Competitors of Tomorrow?
There are two powerhouse companies with potential to be major enterprise communications system competitors of tomorrow: Microsoft and IBM. Of the two, it currently appears that only Microsoft has definitive plans to place both feet squarely in the arena with a full-featured voice offering; IBM is and will remain a player in the market as a system integrator and reseller, but has no plans to develop and market its own voice communications solution to replace today’s standalone IP telephony systems.
Microsoft’s Office Communications Server (OCS) 2007 enables an integrated user experience via Microsoft Office Communicator 2007 client by providing unified voice capabilities, call management, multiparty video, on-premise web conferencing, presence status and control, enhanced business instant messaging, data and application sharing, federation capabilities and Public IM connectivity. It also delivers enhanced security, logging and archiving, and works seamlessly with other Microsoft products such as Exchange Server.
From a voice communications perspective, OCS 2007 can support a PC client as a softphone telephony endpoint, allowing users to make and receive telephone calls and bring control of the PBX telephone instrument to a users’ desktop experience. Station users can initiate VoIP calls directly on their PC without a desktop telephone, simplifying their communications experience and enabling more centralized IT systems administration.
For those who prefer a more traditional experience, Microsoft (through its partner program) has also introduced an IP desktop telephone instrument that operates independently of the PC client, and a USB telephone instrument that works behind the PC client.
The current set of OCS 2007 voice features is relatively basic compared to full-featured PBX systems, but plans are in motion to sufficiently enhance the feature set to allow the Microsoft offering to replace a standalone voice communications system. This was the message of Bill Gates during his well-publicized presentation last year at the OCS 2007 kick-off meeting.
The complete system solution would require dedicated servers to support conferencing and IVR/speech recognition capabilities in addition to media gateways for traditional telephony interface requirements, e.g., PSTN trunks. It would resemble today’s client/server softswitch IP telephony design, but support a full array of unified communications features and services including traditional telephony.
The company’s competitive advantage is that customers will have many Microsoft-based client/server elements in place when the full featured voice package is available, effectively negating the need for a peripheral voice-centric system. The evolving convergence of voice communications with data, video and messaging communications services will obsolete single-medium-centric solutions, such as a PBX.
Microsoft’s potentially dominant unified communications market position will facilitate its emergence as a real time voice communications solution competitor. If Microsoft’s plans are successfully carried out, the traditional voice communications system suppliers better start developing competitive marketing strategies yesterday.
IBM, also a strong player in today’s evolving unified communications market, is embarking on a different strategy. It may be called the “Counter-Microsoft” strategy, because IBM is working closely with several voice communications system suppliers, including Siemens, Nortel, and 3Com, as a repackager/reseller of these companies’ voice system offerings.
IBM’s market approach is to leverage a peripheral voice communications system, not fully replace it, although IBM Lotus Sametime already includes some limited voice communications capabilities. Lotus Sametime supports: presence awareness; real time collaboration tools; integration with Microsoft Office, Lotus Notes and Microsoft Outlook; video and VoIP chat in the enterprise; telephony Integration; file transfer and screen capture; Web conferencing; mobile clients; and support of Public IM federation.
At VoiceCon San Francisco 2007, IBM announced Lotus Sametime “Unified Telephony” software. “United Telephony” is designed to make it easy for station users to access and manage telephone communications from inside the Lotus Sametime or Lotus Notes client.
The Lotus Sametime “Unified Telephony” offering will extend the value of Lotus Sametime software as a platform for communications by providing the ability to: initiate phone calls and take action on incoming phone calls from within the Lotus Sametime or Lotus Notes client on the front-end; connect multiple, mixed telephony systems on the back-end; and see phone presence in your Lotus Sametime client. Planned features include: click-to-call/click-to-conference; aggregated Telephony/IM presence; incoming call management; embedded softphone; and PBX integration. More Lotus Sametime releases are scheduled for this year.
For those too young to remember, IBM’s past foray into the voice communications was not a happy one. IBM acquired Rolm more than 20 years ago and sold it off to Siemens in 1990 after discovering PBXs were not a high-growth or high-margin business. Although some rumors have circulated that IBM will acquire Siemens Enterprise Communications, this outcome is doubtful. IBM’s best strategy may be to work with the established voice communications system suppliers to tightly integrate their unified communications capabilities with the full featured standalone telephony systems. Continuing in its role as an experienced and full service system integrator would be less risky than competing against Microsoft and the voice-centric players.
Besides Microsoft, there is another potential future competitor to challenge today’s voice communications system supplier hierarchy at their own game: Google.
Google Talk, an offshoot of Google’s IM service, was made available more than two years ago, but it is a very basic talk chat service. Last summer Google acquired Grand Central Communications, a company that allows users to link multiple phone numbers to one life-long central number and manage it all—including voice mail—online. Google’s blog stated “We’re particularly excited about this because it ensures that not only will we have the resources to continue to bring you even more innovative communications features down the road, but that we will be able to continue to offer you the service, with many features for free, for a long time to come.”
Google last year also shared its plans for a Google cellullar phone platform. Google’s interest in wireless communications was further boosted recently when the company was among those named by the FCC who will be bidding for radio spectrum at this month’s auction. A free Google wireless service supported by advertisements could prove very tempting to a large constituency of current cellular service subscribers. On the enterprise front, Google has not hidden its intentions to rival Microsoft for desktop software applications. Free unified communications tools, including telephony, could totally turn the current market for enterprise communications on its head.
Google advertising revenues continue to grow at an unprecedented rate, allowing the company the luxury of funding ventures in market spaces far removed from its original Web search engine. They certainly have the financial resources to attack the enterprise communications market, but as of now this is only speculation.
A Few Final Words
Summarizing where the enterprise communications market stands right now and where it is likely to go during the next few years:
- IP telephony is entering its mature phase with an increased emphasis on applications.
- New competitors, like Microsoft, are certain to enter the market from peripheral product/service markets and threaten to upset the current competitive equilibrium
- Customer demand for unified communications solutions will develop slowly, but eventually replace today’s standalone telephony systems as the focal point for enterprise communications
- Mobile communications devices will replace a growing number of desktop wired terminals as the primary voice communications portal, particularly among professional knowledge workers
Allan Sulkin is founder and president of TEQConsult Group, and was a contributing editor to Business Communications Review for two decades. Sulkin has almost 30 years telecommunications industry experience and is recognized as the industry’s most prominent (and outspoken) enterprise communications market/product analyst. His management consulting services are used by many of the companies mentioned in this article, some of which heed his advice.
