Microsoft Exec: HP Partnership Ruffled Cisco's Feathers

Microsoft's unified communications partnership with HP has clarified battle lines in the fast-warming UC market and led to some rather bombastic statements from Cisco. But Stephen Elop, president of the Microsoft Business Division, insists that Microsoft and Cisco will continue to adhere to the spirit of co-opetition as each tries to carve out its share of the UC market.

Cisco recently declared that Microsoft and HP will cut partners out of the loop in UC. "Don't buy into the hype. This is about HP and Microsoft taking the business direct and cutting you out," said Don Proctor, senior vice president of Cisco's software group, at the networking giant's annual partner conference in June.

However, Elop insists that nothing could be further from the truth. "I think that's a little bit of [fear, uncertainty, and doubt] being tossed into the mix by Cisco," Elop said in an interview earlier this month. "[Microsoft's deal with HP] may have ruffled some feathers at Cisco, and I'm sorry that's the case."

In May, HP and Microsoft joined forces on a four-year, $180 million partnership to develop, build and service unified communications and collaboration solutions. Microsoft believes that the software-only approach will essentially displace PBX over time, whether it's traditional PBX or the IP PBX that Cisco offers. Nonetheless, Microsoft will continue to work closely with Cisco to develop new opportunities in the space, Elop said.

"Our partnership with HP gives us some really interesting capabilities to have both the network components and devices, as well as the software you need to make that whole," Elop said. "At the same time, we also recognize there are situations where elements of our UC solution will have to interoperate with Cisco's."

Neil Brenner, vice president of converged technology at Consolidated Technologies, a Port Chester, N.Y.-based solution provider, says it's too early to tell how things will shake out in the UC space, but at this point in time Microsoft's strategy has some important advantages. "Everyone is going to leverage SIP, and that puts Microsoft in the driver's seat," Brenner said. "This enables them to decouple users from the physical hardware at their location, and that's important."

In addition to the technical aspects, Microsoft's partnership with HP offers competitive business advantages, says Jay Lendl, Microsoft practice director with Minneapolis-based Analysts International Corporation.

"When really big UC deals come up, Microsoft is going to reach out to HP, and vice versa. They'll be able to answer every question on those formal RFPs, and that means they'll have a better chance of winning the biggest deals than they would have if they were going up against Cisco alone," said Lendl.