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Friday, 16 November 2007

For once, an article that is 'right on the money'...

As a sometime journalist myself, I read a lot of articles on IP telephony and unified communications. Often they are less than informative, mainly because a lot of people just repeat what they have read in other articles. This isn't wrong as such, as not everyone reads all the online magazines and blogs, so there is a demand for 'multiple messaging media' - i.e. regurgitation.

But it makes a nice change to see a well written and truly informative article on one of my favourite subjects: IP telephony, hence my outrageous and blatant reproduction of this article which was just published on the IP Business site:


"Half of SMEs Want Managed IP Communications

A new survey of small and medium-sized business executives by The Yankee Group suggests there is increasing interest in managed IP telephony services.

Apparently buyers recognize that an IP phone system isn’t as easy to manage as a legacy phone system. About 47 percent of very small businesses, 53 percent of small businesses and 52 percent of medium businesses will outsource some or all of their IP telephony management, the survey suggests.

Also, 44 percent of very small businesses, 54 percent of small businesses and 56 percent of medium businesses are willing to consider a mix of on-premises and hosted solutions.

Fully 72 percent of very small businesses, 69 percent of small businesses, and 77 percent of medium businesses feel that they are only minimally or somewhat capable of supporting IP telephony within their organizations.

And though the survey confirms the continuing importance of price motivators for choosing hosted solutions over premises solutions, the survey also suggests that SMEs that outsource don’t do so for purely cost reasons.Lack of internal support staff and disaster recovery preparedness are issues that contribute meaningfully to the choice of a hosted solution.

In fact, the survey indicates that only 21 percent to 25 percent of SMEs feel fully capable of supporting IP telephony. As a result, most SMEs who buy IP phone systems appear open to management services, either fully or in part.

Security and end-user training appear high on the list of needs. About 42 percent of very small businesses, 43 percent of small businesses, and 41 percent of medium businesses responded that security skills were one of their most lacking skills in order to deploy IP telephony.

Significantly, telecommunications companies still are viewed as an important channel for IP telephony, particularly for very small businesses. About 64 percent of medium businesses and 58 percent of small businesses indicate that it is somewhat or very important to buy data and voice solutions from the same vendor.

That tends to explain why suppliers such as Cbeyond have had such success in the small business market, while providers such as M5 Networks have been getting traction in the medium business segment. More than half (51 percent) of very small businesses worked with or plan to work with their telecommunications provider for the deployment of their IP telephony systems, the survey shows.

The survey also suggests that voice-over-broadband applications and services such as Skype are getting traction as well. Web and audio conferencing are seen as highly valuable applications, followed by unified messaging and soft phones for very small businesses.

At least so far, advanced applications still have limited rollouts and are not available to the majority of users, says Gary Chen, Yankee Group senior analyst. Somewhat oddly, very small and small business users actually have better access than medium business users to IP telephony applications, the study suggests.

The survey also suggests buyers have bought the productivity message promised by unified messaging. Fully 70 percent of very small businesses, 80 percent of small businesses and 86 percent of medium businesses think that IP telephony will make it easier to deliver services to telecommuters and road warriors.

And 40 percent of very small businesses, 38 percent of small businesses and 35 percent of medium businesses believe that unified messaging will provide the biggest productivity improvement.

One aspect of user behavior seems not to have changed, though. Most end users are not taking advantage of all the features of their IP telephony system, as SME respondents say end-user training still hasn’t motivated people to exploit all the new features. About five percent of very small businesses, 46 percent of small businesses and 46 percent of medium businesses say end-user training issues are the biggest barrier to benefiting from IP telephony and unified communications.

The survey suggests that SMEs still are primarily driven to adopt IP telephony for cost savings. But the respondents also overwhelmingly view IP communications as a strategic move. Some 66 percent of very small businesses, 72 percent of small businesses and 76 percent of medium businesses say that IP telephony is or will be strategic to their business.

Nor have voice quality concerns lessened completely. About 49 percent of very small businesses, 48 percent of small businesses and 47 percent of medium businesses say voice quality is their top technical concern.

So far, it appears that hosted IP telephony providers have been unable to raise penetration levels beyond what Centrex had achieved in the market. Less than 10 percent of surveyed SMEs say they have definite plans to adopt IP Centrex at this time.

The survey also suggests potential SME buyers are not convinced hosted providers can provide better or cheaper service than would be possible using an IP phone system. About 39 percent of very small businesses, 44 percent of small businesses and 51 percent of medium businesses believe they can do a better job of managing IP telephony than a hosted provider.

Part of the reason may simply be that providers of hosted services are confusing the market with too many different messages.

Some 44 percent of very small businesses and 48 percent of small and medium businesses will only consider IP Centrex if it is cheaper than on-premises solutions. On the other hand, 34 percent of very small businesses and 48 percent of small and medium businesses believe that hosted IP communications services can offer better uptime and disaster recovery than an on-premises phone system."

The only changes I would have made, had I written the article, is to not use the phrase "the survey also suggests" quite so often... but maybe I am just being picky!.

Best regards,


Monday, 5 November 2007

Prescient, or what…?

There I was, analysing this and analysing that for a news article which appeared on the Comms Business web site last week and is reproduced in my previous blog (see below) when blow me down but my old employers make my words about vendors moving into managed services come true sooner rather than later!

I take my hat off to Cisco… they don’t half move fast when I suggest a course of action for them..8-)

For more information on what the San Jose networking company is up to, check out their blog on managed services: http://blogs.cisco.com/news/2007/10/ciscos_new_managed_services_ch.html

This blog has links to the relevant Cisco Online pages, but you need to be about to make a significant sum of money from MSP to give you the will to read all the blurb on these pages. And a degree in Cisco Speak to make sense of it. So I take my hat of to fellow blogger Brad Reese, who has encapsulated Cisco’s MSP play in a concise, easy to read article. Take a look at http://www.networkworld.com/community/node/21464 to see what I mean.

Cisco haven’t yet gone the whole hog and started their own managed services offering across the board (though of course they continue to offer the Webex managed service, ‘just to keep Webex’s old customers happy’) but in this MSP play they are supporting, with targeted partner marketing and discounted equipment pricing - though probably not in Brazil, just at this moment in time… a range of managed service offerings from service providers and channel partners.

Call me an old cynic if you will, but I would venture the following supposition: that Cisco will support others in testing the market for a variety of MS’s and then, when it becomes clear which particular MS packages the customers are going for in droves, will then pile in with their own home-grown offering. This will of course be sold via their large channel base, but the bulk of the profit will be made, as always, by Cisco. And why not!

Disclosure: I hold stock in Cisco. Unfortunately most of it was bought at a higher price than it has been for some while...8-(