Nortel: It's Enterprise VOIP!
With the service provider market all but dried up, Nortel Networks Corp. (NYSE/Toronto: NT) made a serious push back into the enterprise space today, announcing a new enterprise strategy and enhanced IP telephony equipment that might just give rival Cisco Systems Inc. (Nasdaq: CSCO) a run for its money (see Nortel Rolls Out New Strategy).
Nortel announced a second version of its Succession Communication Server for Enterprise (CSE) 1000 IP; a new version of its CallPilot unified messaging system; and the BayStack 460-24T-PRW Power over Ethernet switch.
Nortel has hiked the IP phone support on its CSE 1000 2.0 from 650 users per server to 1,000. On a cluster of 10 servers, it can support up to 10,000 IP phones. The CSE 1000 2.0, which allows the convergence of voice and data, will be available by the end of this week.
The new version of Nortel’s CallPilot unified messaging server software will also be available by the end of the week; it offers more than 40 new features, including improved system management, better security, and full Web access. The new CallPilot, which raises the number of users from 1,500 to 7,000, integrates email and voicemail messages into a single inbox.
Nortel says its BayStack 460-24T-PWR Power over Ethernet switch, to be released in January, will help eliminate latency in voice-over-IP traffic; it is IEEE P802.3af compliant (see Nortel Unveils Switches).
This barrage of VOIP announcements accompanies a larger marketing strategy. The company's new enterprise focus, with the catch-phrase, "One Network. A world of choice," aims to demonstrate that Nortel is serious about gaining market share in the enterprise VOIP market.
Some analysts point out that Nortel let its influence in the enterprise market wane as it aggressively moved into the service provider space. When the carriers started pulling their purse-strings tight, Nortel started feeling the sting. After piling up huge losses and having to lay off more than half of its employees, Nortel, like most of its competitors, has restructured and refocused its business back to the enterprise space.
"This is an important announcement for Nortel,” says Zeus Karravala, the VP of enterprise infrastructure at Yankee Group. "They’re saying: ‘We’re an enterprise player and we’re here to stay.’ I think they’re on the right track."
Earlier this month, Nortel was reorganized into four groups: wireless networks, wire-line networks, optical networks, and enterprise networks (see Nortel Reorganizes). Today, Oscar Rodriguez, the president and general manager of the new Enterprise Networks group, spoke on a company Webinar about Nortel’s reinvigorated enterprise strategy. "We’re committed to the enterprise space,” he said. "Our vision is really all about allowing you to engage with your customers… It allows you to deliver what your customers want when they want it."
Credibility is key if the company wants to sign up long-term enterprise customers for its VOIP products now. “They couldn’t have made this announcement two to three months ago [because] their stock was so weak,” says Frost & Sullivan VOIP analyst Jon Arnold. “This is an example of them getting back on their feet and proving that they still have what it takes.”
However, he says, if Nortel wants to establish itself in this space -- which means winning with the "big guys" -- it’s going to need to keep the heat on, with constant announcements of products and partnerships.
Nortel’s new products and enterprise strategy are aimed at companies that are interested in moving to IP telephony but not yet prepared to give up the comfortable reliability of a traditional PBX system.
“We believe that it’s all about evolution -- not about revolution,” Rodriguez said. “We’re unifying the past and the present to allow you to drive into the future.”
Enabling a slow migration from PBX to IP is the only way VOIP products will make it, according to many observers. “These guys know that within five years there will be a major migration [to VOIP],” says Arnold. “Until then, they have to offer different flavors… They need to engage customers now because they need to keep them.”
— Eugénie Larson, Reporter, Light Reading