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Early Morning Canada Shots

I am looking forward to my meetings today and the weather seems to be cooperating. Hope you enjoy these great views.

Blogged via wireless handheld

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What the HP/EDS Deal Means

When you look around the tech market you see factors which suck the profit out of every nook and cranny. In hardware there is a trend towards standards-based hardware which is not slowing down. As this trend continues, prices shrink and more competition exists in building computers, etc.

Moreover, as computers get more powerful they suck the life out proprietary solutions. It is very difficult to build a proprietary hardware system and not get undercut by a competitor who uses PC-based technology.

Software should be immune to this trend but open-source has made this segment of the market more challenging. Open source firewalls, routers, CRM software, etc. There is virtually no area of software where open source hasn't appeared.

But as software evolves and once separate systems such as telecom and datacom continue to become more interdependent, a strange thing is happening... The need to integrate disparate solutions has grown. In fact it is growing faster and faster and many companies in tech rely on integration to drive the majority of their profits.

Avaya, IBM, Aspect and others are adding more resources to their integration teams and in doing so they will make more and more money. Companies need the integration and there is no threat of open source or commoditized hardware to worry about.

If you are a computer company, you realize why you need to become an integration company. IBM realized it years ago and others are discovering the need to integrate as well.

Where will all of this lead? Into larger and larger integration/hardware/software companies making money from a variety of sources. The challenge of course will be how do integration firms stay independent when owned by hardware or software companies. In the overall scheme of things, this is likely not so important as when you are making tons of money on integration, you may not worry so much about purchasing a few servers from the competition.

See Also:

• Hewlett-Packard to buy EDS for $12.6 billion in bid to challenge IBM in tech services
• HP Issues Q2 Results, Guidance Above Street Expectations - Down 2% in Pre-Bell on EDS Acquisition

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Digium Picks Integrics to Power Carrier Solutions

Perhaps one of the biggest misperceptions among those who dabble in communications is that Asterisk is only used in small business environments. The reality is that Asterisk is being used in service provider environments as well.

Of course this doesn't mean that a product which happens to work great in a small to medium business is also able to simply flip a switch to become the heart of a service provider install.

In other words Asterisk + "a variety of additions" is what Mrs. or Mr. service provider needs to use this popular open source product to power services to their customers.

In an effort to simplify the process of adding Asterisk to the service provider environment, Digium -- the company behind the world's most popular open source communications software has partnered with Integrics, the maker of Enswitch.

According to an article on the subject by TMCnet's Susan Campbell, Enswitch allows service providers to use Asterisk in order to provide, full-featured, telephone management and billing solutions, calling card integration, toll free and number translation services, voice mail, call queuing, ACD, fax to e-mail, and multi-level IVR.

I am pretty impressed with the feature-set of Enswitch. For example, they provide XML and PDF invoices for customers, wizard-based activation, simple sales tax management, web-based administration, sophisticated authentication mechanisms, shared speed dials, .csv integration, dial by name, unlimited classes of service, etc.

In fact you may be hard pressed as a carrier to find a feature that Integrics hasn't thought of.

So what does such an announcement mean to the market? Well first off, service providers are likely to feel more comfortable working with products from Integrics as they now have the Digium brand, muscle and market power behind them.

In addition, we can expect the service provider market to embrace open source at an even more rapid pace than they are already doing.

Certainly I will report more as I hear it but my $.02 on the matter say this is a good move for all involved and for the broader telecom market.

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