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Microsoft/Nortel UC relationship in peril?
Nortel's bankruptcy filing on January 14 may put the breaks on its high-profile unified communications relationship with Microsoft.
In November the two companies said their four-year Innovative Communications Alliance (ICA) to develop, sell, and roll out UC and VoIP technology to the enterprise was "solid and intact," said Network World. However, yesterday's Chapter 11 bankruptcy filing raises questions about how long the deal will last.
Microsoft has to be concerned, since Nortel is currently more worried about staying alive than investing in new product development. Further, analysts say that Nortel's large base of VoIP customers is vulnerable to competitors looking at the chance to steal the business. The next 90 days of corporate activity, coupled with how Nortel communicates with its existing customers, will be critical to the relationship.
Microsoft is publicly taking a wait-and-see stance until it gets a better look at Nortel's financial reorg plans. The ICA UC deal is set to expire in 2010, but the bankruptcy courts or Nortel executives may be forced to take more drastic measures before then.
Nortel may try to salvage what it can of the Microsoft relationship, since it gives them a foothold into the growing market of UC and lines up with Nortel's enterprise customer base. But talk of "business as usual" by Nortel execs has a sense of déjà vu all over again, and any sales of assets to provide operating capital for other operations just went into the bargain-basement bin.
For more:
- Network World thinks about the Microsoft/Nortel UC deal. Article.
Related articles
Nortel files for bankruptcy
Nortel's (latest) crash - FierceVoIP
Comments
Posted by Jeremy | January 15, 2009 - 10:09am
I note that the guys at IPFX have released a Nortel UC product, we were looking at Microsoft UC, but reading the above makes me wonder.
Posted by Francis | January 15, 2009 - 3:12pm
Microsoft's inexperience in telecom led them to select Nortel as their initial UC partner for OCS. After the first year, Microsoft learned of Nortel's challenges and its declining standing among telco service providers. This is why Microsoft reversed its position on BroadSoft -- going from arm's length partner to strategic UC partner. Look for Microsoft to put its energies in 2009 into penetrating BroadSoft's customer base.
Posted by Alex | January 20, 2009 - 11:47am
Well, as for BroadSoft's UC solutions with Microsoft……BroadSoft is certainly proud of our strong relationship with Microsoft, and pleased that our joint solutions have been widely embraced by the market. We're seeing takeup for both our "All-Hosted" UC solution (SaaS-based UC from BroadSoft and Microsoft), but also our "Hybrid UC" solution (premises-based OCS with Hosted BroadWorks).
What's been most rewarding for the BroadSoft squad has been to be part of a partnership that benefits (1) both vendors; (2) our service provider customers; (3) the businesses served by these service providers. Microsoft gets access to BroadSoft's 400+ worldwide service provider base; BroadSoft has now 'upgraded' their Hosted VoIP solutions into Hosted UC solutions, and customers and service providers are riding this new wave towards SaaS-based UC, because solutions like this are a quantum leap beyond traditional IP Centrex solutions.
So…I don't think we'll see any impact to UC opportunities - we're still excited about UC opportunities for us and our service provider partners.
Alex at BroadSoft
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