CheapPhonesHere.Com

CheapPhonesHere.Com

By Dave Michels June 6, 2013 1 Comments
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CheapPhonesHere.Com by Dave Michels

PBX vendors have historically distributed TDM telephones through authorized channels. This made sense as telephones were only purchased by existing customers and customers often required additional hardware or services to make them work. The same was true with early (proprietary) VoIP endpoints.

SIP promised to change the arrangement, as it enabled interoperable IP phones. Vendors such as Aastra, Polycom, and snom emerged as early purveyors of independent SIP phones that could be used on third-party voice platforms. These and other phone providers directly targeted prospects that weren’t already customers by using open (Internet and wholesale) distribution meaning non-authorized dealers and even end users could directly purchase them.

As enterprise UC vendors slowly embraced SIP endpoints, it was largely expected that they too would embrace open distribution. It was also assumed customers would freely adopt whatever brand SIP endpoint preferred without allegiance to the vendor of the voice platform – neither of these predictions turned-out to be true.

For the most part, enterprise customers of Cisco, Avaya, Mitel, NEC, and Siemens Enterprise still purchase like branded endpoints from authorized resellers (Cisco has multiple lines, and some lines are available through open distribution). In other words, despite the standard, simplicity, and general compatibilities of SIP endpoints, most enterprise endpoints are still sourced through closed distribution networks.

Does closed endpoint distribution for SIP endpoints still make sense?

Dealers enjoy the account control and profit from endpoints, but lower prices might stimulate more demand (and licenses). More importantly, the Internet has generally flattened distribution across multiple industries. If endpoints could be distributed more efficiently (without the proverbial middle-man), shouldn’t they? Particularly since many independent brands are sold through open distribution at lower prices.

Endpoints are peripherals similar to printers and keyboards. The ability to protect such distribution channels with closed distribution is rapidly disappearing. It seems inevitable that IP endpoints will move to open distribution, possibly driven by the vendors themselves. Manufacturing is always about quantity, so if a vendor can significantly increase sales volumes (by selling into more platforms) then it will realize cost savings potentially creating a self-feeding cycle.

Softphones continue to grow in popularity resulting in increased costs associated with manufacture and distribution of hard phones. It may even make sense for some vendors to drop out of the endpoint business as something needs to give.

A current barrier to overcome is the SIP standard for endpoints is limited. Many vendors address this with various software loads that narrow the gap between SIP and proprietary IP phones. This is keeping endpoints from becoming commodities.

We are likely nearing the tipping point where the benefits of open distribution will outweigh the costs for vendors. It will be a big impact to dealers – potentially the final straw for some.

Is open distribution good or bad for the industry?

What are the potential impacts of open distribution of major brand SIP endpoints?

 

1 Responses to "CheapPhonesHere.Com" - Add Yours

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Syed Ahmad 6/7/2013 3:54:51 AM

Dave,

On-Premise PBX & Voice Platform vendors earn most from terminals (i.e. SIP / IP Phones). Further, most don't have direct relationship with end-customers as SIP standards aside, there are many issues that make it nearly impossible for end-customers to directly put together SIP endpoints with any enterprise voice platform.

The idea of MGCP and then SIP end-points make sense for Cloud based standard residential services - as with triple-play or quad-play providers because the "feature list" for residential (CLASS 5 features) is quite limited and can be addressed by MGCP / SIP end-points.

However - basic SIP standard (RFC3261) on its own can't handle enterprise telephony (such as BLF Keys, Call Waiting, Call Transfer, Conference Calls, Paging, Call Park/Retrieve, etc) and actually a series of RFCs and related technologies (XML based backend IP phone provisioning, Connection of SIP phones to Corporate directories - such as Active Directory, XMPP or SIP SIMPLE Server for Presence, Session Security via SSL/TLS, Media/Audio security via sRTP, Bulk IP assignment via LLDP-MED etc) are needed that are all too complicated to be handled just by Plug-n-Play using any off-the shelf SIP phone.

In addition to all the technology issues, presently end-customers are still "Owned" by IT/Data System Integrators, and Telecom Dealers/resellers hence Manufacturers continue to support the Channel approach rather than the direct approach.

As new UCaaS solutions come to the market and the channel realizes that instead of box moving, they can just sell some "Activation Codes" and remotely manage all customers (no more truck rolls) and other than the SIP terminals, or rather voice functionality - everything can be delivered over the top (OTT) over IP/data - then the model will begin to slowly change.

Finally I would like to highlight that SIP softphones failed miserably on PCs, and only recently have done a resurgence due to Mobi

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