Communications Wake-Up Call

Microsoft's recent flurry of activity in the unified communications space has put channel partners as well as its competitors on notice: It's not a market to be ignored.

Microsoft now is set on a collision course with current players such as Avaya, ShoreTel, Siemens, 3Com and—most directly—Cisco Systems. It is gunning for a big piece of what it identifies as the $43 billion communications market opportunity, and it's planning to tap solution providers to help get it.

For the channel, Microsoft's splashy new unified communications strategy means two things. First, the market is about to get a whole lot hotter as the world's largest software company brings the full weight of its marketing might to bear in order to popularize the technology.

Second, channel partners need to prepare for the inevitable impact and will face tough choices as they evaluate their current vendor partnerships to see where Microsoft could—or has to—fit in. The waters are murky for some partners because Microsoft already has partnerships with many of the very companies it will now compete against.

"It's certainly not something you can ignore," said one Cisco solution provider who asked not to be identified. "Today we can choose to ignore the Nortels, Avayas and Mitels and ride the Cisco horse, keeping ourselves busy trying to keep up with demand. But we can't ignore the fact that Microsoft is on the desktop at every site we go to and owns the network operating system. Customers are naturally going to be interested in it."

With new voice and unified communications products such as Office Communications Server 2007 and Office Communicator 2007 promised for next year and a brand-new partnership with telecom vendor Nortel Networks now in hand, Microsoft CEO Steve Ballmer has left little doubt as to his intentions.

"You can clearly say that Microsoft, with Nortel, is in the business not just of unified communications, but in the business of VoIP," Ballmer said during a July press conference to disclose the new alliance.

The four-year joint development, sales and marketing pact is the deepest yet between the Redmond, Wash.-based company and an IP telephony vendor.

The partnership followed the June unveiling of Microsoft's unified communications strategy, a vision that includes the breakdown of barriers between technologies such as e-mail, instant messaging, conferencing and VoIP to create a paradigm where people connect more quickly and collaborate more efficiently.