Explosive Small Business Communications Growth

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Explosive Small Business Communications Growth

Please enjoy my April 2007 Internet Telephony Magazine Publisher's Outlook.
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You would have to be asleep to not realize how fast small business communications is growing. The reason? Small businesses didn’t have so many telecom choices a scant ten years ago. There was pretty much key systems and then some inexpensive PBXs came along thanks to AltiGen and other, similar players.
 
What is different now? VoIP. Vonage has done the marketing to educate small businesses about the power of IP communications and the small business owners are getting it. Do they all understand the massive potential afforded by the latest in Internet protocol communications? Of course not, but they know there are more choices, ranging from open source to hosted systems to IP PBXs. It is astounding in fact how many choices there are for a small business these days.
 
According to AMI-Partners, the growth in this space is expected to hover at 11% between 2005 and 2007. The research firm estimates that, at the end of this year, the total size of the SMB communications space shall be $6.7 billion. The IP PBX business is slated to grow at a — hold on to your hat and have a seat — 33% for the next five years.
 
One item cited in the study that I have mentioned before is Microsoft’s involvement in the market via their unified communications initiative. AMI feels Microsoft will act like lighter fuel on a burning fire. I believe prices per seat will increase as businesses start to purchase communications applications along with their phone systems.
 
My belief is that the larger companies will also be spending much more on communications systems as a result of all the excitement occurring in the small end of the market. Indeed, many large companies tend to have so many branches that they act like a conglomerate of SMBs. So, expect the final numbers to be potentially higher than this study predicts. Of course this assumes no new massive geopolitical events of the negative type.
 
Naturally, if the unified communications market is really going to grow to its full potential there needs to be an objective educational resource supporting the market. I truly believe the value of communications to an organization is greater than almost every corporation realizes.
 
I have heard many people on the Internet say there is no “killer application” in the voice world and I believe some of these people have it wrong. Voice and IP communications together is the killer application. This is especially true as IP communications embeds itself into your organization through SOA and other breakthrough technologies allowing all corporate applications to leverage the full potential of communications.
 
Pressing a single button and instantaneously being connected via a video conference and screen sharing to coworkers and customers around the world regardless of network or device type is a killer application. Anything yielding orders of magnitude productivity increases is a killer application.
 
Embedding presence throughout our applications and collective corporate psyche is a killer application. Having smart phones that are really smart and know what do to with phone calls depending on time of day, who is calling and what you are doing, is a killer application.
 
More importantly, what I am describing above is the growth of telephony from something commoditized to something truly invaluable.
 
Think about it this way: PCs and MP3 players are commoditized. iMacs and iPods are not. Do you know why? Because I will pay more for Apple products and part of the reason is the devices are simpler to use and have the integration the PC still lacks after all these years.
 
Consumers and businesses are paying more, much more for products where there is added value — products where the software and hardware is unified and thus allows us to be more productive. Apple in a way portends the future of unified communications. UC will be something companies pay more for because they get more in return.
 
And Now It Can Be Revealed. . .
 
But getting back to the original premise — where will people learn about UC technologies and the amazing things they can do for the enterprise?
 
Don’t fret, we at TMC have the answer. After taking careful observations of the market and spending considerable time deliberating over the way the IP communications world is evolving, TMC has decided to transform SIP Magazine into Unified Communications Magazine. SIP will end in May and Unified Communications will commence with the June issue.
 
The response to this news has been very positive thus far and although the market is still in its early stages we believe there is a great deal to teach and help both the enterprise and service providers as they venture forth into the world of Unified Communications. That said, TMC, with its stable of four communications magazines, websites and events, is the perfect organization to help lead the charge into the brave new world of UC, just as it had done previously with Internet Telephony and, prior to that, CTI (Computer Telephony Integration).
 
So what was wrong with SIP Magazine you ask? Nothing really — the technology is still sound. Indeed, the SIP protocol has disappeared into the very machinery itself of IP communications, busily working behind the scenes of countless VoIP and multimedia calls today. You will even find a prominently displayed section in Unified Communications magazine dedicated to SIP in every issue.
 
I would love to hear your feedback on this news and as always we look forward to serving your educational and decision-making needs with the highest quality content available anywhere. Thanks as always for reading.
 
Where the Development Opportunities Lie
 
Ecosystems. That is the key word in the development market. Ten years ago if you wanted to develop communications applications you generally worked with Dialogic, NMS, Brooktrout (now Cantata), Aculab, Pika, AudioCodes, etc. There were TAPI and TSAPI interfaces for Microsoft and Novell as well but that was about it. Then we had some application generator programs we could use to rapidly roll out apps but this was the extent of the choices you had.
 
Now things have evolved dramatically. We have all of the above and Asterisk, Skype, Avaya, Pactolus, Cisco, Nortel, Inter-Tel, Salesforce.com, etc. In addition, many of the board vendors from the nineties have now produced HMP-based solutions allowing even more flexibility in providing solutions for customers.
 
And there are real opportunities in working with all of the above companies. Ecosystems have been a great advance for companies looking to leverage existing and growing communities of customers. It just makes so much sense to have the above companies help promote your products for you.
 
I have heard nothing but good things from companies who provide solutions for SalesForce.com, Skype and Avaya for example.
 
But there are so many other opportunities out there it is a bit bewildering. The question developers must ask is where the largest opportunity is so they can allocate resources accordingly.
 
So here is a brief summary of some of the opportunities out there and what my take is on each:
 
Open Source: this market is growing at phenomenal rates. Expect to see some amazing market research in the upcoming months on how many companies and service providers are using open source IP PBXs now. This is a no brainer.
 
Unified Communications: Microsoft, Cisco, Nortel, Avaya and others are pushing this area and Steve Ballmer has said Microsoft programming tools will allow developers to easily write UC applications. This will be a huge market and presents tremendous opportunity
 
SIP: Everything will be SIP-enabled. Your car, your gadgets… Perhaps everything except Skype. You need to embrace SIP in your communications development.
 
Skype: Speaking of which you should develop applications that work with Skype and you should find ways to make sure your existing solutions interoperate with Skype. Businesses will need to have Skype Interop in the next few years so start developing Skype compatible products today.
 
SOA: Service providers and enterprises will all be standardizing on SOA so be sure your products embrace this architecture as well.
 
IMS: This is a massive opportunity and IMS will happen. The question is exactly when it will happen. Start researching and developing now so you are ready when the tidal wave of IMS enabled networks begins.
 
Wireless: This is a super-important segment and WiFi/WiMAX/DECT and Dual mode phones and gadgets will proliferate. Games will be voice-enabled. MP3 players (iPhone, etc.) will be voice enabled. It is getting tough to predict a device that will not be voice enabled.
 
The excitement in this space is beyond anything I have seen ever in VoIP or communications development ever! It is out of control and confusing and complex but you know what? The communications barons of tomorrow are developing the coolest products today.
 
If you are interested in learning more about the opportunities and perhaps just as important the opportunity to network with others who are part of the above ecosystems and are writing applications in the above fields I invite you to the Communications Developer Conference May 15-17, 2007 in Santa Clara, CA.
 
Some of my favorite sessions at this conference are integrating voice into .NET, Nortel’s IMS Development Community, Developing Unified Communications Applications and Video over WiFi.
 
There is so much more; I could go on talking for a long while about how exciting this market is. This show marks a milepost in the evolution from the name “VoIP Developer” to “Communications Developer”. Accompanying this is the observation that, as the communications market converges, the opportunities to generate revenue grows exponentially.
 
The opportunity is here. The tools are here. The networking will be at the show. Will you be there? I hope so. I will see you soon!
 


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