Hyperbole Reigns As Unified Communications Battle Heats Up

Solution providers in the unified communications space are still puzzled over Cisco executives' recent assertion that Microsoft and HP intend to move their unified communications (UC) business away from the channel.

In a fit of bombastic zeal earlier this month at Cisco's Partner Summit, Don Proctor, senior vice president of Cisco's software group, used the term "cutting you out of the equation" to describe the coming scenario solution providers will face in the UC space.

Proctor didn't offer any support for his theory, but the fact is that Microsoft and HP are two of the most channel-friendly companies in the IT business, and to suggest that they'll cut partners out of the loop in UC is like claiming that McDonald's is planning to quit the hamburger business and start selling kelp tacos.

"Phone service is even more critical to most businesses than their IT infrastructure. It's hard to imagine anyone opting to entrust their phone service to a vendor without a strong local presence," said Marc Harrison, president of Silicon East, a Microsoft solution provider in Manalapan, N.J.

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The recent Cisco broadside starts to make sense when viewed through the lens of its growing competition with HP, which reached a boil earlier this year when Cisco revealed its intention to enter the server market.

Cisco has to be irked by HP and Microsoft's recently announced four-year, $180 million global initiative to work together to deliver integrated unified communications and collaboration solutions. The initiative will result in solutions that weave together Microsoft's Office Communications Server, Exchange and SharePoint software with HP's smartphones, servers, storage and switches.

"Cisco has to be concerned about this, because if Microsoft and HP are able to rally their partner base around their joint offering, Cisco has a lot to worry about," said Harrison.

Meanwhile, demand for UC solutions shows no signs of slowing. Forrester Research recently estimated that 84 percent of enterprises in North America and Europe are evaluating, piloting or implementing UC and collaborative solutions. Forrester expects the UC market to grow at a rate of 35.9 percent through 2015.

As UC grows more popular, Cisco will also find itself battling with Microsoft and HP for the talent necessary to deploy UC solutions, which requires certain skills that fall outside the purview of traditional integrators.

Next: The Coming UC Talent Crunch

During the last few years, Microsoft and HP have been working to enable an additional joint set of partners with UC expertise, offering them marketing development and technology-specific support. Jay Lendl, Microsoft practice director with Minneapolis-based Analysts International Corporation, sees this as an example of strategic planning against Cisco.

"Cisco offers a complete end-to-end unified communications offering, while HP needs to partner with Microsoft to achieve this. Therefore, HP needs Microsoft to be able to compete against Cisco -- they can't be as pervasive otherwise," said Lendl.

Solution providers with backgrounds in telephony integration and data convergence are best equipped to capitalize on the coming wave of unified communications demand. But for VARs to succeed, they're going to have to invest in training the right people in their organizations, or bring in voice application and protocol experience from outside.

Lendl sees Cisco's intimations of HP and Microsoft going direct with UC as a sign of the intensifying competition for talent. "Cisco's trying to create a partner-friendly environment for UC, and they're looking for a chink in the armor of Microsoft, perhaps in the hope of picking up frustrated partners," he said.

Cisco is likely basing its claims on the fact that HP and Microsoft are launching a set of UC-related services that encompass assessment, architecture planning and design, implementation, monitoring, management and support. HP is also flexing some of its considerable services muscle by dedicating a worldwide team of services professionals to support the HP-Microsoft UC solutions.

"Will they do some direct? Absolutely. HP has a services arm that needs to make money," Lendl said. "But in the grand scheme of things, the ability of services arms to address the actual UC market is pretty small. There will always be joint programs that have a direct component, but the broad channel opportunity will always be there."

What's clear about the Cisco-HP-Microsoft saber rattling is that it's already benefiting customers and channel partners from a value standpoint. HP's ProCurve networking division has been touting the lifetime warranty on its switching portfolio as a competitive advantage and Cisco has responded by introducing its own limited lifetime warranty on Catalyst E-3000 and 4500 switches.

Of course, this sort of healthy competition bodes well for the UC space because it gives solution providers the ability to bring a better product to market, says Rick Rumbarger, vice president of product marketing at Apptix, a Herndon, Va.-based solution provider.

"UC is always going to be a complicated sale. You have to have a mature channel that has skills in both voice and in networking and connectivity, and education is a key part of making that happen," Rumbarger said.