UK-based Timico and Nortel have teamed up to provide hosted VoIP services for the UK business market. Read the press release, and check out the section of the key features their solution provides. The features are nothing new to VoIP industry experts, but I think their simple statement is an attempt to educate their potential customers. IP-based communication is still a black box for many small and medium businesses, especially for those operating in non-tech industries. I have a friend who owns a food-processing company with about 70 employees, and his company is not even close to having a decent e-mail service that works. The result is that both his customers and suppliers usually call to ask if their e-mails have been received (and I am dead serious here..). Try talking to my friend about the productivity potential of VoIP.
In previous posts I pointed out how not only consumer-oriented service providers like Vonage but also more focused providers such as Cbeyond go after the SoHo and SME segment for VoIP solutions. One trend is that the equipment manufacturers themselves as the likes of Cisco go after this market by integrating vertically along the value chain, which is sometimes referred to as "moving up the stack", as they provide managed networks services directly to the final customer, instead of or in addition to enabling a telco to do so. They can do this as a result of IP, where network and premises boundaries are less relevant because IP may extend to the desktop.
Addressing this market can either be done by building up the required capabilities, or by teaming up with other players. The organizational change that would be required for big players like Cisco, Nortel, Siemens, etc. however is huge, as they would need to build the respective sales force - working with numerous SMEs is different than working with a manageable client portofolio of few enterprise customers. Mobile operators have experienced that pain when they started selling data solutions some time ago, especially for vertical solutions: You need both the expertise of your client's business and the manpower to follow and take care of them and their needs.
So probably the smart thing to do is to team up in some way with a more focused player who can take care of niche markets and sell your equipment and solutions, while allowing the partner to take a margin out of the services. Nortel is doing that with Timico, Cisco actually invested in Cbeyond. I am not sure what Siemens and Alcatel are doing. Siemens offers HiPath 8000 for up to 100.000 end stations - not really an SME-product, and the fact that Siemens itself is still operating with legacy PBXs probably won't impress any customer.
One of the key barriers for successfully penetrating the business market - one could compare it to E911 services for the residential segment - is in my view the problem of what happens once power goes down - namely nothing. I am trying to imagine my above-mentioned friend - while his computer and hence e-mail won't work when electricity is cut off, at least he can still pick up the phone and call a customer, right? Try explaining him what happens when he has a converged IP-based network. So I believe one key factor next to reliability and simplicity that could accelerate the deployment of VoIP in the business segment is Power over Ethernet, which would make the case for companies such as PowerDsine. (read more on Power over the Ethernet, especially this article on VoIP/PoE from PowerDsines Marketing VP)
Comments