Unified Communications Nation

A SearchUnifiedCommunications.com blog


January 13, 2010  10:17 PM

The IP PBX: Who needs it?



Posted by: Shamus McGillicuddy
Cisco, fixed, Google Voice, IBM, IP PBX, IP Telephony, Jabber, Microsoft, Mobile, Office Communications Server, presence, Sametime

Blogger Greg Ferro (Etherealmind.com) claimed last week that the days of the IP PBX are numbered. It’s hard to argue with him. The IP PBX – all PBXes, really – will go away. The only question is when?

As Ferro points out, the original value proposition of the PBX is losing its appeal.

The PBX, or Private Branch eXhange, was designed to save a company money. It allowed employees to call other desks in a company without routing the call through the telecom provider’s network. The PBX also made people more productive by allowing them to communicate and collaborate more freely.

Nowadays, how often do you pick up your deskphone and call someone else in your office? Wouldn’t you rather send them an email or an IM or open up a video chat with them?

Heck, I don’t even give out my office number anymore. I hand my Google Voice number and set it to ring wherever I am (office, home, iPhone). The only “value” I get from my PBX is voicemail. And I’d prefer to receive voicemails in my email inbox rather than dial into the PBX.

Ferro points out that the future of the PBX is as a presence server. Rather than routing phone calls, the presence server will tell users whether people are available for a conversation and how you can reach them (email, IM, phone, etc). The server will also hold all your message, regardless of the medium.

Most vendors clearly see that this is on the horizon. See Cisco’s acquisition of Jabber, Microsoft’s Office Communications Server strategy and IBM’s Sametime strategy.

In my view, it’s not a question of if the PBX will go away, but when. Any shift away from the PBX paradigm will lead to a broader and deeper dependence on mobile phones. And mobile phones are still relatively expensive in the United States. I spend four or five hours a day on the phone. If I did all that on my iPhone, I’d blow up my minutes.

So this would require not just a big technological shift, but also a philosophical shift for business leaders. Most enterprises still adhere to the strategic deployment of mobile devices. They hand BlackBerrys to sales teams and top executives and leave the rest of the company tied to their desks.

A world without PBXes would require a big shift in thinking, and this will take time. Have you ever tried to convince the CFO that you need to give the mail room manager an iPhone?

January 4, 2010  9:18 PM

Mitel preps IPO: What does it mean to you?



Posted by: Shamus McGillicuddy
Cisco, Fixed-mobile convergence, IPO, mergers & acquisitions, Mitel, Nortel, Siemens Enterprise Networks, Unified Communications

Unless you’re a Mitel customer or a Canadian, you’re probably not all that interested in Mitel’s plans for a $230-million initial public offering. However, if the IPO goes well, Ottawa-based Mitel could have some capital to make some moves in 2010 and beyond. Mitel will use capital from the IPO to settle some debts, but the company said it will also look to make some acquisitions with the money.

Avaya’s acquisition of Nortel’s enterprise division means that a lot of enterprises are re-evaluating their voice and UC infrastructure these days. Cisco and Avaya remain at the top of the heap, but smaller players like Siemens and Mitel will undoubtedly try to take advantage of the inevitable churn that will follow Nortel’s exit from the market. For the first time in many years, Nortel customers are shopping for a new vendor. Nortel customers will be wined-and-dined at VoiceCon Orlando in a couple months, that’s for sure.

With that in mind, it’s worth looking at some highlights of what Mitel has been up to in the world of UC in recent years.

  1. Last June Mitel announced a strategic collaboration with VMware to make its UC products “VMware-ready.” To date, not many companies feel comfortable with virtualizing their voice and communications infrastructure, but the desire is there. Avaya and Alcatel-Lucent are also making strong progress here.
  2. Mitel has been collaborating with Sun Microsystems for a couple of years on integrating its UC applications with Sun’s Sun Ray thin client technology. By OEMing Sun Ray, Mitel offers companies the ability to mobilize employees within a corporate campus. Users can use a smart card to plug into any thin client on a campus and get full UC functionality wherever they go.
  3. Last spring Mitel advanced its fixed-mobile convergence capabilities with a new “hot-desking” feature in its Series X UC application portfolio, giving it a offering comparable to leaders like Avaya and Cisco.
  4. In 2007, Mitel bought Inter-Tel, a Delaware-based provider of managed network and communications services. This $700-million deal boosted Mitel’s market presence in North America significantly.


December 4, 2009  8:09 PM

Picking up the pieces after Cisco finally gets its hands on Tandberg



Posted by: Shamus McGillicuddy
Cisco, enterprise video, mergers & acquisitions, Tandberg, videoconferencing

Cisco finally managed to win over enough of Tandberg’s shareholders to complete its takeover of the enterprise video company. Cisco had stipulated that it would only move ahead with the acquisition if it could gain 90% of Tandberg’s stock, apparently because Norwegian law requires all shareholders to sell once 90% of the shares have been voluntarily sold to a buyer.

  • Why was this deal so hard for Cisco to close? Answer: It’s complicated. Reuters’ DealTalk has a nice rundown on the confluence of complicated factors that nearly scuttled this deal. For one thing, there were cultural issues. Apparently Scandinavian investors (Tandberg is a Norwegian company) are not bashful about kicking up a fuss when they feel aggrieved. And Cisco might have overplayed its hand by talking up the so-called synergies and business opportunities that a combined Cisco-Tandberg would enjoy. This talk may have prompted the holdout shareholders to demand more money. On the other hand, Peter Germonpre of Panta Capital told Reuters that Cisco may have been clever and low-balled Tandberg early on in an effort to keep the final price low.  Also, many Tandberg shareholders were reluctant to give up their shares because they like the diversity in their stock portfolio that a successful local tech company represents. Folketrygdfondet, a Norwegian company that manages the the investments of the government’s employee pension funds, was a major holdout. Pension fund investors love diversity.
  • The U.S. Justice Department is now looking at the Cisco-Tandberg transaction from an antitrust perspective. I’m not sure that this investigation will go anywhere. Cisco’s videoconferencing business was limited to the very high end with its Telepresence products. Yes, it has bought a telepresence competitor, but Tandberg is not a telepresence company. It is an enterprise video company. There were two major players in enterprise video before this deal (Tandberg and Polycom) and there are two major players in the market after this deal (Cisco and Polycom).
  • A tax shelter for Cisco? As the New York Times Dealbook blog notes, Cisco has piles of cash sitting overseas with its international subsidiaries. Dealbook says that by buying Tandberg, Cisco gets to avoid paying taxes on the $3.4 billion it spent in the deal. I’m not a tax lawyer, so I don’t know how it works. But avoiding paying taxes on $3.4 billion seems like a good deal for Cisco, not so much for the U.S. Treasury.


December 3, 2009  10:46 PM

Runaway bride: Cisco waiting at the altar for Tandberg



Posted by: Shamus McGillicuddy
Cisco, enterprise video, mergers & acquisitions, Tandberg, videoconferencing

Dear Tandberg shareholders: Will you or won’t you make Cisco the happiest and most powerful videoconferencing vendor in the world?

This acquisition of Tandberg sure has drama, doesn’t it? Here it is, early evening on Dec. 3 and there’s still no word as to whether Cisco has acquired the requisite number of shares it set for itself to close the deal. Cisco’s agreement to buy Tandberg includes the provision that the deal can only happen if Cisco can get hold of 90% of Tandberg’s stock. As of yesterday, Cisco had only managed to collect commitments from shareholders to take over 84% of the stock. If Cisco can’t get to 90%, the deal won’t happen and Cisco will walk away. Cisco has extended the deadline for reaching the 90% threshold a coulpe of times, but it said yesterday that tdoay was the final extension. The clock was to run out at 5:30 PM CET (Central European Time), which passed us by hours ago.

Yet we have no news. Cisco and Tandberg have been silent on whether they were able to get this done. We haven’t heard much at all since Cisco upped its offer from $3 billion to $3.41 billion to entice some holdout shareholders who felt the original offer undervalued Tandberg.

Here we are, with not a peep from Cisco and Tandberg. Are executives working the phones, trying to figure out whether this deal? Or have they decided to let the silence speak for itself and the deal is dead. We shall see.


November 25, 2009  8:25 PM

A war of words? Unified communications vs. collaboration



Posted by: Jessica Scarpati
collaboration tools, Unified Communications

Is the term “unified communications” already dated? Don Van Doren over at Unified Communications Strategies notes Cisco seems to be pushing lately for “collaboration,” and while it’s fortunately less of a mouthful, the UC terminology war is only confusing enterprises.

Pulling no punches, he lays into vendors for soiling UC’s good name:

First, UC has come to be associated with the voice and voice-substitute (e.g., IM) components of communications. This emphasis has been especially prevalent from the legacy telephony equipment suppliers, many of whom tend to see things through a voice filter. In my opinion, voice will increasingly be augmented by other forms of unified communications, which can offer deliver better information more rapidly or accurately.

Meanwhile, he adds, confusing customers does no one any favors:

The risk is that when there is confusion, people tend either to sit on their wallets, or to reflexively purchase tried-and-true, like-for-like functionality. The impact is that too many enterprises will delay the realization of the compelling benefits that UC can enable by failing to grasp the impact of the industry changes that are underway.


November 16, 2009  7:23 PM

Cisco gives in to demands of holdout Tandberg shareholders



Posted by: Shamus McGillicuddy
Cisco, enterprise video, mergers & acquisitions, Tandberg, videoconferencing

Cisco’s newly revised $3.41 billion offer for Tandberg represents a total capitulation to the demands of several holdout Tandberg shareholders who were asking for more money.

Cisco originally offered $3 billion for the Norwegian videoconferencing vendor, but the deal was contingent on 90% of Tandberg shareholders accepting the price. The deal appeared in trouble when a cadre of shareholders who owned about 24% of the company’s stock demanded an 11% increase over Cisco’s original offer.

Today Cisco has come through with that. Its $410 million bid increase is about $80 million more than the holdout shareholders were asking for. This deal looks like it’s going to happen.


November 16, 2009  5:15 PM

Videoconferencing consolidation continues: Logitech buys LifeSize



Posted by: Shamus McGillicuddy
Cisco, LifeSize, Tandberg, telepresence, videoconferencing

Lost in the hoopla from last week’s news that HP bought 3Com was a much smaller deal in the high definition (HD) videoconferencing market. PC accessory company Logitech has bought LifeSize Communicaitons, a six-year-old vendor of HD desktop videoconferencing and room-based telepresence products for $405 million.

Logitech is best known as a manufacturer of peripheral devices for PCs, especially keyboards and mice. With only a line of standard-definition webcams, Logitech’s specialty is not enterprise video.

With LifeSize, Logitech graduates from selling peripheral devices to consumers and small businesses to selling an enterprise solution. It’s a whole different ballgame. In addition to endpoint devices, LifeSize sells HD videoconferencing infrastructure, such as multipoint control units (MCUs), gateways and security devices.

In the wake of Cisco’s attempt to acquire Tandberg (a deal which might be collapsing), LifeSize probably recognized that competing in the enterprise video market will require the backing of a larger corporate partner.  Logitech might have the money to boost LifeSize’s marketing budget, but it doesn’t bring the right sales channel to the table.

The most logical next step for Logitech will be to approach key unified communications competitors to Cisco like Avaya, Siemens and Microsoft to build up video interoperability partnerships.


November 5, 2009  7:47 PM

Google Social Search getting closer?



Posted by: Leigha

While not true for many technology segments, bloggers in the unified communications space often post pragmatic, insightful and useful information. However, finding specific information when you need it in the blogosphere is a challenge, but one that Google is trying to address.

Google Social Search is a new experimental feature designed to help users customize searches, including blogs, reviews and other content publicly available within your social circle.

Continued »


November 2, 2009  8:59 AM

Fixed-mobile convergence vendor DiVitas supports iPhone, Android and Blackberry



Posted by: Shamus McGillicuddy
Agito, Android, BlackBerry, Divitas, Fixed-mobile convergence, iphone, Nokia, smartphones

In the realm of dual-mode fixed-mobile convergence (FMC), one of the biggest barriers to broad adoption is the narrow scope of smartphone platforms supported. Agito and DiVitas, the two top independent dual-mode FMC vendors have struggled to come together with some of the platform makers… A big stumbling block for adoption has long been the lack of dual-mode FMC support for Research In Motion’s BlackBerry platform, still THE enterprise smartphone platform of choice.

In June we reported that Agito finally managed to add BlackBerry suppoprt, expanding beyond the 40 or so Nokia Symbian and Windows Mobile devices it had already been supporting.

DiVitas, on the other hand had been quiet for awhile on the BlackBerry front, limited to Windows Mobile and Nokia E series and N series phones.

Today DiVitas announced a huge expansion of the mobile platforms it supports. It has developed a native client and a web-based client that extends its FMC technology to the iPhone, BlackBerry and Android operating systems.

Check out this PDF data sheet on the new Divitas offerings. You’ll see snapshots of what DiVitas’ FMC client looks like on each mobile platform.


October 30, 2009  7:28 PM

Is Cisco backing out of Tandberg deal?



Posted by: Shamus McGillicuddy
Cisco, enterprise video, Polycom, Tandberg, videoconferencing

Bloomberg is reporting that Cisco might walk away from its agreement to buy Tandberg. As we mentioned two weeks ago, A large group of shareholders have balked at the $3 billion offer Cisco and Tandberg’s executives and boards of directors agreed upon. Cisco’s Tandberg deal is contingent on it being able to acquire 90% of the company’s stock. Twenty-one shareholders who own 24% of the company say Cisco’s offer is too low.

Bloomberg is citing a “person familiar with the transaction” as the anonymous source for its report.  Financial analyst Martin Hoff at Arctic Securities ASA told Bloomberg that Cisco probably won’t just walk away. Instead, the anonymous claim that Cisco is contemplating a pullout from the deal is probably just a scare tactic. “It’s probably smart of them to send some signals to scare the shareholders into accepting the offer,” he told Bloomberg.

If Cisco does close the Tandberg deal, it will expand its enterprise video strategy from its high-end telepresence products to a full suite of desktop and room-based video systems, multipoint control units and video management software. Combined with Cisco’s existing lines of telephony products and Cisco will be competing directly with Tandberg’s chief rival Polycom on all fronts. If that happens, enterprises can expect other major communications vendors like Avaya and Microsoft to become heavily aligned with Polycom.


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