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Siemens (Finally) Launches a Cloud UC Service

 Siemens Enterprise Communications has launched a new cloud communications solution. Leveraging SIP, open standards and its highly scalable softswitch-based OpenScape suite, it is looking to provide partners and customers with more flexible deployment options. The cloud solution includes virtualized, multi-tenant versions of Siemens’ OpenScape Voice, OpenScape UC and OpenScape Web Collaboration software, hosted in four geo-redundant data centers. The service features top-notch availability, survivability, governance and data privacy features, including:

  • Highest availability, TIA-942 class data center, voice redundancy, secure endpoints
  • Edge survivability option, local trunking, IPSec VPN, local firewalls, SBC and media server
  • Multi-tier role-based access management, automated management and provisioning, application-level data center protection
  • End-to-end encryption in the cloud, local country data storage, multitenant capability, data protection audits

Cloud-based voice and UC services will be available only through partners, who will handle customer needs assessment, CPE installation, billing, 1st and 2nd level tech support and ongoing equipment maintenance. The service will be first launched in the U.S., Germany and the Netherlands. Initial partners include Black Box in the U.S., mr.net and Telefonbau Schneider in Germany, and Televersal, ICT Trends Group and onecentral in the Netherlands.

The cloud solution is considered optimal for organizations with about 350 to 1,000 users, with a need for highly packaged, tightly integrated solutions. Users can choose from a variety of features and capabilities grouped in Base Packs and Booster Packs. The estimated end-user list pricing ranges between $5 and $30 per seat per month, based on required functionality.

What I like about this announcement:

Siemens has finally launched a cloud solution – something it started exploring about two years ago by demonstrating a proof of concept with Amazon’s EC infrastructure. With the incredible (I think, almost unreasonable) amount of hype surrounding cloud technologies and the cloud business model, it was about time for Siemens to finally bring this effort to fruition. I have to agree that there is a group of customers out there that would indeed appreciate the opportunity to outsource its communications infrastructure to avoid CAPEX, focus on core competencies or gain access to superior technologies and expertise. This customer segment would remain out of reach for Siemens, unless it finds an appropriate role for itself in the hosted/cloud-based communications marketplace.

It should be noted that Siemens has had a multi-tenant voice platform for years and some service providers such as Postrack and Engage have been using it to deliver services to end users just like others use BroadSoft’s or Metaswitch’s platforms. Other vendors such as Alcatel-Lucent, Cisco and Mitel have also deployed multi-tenant communication managers with service provider partners.

The new approach has significant advantages, however. It gives Siemens continued control over the platform and its capabilities. But more importantly, it empowers partners that cannot or do not wish to manage their own data centers to deliver services using Siemens’ feature-rich and highly scalable platform. Siemens allows partners to use its brand, co-market or white label their cloud services. This is an opportunity for them to gain differentiation as well as new recurring revenue streams. This model provides a fast and economical entry point for small MSPs and VARs to become hosted service providers. It is noteworthy that Siemens announces the new solution along with six partners already lined up.

Issues that Siemens will need to address:

Siemens is not alone in this market. Other telephony vendors are experimenting with new delivery models as well. For example, Mitel offers the Mitel Anywhere service, which it sells directly to business customers. Now it is exploring opportunities with data center providers such as Host.net and Hosting.com, which can host the platform on behalf of small MSPs and VARs. Siemens and other vendors will need to find ways to differentiate or be fast to market with the right partnerships while the market is still nascent and untapped.

 More importantly, this new delivery model is still unproven and it is not clear how all market participants in the value chain will reposition themselves for competition in the evolving marketplace. Will the MSPs and VARs be successful in penetrating the CPE customer base? Will the vendors be able to successfully manage their channels to ensure customer satisfaction and optimal benefits from the cloud services? How will carriers be involved to ensure proper bandwidth and QoS management – critical elements for real-time communications services delivered over the WAN? Who will manage the carrier relationship? How will the hosted IP PBX and UC solutions be aligned with SIP trunking and IP VPN services to provide superior benefits to multi-site organizations?

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XO Taps into Cloud Communications

Today, XO Communications launched the XO Enterprise Cloud Communications services. XO Enterprise Cloud Communications integrates a wide range of IP telephony features, local and long distance calling, enterprise-wide HD voice and video, network services, and IP phone sets in a communications as a service, per-user pricing model. Features of XO Enterprise Cloud Communications include:

  • IP Telephony and unified communications applications
  • Free local and site-to-site calling within the enterprise
  • Long distance calling plans
  • Enterprise-wide HD voice and HD video
  • Choices of IP phone sets from Cisco and Polycom
  • Web portal for managing service for each location and employees
  • Quality of Service monitoring
  • MPLS IP-VPN network services
  • Robust Service Level Agreements for all services
  • Business continuity capabilities

XO is looking to target businesses of 50 to 1,000 seats per enterprise, primarily in the education, healthcare, professional services and retail verticals.

What I like about the new offering:

XO has been tremendously successful with its XO IP Flex (also available with a VPN feature), XO SIP and XO Enterprise SIP offerings. The new offering nicely rounds up its SIP/cloud portfolio adding hosted PBX functionality for businesses choosing to outsource their voice communications infrastructure. Leveraging its SIP expertise, intimate knowledge of the BroadSoft platform and MPLS capabilities, XO will be able to deliver a highly reliable cloud-based voice service with managed bandwidth and QoS and carrier-grade SLAs. The option to include phone set costs in monthly recurring charges is likely to appeal to businesses concerned about the upfront costs of replacing existing phone instruments. XO has broad geographic reach and therefore the ability to address the needs of larger, multi-site customers migrating to hosted services. A web portal will allow customers to monitor and manage their cloud services.

XO appears to be a late-comer to the hosted telephony space. Several dozens of service providers have launched hosted IP telephony in the U.S. over the past eight years. However, its cautious approach may prove more successful as it has had the time to master SIP and develop the right capabilities for its target audience. Also, larger businesses are only now beginning to fully understand and appreciate the benefits of hosted/cloud communications which creates more favorable conditions for the delayed launch. Furthermore, XO is looking to position this new offering with a TCO improvement value, rather than the more traditional value proposition of inexpensive long distance or in-house staff replacement of early hosted offerings targeted at smaller businesses of less than 50 users.

Points to be addressed by XO:

Service providers that have been offering hosted voice for some years now are already looking to enhance their solutions with other communications and collaboration application such as conferencing, contact center, messaging, presence and collaboration. XO has contact center capabilities, as well as OCS, Exchange and SharePoint integrations on its roadmap, but immediate comparisons may tip the scales in favor of a competitor. I need to point out that not everyone (in fact, maybe few) larger businesses are looking to immediately outsource their entire communications infrastructure from voice to messaging from a third party. However, the sooner XO announces the ability to deliver a more complete UC package, the greater its competitive advantage is going to be. Also, service providers are increasingly looking to integrate communications with business applications (CRM being the typical low-hanging fruit) based on customer demand, which is something XO will need to explore in the future.

XO claims it has the tools and partnerships in place to manage this service all the way to the desktop. In fact, it offers on-premises probe, usage, network and support services. Hopefully, it handles this aspect properly, because many a service provider have failed associating cloud and hosted with a complete hands-off approach as far as the customer premises are concerned. But a reliable hosted communications service, especially when larger businesses are involved, requires a significant involvement in customer LAN, WAN and CPE upfront assessment and ongoing management.

WebRTC

Global Clossing Launches CaaS Suite

Global Crossing announced Global Crossing® Communications as a Service (CaaS), which it refers to as “the first phase of its network-centric, cloud-based solution set.”  It is positioned as combining Global Crossing IP Virtual Private Network (IP VPN), Session Initiated Protocol (SIP) Trunking, and Global Crossing Ready Access® hosted audio conferencing services to provide “a tailor-made collaboration experience”.  These combined capabilities also support the functionality of Global Crossing Connect Mobile, which enables users to join or host an audio conference from popular mobile devices by clicking on an icon and also syncs meetings with users’ calendars.

What I like about the new offering:

Global Crossing has a long and successful track record in network management and delivering network-based services to both service provider partners (using a wholesale business model) and directly to enterprise customers. Its expertise in IP VPN and SIP trunking technologies offers a solid foundation for the delivery of cloud-based communications applications. Also, the new shared-seat billing model (with monthly fees replacing per-minute plans) is likely to appeal to customers as it makes communications costs more predictable and easier to manage. Finally, the offering is integrated with the uCommand customer portal, which empowers in-house IT staff to closely monitor and manage the organization’s use of cloud services.

What begs further investigation:

It is not clear from the press release exactly how Global Crossing’s IP VPN, SIP Trunking and hosted audio conferencing services are coming together. Since these services have been around for a while, it is not clear what has changed, except for the new billing model. I am intrigued by the pending addition of telephony, video, messaging and presence services to the CaaS suite, which will mark Global Crossing’s foray into the world of cloud-based Unified Communications (UC).  What makes this potential move especially interesting is the fact that Global Crossing’s customer base consists of mostly large enterprises. Since, so far, most hosted telephony and UC services have been targeted at SMBs, Global Crossing has an opportunity to differentiate and offer unique value in an untapped (from a CaaS point of view) market segment.

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Cloud, Cloudy, Cloudier …

Today we woke up to multiple “cloud” announcements at Enterprise Connect, including those by Global Crossing, Siemens Enterprise Communications, Verizon and XO Communications. I am sure I missed some. This proves that cloud is top of mind for many industry participants and we are bound to see a proliferation of cloud offerings throughout the year and going forward.

 I understand there was also a cloud panel discussion that took place this morning. Since I am not attending the event, all I can tell (judging by various tweets) is that the definition of cloud is only getting cloudier. While customer awareness of the benefits of cloud services is increasing and is likely to drive demand, it is too early for vendors and service providers to sit and watch their R&D efforts bear fruit. Education and continued focus on understanding customer needs and developing viable go-to-market strategies will be needed for cloud services to live up to their hype.

 I intend to follow up with some brief comments on the key announcements mentioned above.

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