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Mitel's New Virtualization Reality

Did you know that there's more to Las Vegas than the Strip? I spent a very pleasant couple days a few miles outside of the strip at the Red Rock Casino and Spa for Mitel's Analyst Conference, held in conjunction with its partner summit. We heard from Mitel execs, partners, and customers about Mitel's new products and focus. Mitel is following through on Don Smith's favorite quote--"If change is inevitable you should drive it." Mitel is doing just that by transitioning to a software vendor, focusing on virtualization, hosted services, software as a service, subscription services, and more.In a UC world, the value of the switch changes, as call control becomes an application, and the IP PBX basically becomes a feature server. Rather than fighting the inevitable, Mitel is aggressively moving in this direction, offering software-only solutions. To that end, Mitel is focusing on communication applications, notably contact centers, collaboration, messaging, mobility, and the new Mitel Communications Director (MCD), a new software-based call control platform. By separating out the software from hardware, Mitel Communications Director will essentially become a feature server in a software-based telephony environment.

While we got to hear from many Mitel execs, my favorite parts of the conference were the user and the reseller panels. It was interesting to see how the users varied from each other in terms of their technology adoption. The customers on the user panel spanned the spectrum in terms of types of users--from mainly IP users to mainly TDM users. While one, Central Technology Services, has Microsoft OCS deployed using Mitel's Live Business Gateway to connect with OCS, another, SkillPath Inc., has only 20% of its users on IP and doesn't see the need for unified communications at this time. Jason Spainhour, IT Director of SkillPath noted, "A phone is a phone is a phone and when it rings you pick it up and when you want to call out, it better have dialtone."

Three of Mitel's channel partners discussed what they're seeing in the market, and as expected, the need to cut costs and save money is omnipresent. The resellers noted that all customers are asking how they can cut costs and expenses and become more efficient. One of the resellers noted that he's doing a lot of network analysis to help identify where customers need to save money. Another noted that audio and web conferencing have distinct ROI and that customers are moving to premise-based audio conferencing systems to save money. None of this is new information, but it reinforces what we've been seeing over the past few months. It's clear that companies are looking to survive and save money and are only investing in technology to help get them to the next level--no one is spending money on technology just for technology's sake.

The overall theme of the conference was about Mitel's move toward software and virtualization, which I was glad to hear. Mitel is being aggressive and taking an early leadership position in this area, especially virtualization. The challenge will be Mitel's ability to recruit new channel partners, and help some of its existing partners prepare for these changes. Mitel will have its work cut out for it in terms of retraining existing partners and recruiting new partners who understand the software world, virtualization and cloud operating systems, centralization, etc. Not all of its partners will make it, and there will certainly be a shakeout in terms of those who are ready to move into the software world, and those who want to remain traditional telephony vendors.