Brian Riggs
Brian is a member of Ovum's Enterprise team, tracking emerging trends, technologies, and market dynamics in the unified communications and...
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Brian Riggs | September 30, 2013 |


SMB Options for Lync: Services

SMB Options for Lync: Services Hosted options for Lync remain a tough nut to crack, especially when it comes to providing Lync PBX functionality.

Hosted options for Lync remain a tough nut to crack, especially when it comes to providing Lync PBX functionality.

Editor's note: The is the first of two parts on Lync for SMB. Part 2 will discuss Appliances.

SMBs have been a hard nut for UC innovators to crack. These customers' extreme sensitivity to price does not mesh well with solutions that typically cost a premium over the low-cost telephony systems and Centrex-like services that smaller-sized companies typically purchase for business communications. In recent years I've seen vendors release, rejigger, re-release, remove, and replace their UC systems targeted at SMBs. And--perhaps out of sheer frustration--at least one vendor that's strong in the mid-market but struggling with SMBs, redefined "mid-market" as businesses with between 5 and 5,000 employees. So--presto!--no more SMB problems because SMBs no longer exist. That's the magic of marketing.

But there are other options besides closing one's eyes, plugging one's ears, and pretending the SMB problem doesn't exist. Microsoft has been one of the vendors struggling to gain any kind of meaningful traction in the SMB UC space (but, mind you, is not the vendor I was just goofing on). So this week I'm going to look at a few of the ways Lync is being positioned in the SMB space.

Option 1: Lync Online.
Lync Online, of course, is the vehicle Microsoft drives into the market for SMB UC solutions. This cloud-based version of Lync delivers IM and presence and Lync's various document collaboration functionality. It also provides voice and video between Lync endpoints, and used to offer a Lync-to-phone feature for dialing out to the PSTN. Telefonica's Jajah provided the connectivity services that powered Lync-to-phone, and several other providers were expected to follow suit. But others didn't, and Jajah quietly discontinued the service earlier this year.

Even if there is another way for users to place calls outside its walled garden, Lync Online does yet support Enterprise Voice, the set of telephony features that make prem-based Lync Server a viable alternative to traditional PBXs. Back in February, at its superb, first annual Lync Conference, Microsoft said Lync Online would be getting Enterprise Voice within the next 18 months. However, I heard that at the Worldwide Partner Conference this summer Microsoft executives were still saying that Enterprise Voice in Lync Online is 18 months out. And when earlier this month I asked for an update on this, Microsoft spokes-folks now won't comment on this particular product roadmap item. Without more of a concrete delivery date I'm worried that Enterprise Voice in Lync Online, which IMHO should have been available some time ago, will not be offered for some time yet. Which is providing opportunities for others....

Option 2: Multi-tenant hosted Lync from service providers.
The first of these others are service providers that have built out hosted Lync services with full Enterprise Voice, and target these services specifically at SMBs. These are curious things, in that the services are not based on the hosted Lync services platform Microsoft has developed specifically for service provider use. (The reason: Like Lync Online, this platform also lacks Enterprise Voice.)

These services are also not the same as the hosted Lync services that pretty much all major and many minor providers are now selling to large enterprises. (The reason: Those services tend to use a multi-instance architecture that doesn't tend to scale down cost-effectively below 1,000 or so licenses. *Begin shameless plug * Incidentally, Ovum clients have access to my series of reports on these multi-instance hosted Lync services for enterprises. *End shameless plug*)

Rather, there's a set of providers that have combined the otherwise premises-based Lync Server with the multitenant service-delivery platform; this helps make it cost-effective to provide smaller-sized businesses with a fairly uniform, generally non-customizable set of communications services. Some of these include:

ConnectSolutions CoSo TeamUp, launched in early 2012 after a year-long beta by NextUC which at the time was a division of CallTower. ConnectSolutions earlier this year acquired NextUC and this week rebranded and repackaged NextUC's multi-tenanted hosted Lync service.

The three-to-five minute "instant on" set-up time remains from the previous offer. New is multiple tiers of services that include an IM-and-presence-only Basic option; IM and Enterprise Voice Complete option with no SLA and only email/web-based customer support; and an IM and Enterprise Voice Premium option with live support and an SLA of either four or five nines. ConnectSolutions has about 200 businesses with several thousand Lync end users signed up for the multi-tenanted Lync service, with a dedicated Lync service available for enterprises or SMBs requiring a customized service.

Colt's Lync Secure Instant Message with Presence. Part of the Ceano set of SME Cloud Services that was launched earlier this year, Colt Communications' hosted Lync service targets businesses with 25 to 500 seats. The Ceano services not only include hosted Lync Server 2010, but also hosted Exchange, file sharing, backup, and a SaaS platform that can deliver other applications from the cloud. The Lync component offers IM and presence only, with web conferencing on the roadmap but no Enterprise Voice. Pricing ranges from £4 ($6.47) to £10 ($16.19) per user a month. The Ceano services are available in Western Europe, and run on a multitenant architecture built by ThinkGrid, a company Colt purchased last year.

Intermedia's Lync Secure Chat & Conferencing. Intermedia launched its hosted OCS service in 2008, switched to Lync Server 2010 when that product shipped, and switched again to Lync Server 2013 in late 2012. The Lync offering is part of Intermedia's larger Office in the Cloud set of services, runs on a multitenant platform of Intermedia's design, and has published pricing details. It does not support Enterprise Voice, but can be integrated with Intermedia's hosted PBX platform so end users can dial via click-to-call from Lync and Exchange clients, as well as see presence information that shows whether their contacts are currently on the phone.

It can be sold to businesses needing as few as three seats...or it can scale to thousands of users...but it has a sweet spot of 100-500 seats. SVP Prasad Akella says there are currently 32,000 Lync users and over 700,000 Office in the Cloud users in 95 countries, though the service has sold mainly to businesses in the US and the UK.

StartReady Hosted Lync launched in 2012 and currently is available only in the Netherlands (where the company is based). StartReady is a specialist provider of Lync appliances, a topic that I'll address in my next piece on "SMB Options for Lync: Appliances". But founder Lucas Wensing says the company is finding that appliances generally sell to businesses needing more than 100 seats, but not to those needing fewer than that. So StartReady put Lync on a multitenant platform to deliver a cloud-based service, which includes the full Enterprise Voice feature set, for the sub-100 market.

The list could go on. Sipcom Hosted Lync and ThinkTel Hosted Lync are other hosted Lync services that can be adopted either with or without Enterprise Voice. When deployed with Enterprise Voice, the price ratchets up quite a bit. For example, Connect Solution's CoSo TeamUp costs $1.99 per user per month for hosted Lync without Enterprise Voice, rising to $24.99 to $34.99 per user with Enterprise Voice. ThinkTel's service costs $10 per user without and $32 to $42 with.

Costing a pretty penny will give pause to many a cost-conscious SMB, which is perhaps one of the reasons Microsoft is not rushing headlong into the SMB telephony space with a hosted service of their own. And as you can see, like Microsoft itself, not all providers have cracked the Enterprise Voice nut when it comes to hosted Lync for SMBs. This is making room for another service option....

Option 3: Office 365 integration with separate hosted UC service

Another route to adding the telephony to otherwise telephony-less Lync Online is to integrate it with a different telephony-centric UC service. Good examples of this are Vodafone's One Net Express and One Net Business, IMS-based UC services targeted at businesses with up to 25 and up to 250 employees, respectively. The services are offered internationally, but offerings in Spain are different in that they have been very tightly integrated with Office 365 and Lync Online. Through this integration, One Net Express and Business customers can use their Lync client to place calls to and receive calls from the PSTN using their existing tariff plan.

"Incoming calls to their One Net number ring both their telephony end points and Lync simultaneously," a company spokesman explained to me. "Outgoing phone calls can be made directly from the Lync client, presenting the Vodafone One Net phone number as the caller ID and use the existing customer airtime, not a separate tariff."

So it's a bit like the discontinued Jajah service that enabled PSTN calling from Lync Online. But with Vodafone there's also an FMC element to it and shared caller ID. It's an interesting approach in that both telephony and Lync come from different providers' hosted services and, together, provide SMBs with a Lync Online experience with standard business communications features. Vodafone wants to expand this offering beyond services offered in Spain, but it's unclear when that will be. While they work on it there are other options for SMBs interested in Lync...and which I'll detail in my next blog.

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