doesn't benefit from a well-educated customer base. Other more mature platforms (ShoreTel, Cisco, Avaya) had well trained partners and channels.
I also felt that the Nemertes survey should have included experiential results from the cost savings the various platforms--how was your travel budget affected by implementing UC? How much did your costs of conference calling change? What was the impact on time-to-resolution for your helpdesk? All are very hard costs that can be measured and should have been included in the report.
My biggest concern from Enterprise Connect 2013 and this one report is that the vendors of the UC systems will start a "my TCO is lower" war in their marketing messages--which will further confuse those CIOs that are still on the fence. The reality is that our customers are telling us (one after another), their migration to UC has transformed their businesses, reduced costs and improved productivity. What's not to love?
Looking forward to EC14 next year, but until then, do share your thoughts and feedback.
You can reach Alan at: [email protected]
