Voice-Centric vs. Data-Centric

Calvin Cooke has been through booms before. As president and CEO of Brainstorm Industries in Durango, Colo., he ran his company as a Web integrator and developer during the Internet craze.

But three years ago, Cooke decided to embrace VoIP. Unlike some, Cooke cast his fate with data-centric vendors, which have come a long way since getting into VoIP. When Cisco, a top Brainstorm networking partner, was lukewarm on the IP-telephony market, 3Com swooped in and helped Brainstorm build a practice that grew quickly.

Adopting early helped Cooke establish a solid customer base; when Cisco came to market with VoIP products, Brainstorm began doing more business with the vendor again. Soon Cooke's Cisco sales were growing, and its VoIP practice earned so much praise that one customer demanded Cisco make Brainstorm a partner, which it now is--at the Premier level.

The reborn partnership has been mutually beneficial. And any fears of overdistribution of VoIP technology, too much competition and resulting declines in profit margins have not been an issue. As a result, Cooke has created a dedicated Cisco business, dubbed Brainstorm Networks, and hired a former Cisco salesperson as its newest vice president of sales.

"I made a commitment to Cisco. We reinvested a lot of profits into Cisco training and the overall partnership," he says. "I told them I would open an office in Denver, and we did--right inside Cisco's building--and we opened another office in Phoenix, so we're not just a rural company anymore."

Brainstorm saw more than $3 million in sales in 2004 and is predicting three times that amount for 2005 revenue.

In contrast, other companies are pursuing VoIP with the help of more voice-centric vendors. That includes Xeta Technologies, which approached VoIP from the telephony direction. Based in Broken Arrow, Okla., the solution provider formed a landmark partnership with Avaya in the late 1990s and began developing IP-telephony solutions in 2000, long before PBX conversions became popular.

The company, which is publicly traded on Nasdaq, pulled in more than $58 million in sales for its fiscal year 2004. That was up 12 percent year-over-year, thanks to an increasing interest in VoIP within the midmarket. Xeta completed an IP-telephony system for a major car dealership in Omaha, Neb., last year, teaming up with Avaya and Westcon Group's Voda One division. Since the deployment, the car dealership has seen its sales increase.

"We provided the dealership with a fully integrated, server-based VoIP system," says Larry Patterson, executive director at Xeta. "The biggest benefit is they now have a customer-centric communication system. Instead of adding more phone lines, they can add applications to enhance their system."

So which approach is right for you? Jeff Snyder, vice president and chief analyst at Gartner, says both types of companies have advantages and disadvantages for VARs and customers. He says Cisco, for one, is trying to address any voice-related shortcomings by requiring stricter voice certifications from partners. "They've also done a good deal more training and are making serious attempts at bringing more voice-oriented channels into their strategy," he says.

Telecom-oriented vendors have the opposite problems. "Avaya and Nortel had all of the voice knowledge, but needed to be able to speak to data-oriented buyers," Snyder says. "I believe the traditional voice sellers were a little faster to recognize that they needed to talk data than the data people recognized they needed to talk voice. When you're selling IP telephony, you need to talk both."