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PBX Suppliers: Be Prepared for Microsoft, Be Very Prepared

I attended the first Microsoft Unified Communications Consultant Briefing meeting earlier this month not so much to rehear things I may already have known about the software giant's plans for the telephony system market, but to observe the reactions and listen to the comments of the attending consultants. I can safely say that most, if not all, consultants left the meeting with a more favorable impression of Microsoft's chance of success crashing a market space that has proved invulnerable to more than a few attempts by multibillion dollar companies in the past. Casualties from the past have included IBM, General Dynamics and Rockwell. More recent attempts by companies the likes of Intel and 3Com have met with immediate or gradual failure.I recall conversations I had with more than a few consultants two years ago at the annual Society of Telecommunications Consultants (STC) about the threat Microsoft posed to the existing market structure, already put out of kilter by Cisco Systems a few years back. The general tone of the consultants was best described as skepticism, about the company's commitment, chance of success, and/or timetable for success if it came at all. At the time OCS 2007 Release 1 was less than an impressive threat to existing telephony systems. In the interim Microsoft has unveiled Release 2 and has briefed a select few on future releases. Although the next major release was not discussed last week, the information imparted to the consultants, about products, services, distribution plans, and customer trials, was positively received by most. I believe that the general impression one walked away with was how far Microsoft has come in a short time and how far it would go within the next few years.

It took Cisco Systems the better part of nine years to challenge the global market leaders for the top position, leveraging its dominant position in the world of data communications networking. In an age of acceleration and contracting product life cycles, I believe Microsoft, leveraging its desktop applications dominance, has a strong chance to replicate Cisco's success in less time. Virtually beginning at the starting line today, Microsoft by the middle of next decade will pass many current competitors on the market share ladder of success.

Following the next major OCS 2007 release, Microsoft will actively compete in the standalone systems market, not merely sell the solution behind installed telephony systems for presence, IM, or softphone requirements. Microsoft solutions today are being used as the primary telephony system in trial operations. What impressed many consultants, me included, are the size of the trial implementations. Without revealing specific Microsoft secrets I can state that we are not talking about 50 or 100 station users per trial, but something more than an order of magnitude greater. Companies such as Shell and Sprint have already spoken publicly about their experiences with Microsoft, and I am sure many more will be coming forward during the next year.

Is it possible that Microsoft won't succeed? Yes, there is the possibility, but I am more inclined not to bet against them. The company has the resources, IT market clout, and impetus to succeed, if only to protect its other software solutions. The future threat of Google as a cloud services provider of many things currently Microsoft--operating systems, Internet browser & search engine, office productivity suites, and messaging, to name a few--is enough to drive any company forward.