UCStrategies Experts Debate Avaya Skype Strategic Agreement

5 Oct 2010

In this Industry Buzz podcast, the UCStrategies UC experts discuss the recent strategic agreement announced by Avaya and Skype "to deliver innovative, real-time communications and collaboration solutions to businesses of all sizes."

The UC expert panel includes Blair Pleasant, Dave Michels, Don Van Doren, Samantha Kane, Marty Parker, Art Rosenberg, and Steve Leaden.

UCStrategies encourages your comments on this podcast. Please see the "Comments" section at the bottom of this page to contribute.

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For more information on UCStrategies.com about Avaya's announcement:

Blair Pleasant: Hi, this is Blair Pleasant of UCStrategies. Jim Burton is at IT Expo this week, so I'll be helping out to lead this week's podcast. With me today are several of the UCStrategies experts, and we're going to talk about the latest news regarding Skype. Last week there was an announcement about Skype and Avaya working together, which we'll discuss. And also, Skype is in discussions with Facebook to let Facebook users make calls to their friends and family using Skype. As an advocate of both Unified Communications and social media, I've been saying for a long time that Facebook, Twitter, and some of the other public social media or social networking sites need to really have UC capabilities embedded to let users go from a chat session or an exchange with friends to a live, real-time phone call. And with the Facebook-Skype integration, it looks like this will soon be a possibility. So I'm real happy to hear about this.

We don't know what the service is going to look like yet. I'm basically assuming that Facebook users will be able to do click to call or click to video call from Facebook, and be able to access Skype services making Unified Communications easier for Facebook users. As far as Skype's announcement with Avaya, that's going to have a lot of implications for the enterprise and for the contact center.

Also it looks like Skype is going to have a new CEO. Tony Bates, who is at Cisco now, is moving over to Skype. So that's going to have some implications for Skype's activities in the enterprise, as well as on its IPO. So let's hear what the rest of the team thinks about Skype and its impact, and the implications on the UC and also on the contact center market. So Dave Michels, why don't you start us off?

Dave Michels: I thought the Facebook news was actually really interesting. But I think I'm going to instead talk about the Avaya news, which was reported as very interesting, but I don't think it's interesting at all. I think that the Avaya news is actually a little bit misleading, and is probably more of a strategy or a play to increase the value of Skype while they're in play here, either with their IPO or with a potential acquisition. But they basically announced a two-phase agreement.

Phase one, which is immediate, is that Avaya and Skype will jointly market the Skype SIP Connect service, which used to be called Skype for Business. That's nothing new. That's all old news. And the Skype Connect Service is a great service, but it's just a SIP trunking service; it has nothing to do with the core value of Skype. And it's really no change whatsoever technically, or from a sacrifice point of view that Avaya is making or that Skype is making. It's already been announced. It's been done. And Skype Connect also works with many other brands, including Cisco and Siemens. So I didn't really see any relevance to that story.

Phase two is what's much more interesting. And that's where they really tap into the UC capabilities of the Skype client, the presence, and the IM, and the video capabilities, and integrating that into the Avaya UC client. But that's been promised for a year from now, or probably more-it's the second half of 2011, so probably more than a year from now. And that to me, is A) very significant and very meaningful, but B) very unlikely to actually happen. I mean a year is a long time in this industry right now. And to point that out, just 15 months ago Skype was still owned by eBay; they announced an IPO; they didn't do an IPO; they spun it off to Silver Lake. Silver Lake has since announced an IPO, and now they might be acquired by another company. And so I think that a year from now, it's hard to gauge any kind of significance and meaningful information out of anything like that. And also I think a year from now means that they haven't even started the development yet. So those are my thoughts on the Skype-Avaya thing. Thank you.

Don Van Doren: I think, Dave, you're maybe a little cynical, but I understand a lot of what your points are. Having said that, I think there are a couple things here that are important. On the first hand, I think that what we're seeing, of course, is a lot of new services that are being offered in the whole Unified Communications space. In many cases, innovators like Skype and Google are leading the way in these, and yet there is still going to be benefit of course for enterprises to be able to have a way to seamlessly administer and control, and provide for seamless access to these kinds of applications. And I think that yes, it's going to take a long time for this to happen. But I think from an overall standpoint, what we're seeing is this is just one more example of the way we are shifting communications to have it work in a very different fashion going forward. And these kinds of partnerships, perhaps for the cynical reasons that Dave mentioned, but also for other reasons too; I think that we can see the fact that there's going to be some opportunities going forward. That's sort of one issue.

The second thing is sort of along the same lines. And in one of the comments that Alan (Baratz) made in announcing this was that there's going to be improved, I'll quote here -- "Striving to improve collaboration and customer service by federating solutions together." And I think again, this concept of federation is something that is going to be increasingly important going forward. It's something that I think we're going to see a lot of more happening. And again, this is just one more stone in the foundation to help make a lot of this happen.

Samantha Kane: It's Samantha here, Don. Good points. What I want to point out is that in their announcement last week, they break it into phases. And in the first phase of the agreement, first of all if you want to have Avaya and Skype connect-which I believe is their trade for that product, which adds Skype calling to IP-based enterprise systems. You have to start now getting into SIP - the Session Initiation Protocol communication channels between Avaya Systems and Skype. And not everybody has SIP. So that's item number one.

Number two, customers have to have Avaya Aura Session Manager, or Avaya Aura SIP Enablement Server, or the CS1000, or the Avaya IP Office to use the Skype Connect to place calls globally. But it's really only going to start in the US. And as Dave said earlier, it's going to be in the second half of 2011 that Avaya and Skype plan to deliver the integrated Unified Communications. So as an enterprise user, you've got to have a whole bunch of things in place and your house in order before you're able to activate this kind of service.

Marty Parker: Right, Samantha. This is Marty Parker speaking. I think that it's indicative of one approach to Unified Communications, which is to make it an incentive or motivator for customers to migrate to move up to the latest releases of products. SIP Enablement Server has been part of the Avaya configuration for four or five years. So probably a significant chunk of their IP Telephony base has access to that product. But the emphasis is on Avaya Session Manager, so it's clearly part of a migration strategy.

A thought that's come up from my perspective is that this is really changing the nature of what carriers are defined to be. And more than the Avaya element of this conversation is the question of whether Avaya and others are starting to believe that you're not going to have a telephone as an endpoint in the future. You're going to have a Skype client as an endpoint, or a Facebook account as an endpoint. And maybe not even a cell phone. I mean, are they thinking that this is the new endpoint and it is going to be an IP soft phone client? And maybe it gets marketed by a consumer brand rather than a traditional telephone company type of carrier. So it may be the beginning of a significant market trend in terms of how people expect to connect to the enterprise, at least the first couple younger generations of the community out there.

Samantha Kane: But Marty, do you think that the Skype announcement and creating those new kind of touch points or endpoints is enough incentive for a Telecom manager to say to his boss, "I now have the justification of why I want to go to VoIP and why I want to go to SIP?" And I guess the other thing is, do the people that are selling it have enough of a holistic approach to be able to explain to a customer what kind of business solutions and drivers that will provide to them?

So you're absolutely right. There's a whole migration plan that has to be put in place, and a whole requirement of knowledge transfer that has to go on-both at the Avaya end-and at the customer end. And so that's where I see folks like ourselves and UCStrategies really helping people understand as another touch point what these things can do for a customer.

Art Rosenberg: I am inclined to agree with you on that perspective because quite frankly I always worked down at the end user level; the individual end user. And that individual end user is a business person, it's a customer, it's a consumer. You can't separate it out anymore. You've got to have all the connections for that person.

Marty Parker: Art, I agree with you that that's the case. I think that's the question: what kind of endpoints are those people going to be using? Back to your point, Samantha, I believe that this could be a motivation for a company whose vice president of marketing, and I say that on purpose, has decided that the firm needs to be reaching people who are using these new media forms. The release says 124 million average monthly connected participants? That VP will say, "That audience needs to be reached by our company. They need to get service from us through that medium, so let's do everything we can." I think that from a migration perspective, however, if I were consulting with a client like that, I'd probably say, "great-you only need to install this in one of your call center locations." And then "because you have a multi-location call center, you can route calls across your backbone to any other call center, so you really only need one point of presence to get started." So I don't think this is enough to migrate an enterprise. I think it's enough to migrate a call center.

Don Van Doren: Let me add something to that, too. I think this is one of the things that companies are going to be looking for. It's how do you use some of these kinds of new services just as you have suggested, to allow customers to gain access to enterprises in a new and different way? We're clearly seeing that there's great interest in facilitating these kinds of connections. And so again, I think announcements like this or capabilities like this are going to be important. Now frankly of course, some of the things that they're talking about now have been available.

And in the Skype click and call buttons for example, these kinds of capabilities have been available before. But the fact that these companies are speaking about it, and talking about it, and promoting it shows certainly from Avaya's standpoint, that they realize that they've got to open up their systems to new channels. And I think that's going to be an important step.

Steve Leaden: And between the lines, I'm reading this also as a way for Avaya to answer the call of Cisco's acquisition of Tandberg. And I'm also seeing it as a way for Skype to finally get into the financial black area of the business through the enterprise space. So I'm seeing some of that going on. I'm also seeing the fact that Skype in general is playing, obviously it wants to play in the commercial market. At the same time a lot of these services are through federation. And in most cases open internet, meaning no quality of service but best efforts. So we have to keep in mind that quality of service experience in the commercial space as we go forward.

So I really find the whole announcement interesting. In fact, I'll just read a piece from one of the gentlemen from Avaya, Mr. Baratz. And he states, "so when you go to establish a video conference from within the Avaya environment, the endpoint on the other side could be a Skype client. The fact that it's a Skype client is transparent to the user. It's fully integrated." So it's interesting to see that again, this integration and collaboration is entering into that enterprise space. And I think again, Avaya needs to answer quickly that the video space. They did it two to three weeks ago with Flare, and now here's another announcement in that same general space.

Blair Pleasant: Okay. Thank you, everybody. Great discussion. Also to our readers and listeners, we'd love to hear your comments and feedback about our podcasts, articles, and blogs. So let us know what you think, and also what you'd like to hear us discuss. So thanks very much, and see you next week.


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