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Polycom Acquires Obihai to Bolster Endpoint Business
As I wrote in a No Jitter post late last year, Polycom CEO Mary McDowell is busy delivering on her endpoint-first strategy. Polycom accelerates that transformation this week, announcing its intent to acquire Obihai Technology, a VoIP solutions company.
In case you're not familiar with Obihai, it was founded in 2010 by Jan Fandrianto (CEO) and Sam Sin (VP Engineering), both of whom also created Komodo Technology and Sipura Technology -- two companies Cisco acquired and rolled into its Linksys division (subsequently sold to Belkin). Interestingly, Polycom's new EVP of Products and Solutions, Tarun Loomba, had worked with the Komodo and then the Sipura teams during his tenure at Cisco Linksys -- so this will be his third go around with Fandrianto and Sin.
A first glance, the Obihai website reveals a couple of things. First, the website is woefully outdated; it looks like something from 1995. So, the company's success has come on the strength of engineering and not slick marketing.
Second, you'll see the company offers a broad range of IP phones, analog terminal adapters (ATAs), and other devices that IP telephony service providers (ITSPs) sell to consumers and businesses. However, Obihai's strength is its software stack. It's designed to be highly modular and flexible so it can address specific service provider needs. On the surface, the voice offerings of one ITSP or another may seem very similar, but each one has its own specific requirements -- and Obihai's software enables service providers to make changes, add features, or quickly do anything else requested.
The software also has a number of features that make the Obihai devices easy to deploy, manage, and maintain. For example, OBiTALK Link enables Obihai phones and ATAs to link to one another for seamless connectivity and call transfers. The company aggregates the data from the phones and presents health status, deployment information, and basic trending and other analytics, via a portal or APIs. Polycom has some of this capability already, but the Obihai portal is more advanced.
As an example, Polycom provides its service provider partners basic mean opinion score information, which is certainly useful for alerting them about problems. But Obihai provides richer data, such as the number of reboots, total uptime, and other information that service providers can use to help diagnose issues. The analytics are basic, but the company does gather a tremendous amount of data that the smart folks at Polycom should be able to utilize to provide much deeper insights.
Ready for the Big Time
I poked fun at Obihai's website, but the company is a classic engineering firm that needs a larger company to take it to the next level. As I mentioned, it has a great software stack, and is collecting a tremendous amount of information, but it's only scratched the surface of what's possible. Polycom can drop the existing products, particularly the ATAs, into its channel and significantly grow that business. It's never offered ATAs before, so I'm sure some partners are licking their chops as that prospect. In addition, Polycom can drop Obihai's software into its voice -- as well as video and meeting room -- products to improve manageability. As VoIP providers shift to UCaaS, the data, diagnostic information, and insights become critical to their successes.
Also interesting is that Obihai has a consumer business that works through Google Voice. Polycom hasn't previously established relationships with ITSPs focused on consumers and micro-businesses since it hasn't had appropriate products for this market. I don't expect Polycom's focus to shift going forward, but having that added reach will certainly help it.
The Real Deal
This is the first acquisition for Polycom under McDowell's leadership, and it's important for a couple of reasons. First, it adds great technology and software that Polycom can use to improve its own products and will open up new markets and opportunities. Obihai's portal and APIs could wind up being the crown jewel of the acquisition, providing Polycom the ability to add more data and deeper insights for service provider partners. The most successful companies in the future will be the ones with the data and machine learning algorithms to interpret the data, and Polycom's larger engineering team should be able to accelerate what Obihai has put in place.
Lastly, from an internal, change-the-culture perspective, the Obihai purchase should be a shot in the arm for employees -- company leadership is putting its money where its mouth is. The direction that McDowell laid out is real, and not just lip service, and this acquisition shows that Polycom will make investments where necessary. It's a small acquisition, but could pay big dividends in the near future.