Convergence - the hardest sell

There is a mood shift going on within big companies. Where once technology could be sold to IT departments because the staff quite fancied playing around with it, now the techies have had their toys taken away. They are busy meeting finance directors, trying to justify their existence, and being questioned harshly about what they bring to the business apart from costs, headaches and jargon.

In this environment, convergence is not an easy sell to corporates. Competing proven technologies, such as enterprise resource planning and SANs, exist and can offer real benefits in terms of customer and data management.

Selling the advantages of lower costs and better access to a communications manager or IT manager might prove easier, but if you can't sell the advantages of something as complex as convergence in plain business-speak, you're in for a rough ride. Increasingly within corporates, the IT and communications functions are merging and then merging again with areas such as finance, and businesses are interested in the investment case for technology.

The promise of voice over IP (VoIP), voice and data integration and so on sounds good, but there will always be another application. Once it was all voice and data, today it is all voice, data and video. So with Wap currently grabbing all the headlines, is computer telephony integration (CTI) as extinct as a dodo, or are corporates still crying out for it?

The sales pitch for convergence is simple: it cuts costs, delivers a better service and provides for the latest applications. In marketing-speak, it raises productivity, improves interaction with customers and employees, reduces the cost of supporting internal network infrastructures and allows companies to compete better.

But the downside is a lot of upheaval and the management of a complex environment.

Cisco thinks scales
Cisco is on the acquisition trail, aiming to buy 25 companies this year. Despite this, last month it announced 10 new products that are aimed at the enterprise convergence market and which fit within its Architecture for Voice, Video and Integrated Data (Avvid), launched in September.

David Passmore, director of research at The Burton Group, said: "Over the past eight to 12 months, there has been a tremendous amount of interest in IP telephony, but one of the stumbling blocks was the perception that the technology was only for small installations and couldn't scale. Cisco has presented a solid architecture and is now backing it up with a wide range of IP telephony products that are aimed squarely at the large enterprise."

This is code for the market is about to take off because finally there are some products to sell. Those products include Cisco Callmanager 3.0 software, two Cisco IP Phones - 7960 and 7910 - and a new Cisco Media Convergence Server, MCS 7835. New for the Catalyst 6000 family are integrated gateway interface cards - one analogue and two digital - and a 48-port 10/100 ethernet switch module with integrated QoS and a migration path to in-line power capabilities. For existing installations, Cisco is introducing an Inline Power patch panel, and a standalone, modular analogue trunk/station gateway.

Two weeks earlier, Larry Carter, chief financial officer at Cisco, said the company will continue to look for partnerships, particularly in the areas of developing telephony products in systems that handle voice, data and video.

That a company such as Cisco admits that it hasn't got all the answers to voice and data integration while still announcing products, shows that the technology is moving so fast that nobody can afford to stand still for a moment.

An Avvid admirer
US analysts Current Analysis described the Avvid strategy (not the products) as representing the fifth and final phase of Cisco's enterprise multi-service strategy. "It brings together the company's enterprise-focused acquisitions and product developments into a single architecture," a Current Analysis representative said. "Cisco needed to announce Avvid not just to conclude its multi-service strategy, but also to combat competitive moves by Nortel and Lucent in the enterprise converged network space. In particular, Nortel's Inca is a highly competitive solution with Avvid."

Among the few markets for convergence are the internet and telecoms sectors. In March 1999, UK firm X-Stream awarded Lucent a £17m contract to provide internet access, VoIP technology and related services for X-Stream's European network.

Nortel Networks is only just rolling out a unified messaging service across Europe and North America, although it went live with 950 users in Galway, Ireland last year. The system, called Callpilot, was then extended to the company offices in Maidenhead, with the intention to roll it out across Europe and North America later this year.

Corporate users in traditional areas are almost ready to start setting up trials to see what is available today in convergence technology, as well as to aid in their planning for transitioning their networks to take advantage of a converged infrastructure.

Few enterprise users are ready for large-scale CTI, and those that are will be asking questions such as: How do I take advantage of application integration so I can benefit from a converged network, and what transition plans and what supported feature sets does my supplier have?

There are, of course, other entrants in the enterprise convergence market outside the big three, Cisco, Lucent and Nortel. Last month Eircom (formally Telecom Eirann, the Irish telecoms company) signed a deal to sell, market and support Interactive Intelligence's all-in-one communications software solution, known as the Enterprise Interaction Center (EIC).

Des White, product manager for Business Systems at Eircom, said: "EIC's open, software based interaction management platform will allow us to respond faster to our customers' needs, including those with planned or existing web initiatives. EIC's built-in web Chat, web Callback, and voice-over-internet capabilities will enable our customers to ramp up faster than their rivals, giving them a critical head start."

EIC is said to be a unified communications solution that virtually eliminates the type of integration efforts associated with traditional computer telephony. The savings are said to come from phone, fax, email and web interactions via a single server, and the better service delivery based on EIC, which allows firms to manage customer interactions more efficiently.

EIC replaces many proprietary devices, including automatic call distributors, interactive voice response systems, web gateways and CTI middleware systems. This solution is aimed at the enterprise and call centre markets, but VARs should be aware of the transition issues and remember that it is applications that will drive this market. Distance learning is one of the key applications for which convergence is highlighted.

For the future, up and coming firms such as Cyras, run by ex-employees of Fibrelane - which subsequently split into Cerant and Siara before these were sold to Cisco and Redback Networks for $7.2bn and $10bn respectively - are bringing cheaper convergence infrastructures to market.

Cyras claims it will sell - at about $100,000 - a box that will replace four or five traditional networking and telecoms boxes delivering voice and data over optical fibre. The company plans to roll out its first equipment in the next six to eight months. The US market for convergence equipment is expected to be worth $20bn this year.

Elsewhere, and ironically given the recent news that it is pulling out of high-end networking, 3Com's Santa Clara-based Convergence Lab tests and demonstrates a broad range of converged networking products.

The Lab's LANs consist of ATM and Gigabit Ethernet backbones with switched Ethernet to the desktop. WANs featured include virtual private networks, Frame Relay, T1/T3, ATM and ISDN as well as cable modems, xDSL and modems for remote access. It also demonstrates SANs based on Fibre Channel technology.

The Lab uses these infrastructures to demonstrate streaming video - including video on demand and multicast video, video conferencing and integrated telephony - and traditional critical applications. But the fact that there are more products in the Lab than in the market shows the nascent nature of the sector.

Open to persuasion
Corporates will remain interested but sceptical about convergence until the telecoms and networking companies prove themselves able to deliver quality of service to agreed standards.

Cisco says in one of its briefing documents: "One of the most promising uses for IP networks is to allow sharing of voice traffic with the traditional data and LAN-to-LAN traffic. Typically, this can help reduce transmission costs by reducing the number of network connections, sharing existing connections and infrastructure." Alas, today it remains a promise.

The correct strategy for resellers is to watch the market and think about the value they can bring to the party once convergence products really hit the market and corporates become less sceptical.

While the telecoms and networking companies fight the convergence war, the captains of UK industry are unlikely to want to get dragged into the battle. While most now own mobile phones, they don't trust the internet, and in a complex telecoms market they may not be willing to withstand the upheaval and risk of deploying convergence technology.

In 1994, a group of UK IT journalists were invited to a video press conference with some senior people from Tandem computers. They trooped down to a BT building in the City, sat in an airless room and watched a screen on which shaky pictures were delivered via satellite from California. If they wanted to ask a question they had to stand up and shout into a microphone built into the table. BT would neither confirm nor deny that the conference cost it £25,000 for one hour.

To stream video, voice and data over IP is cheaper these days, but the quality hasn't improved much. While corporates like the idea of saving money on their phone calls, spending all day pressing the redial button is not an option. The technology to make convergence work is coming. Meanwhile, keep your eyes peeled and your powder dry.

Conclusions

• Convergence is a hard sell to big corporates, which already have many other technologies being pushed at them.
• A much clearer business case needs to be made for new technologies than before.
• Cisco, Nortel and Lucent are the main enterprise convergence players, but a number of other companies are entering the market.
• Resellers should watch the market and decide what they can bring to it when it takes off.