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The Rise of Cloud Communications: A Big Shift in a Big Way

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The Rise of Cloud Communications: A Big Shift in a Big Way

January 30, 2012
By Erin Harrison
Executive Editor, Cloud Computing

Without a doubt, one of the hottest topics in cloud computing right now is cloud-based services such as cloud communications – also known as unified communications as a service.

As a result of the economic downturn of 2008-2009, many companies cut business travel expenses and filled that gap with increased use of voice and video conferencing, subsequently finding that external services could be leveraged since they only had to pay for what they needed.

While cost may no longer be the top driver of cloud communications today, according to Joe Staples, chief marketing officer of Interactive Intelligence (News - Alert), other benefits including flexibility and scalability, which are now the driving forces behind the rise of UC as a service. The use of cloud services IT applications such as Customer Relationship Management systems and business expense systems give companies a more efficient way of operating, which gives way to better productivity, as well as the cost savings factor mentioned above.

Before heading down to Cloud Communications Expo in Miami this week, TMC (News - Alert) CEO Rich Tehrani recently had a chance to catch up with Staples, who shared his insights about the benefits of cloud communications and how providers can leverage cloud to deliver on the expectations among enterprises. Their full exchange follows below.

RT: How has cloud computing changed the communications landscape over the past year? 
JS: It’s changed the buying and deployment model completely. For vendors, it’s meant a shift in business models. There are new competitors and a number of new considerations in the buying process. The move to the cloud is a big shift in a big way.

RT: What are enterprises looking for from their communications providers and how can those providers leverage the cloud to deliver on those expectations? 
JS: They want reduced IT requirements, increased flexibility, faster deployment times, and lower upfront capital costs. The right cloud communications solution successfully meets every one of those requirements.

RT: Cost savings is always the first thing mentioned when it comes to benefits of cloud. Aside from cost, where is the value proposition in cloud communications?
: Cost savings has actually moved down the list. It is now maybe second or third. Increasingly, customers are looking for the flexibility the cloud provides and the ability it gives them to focus more on their core business and less on building out IT infrastructure.

RT: Will the cloud serve to fragment the industry or strengthen existing ecosystems?
: Cloud communications provides customers with additional choices and that is always a good thing. It is also spawning new vendors; again, that’s a good thing for the industry. The only guys who should worry are the vendors who are failing to adapt to the market shift toward the cloud.

RT: Is cloud communications primarily an SMB service? How can enterprises benefit equally?
JS: We’ve seen more traction with larger enterprises: multinational deployments with hundreds or thousands of endpoints. Cloud benefits are amplified the larger the organization.

RT: What will be the greatest growth area as a result of cloud (e.g., mobility, video, social media, CEBP, etc.)?
JS: I’m not sure it will be focused on a single segment. As customers shift more and more communications to the cloud, they will continue to look at all applications. So it is a boost to unified communications, process automation, the contact center, IVR and many other areas.

RT: One of the greatest growth areas as a result of cloud is embedded multimodal communications in applications such as Skype and Facebook (News - Alert). What impact do third-party communications apps like these have on business communications providers?
JS: Those applications provide ubiquitous access. So, for example, instead of deploying a proprietary authentication method for our customers, we are able to take advantage of the wide deployment of Facebook and allow mobile users requesting self-service in a contact center to authenticate through their Facebook account.

RT: Can Microsoft make a splash with its promised integration of Window Phone (News - Alert) and Windows 8?
: No crystal ball answer on that one. We will watch it closely, but it is a wait-and-see item.

RT: When will the cloud make the on-premises PBX obsolete?
JS: Not in the foreseeable future. Certainly not in the next 10 years. Cloud is growing at eight to 10 times the rate of premise solutions in some segments. That said, for some businesses, a premise-based option is going to be a better choice. A lot of that comes down to company culture, investment in existing infrastructure, resistance to change, and financial situation. The cloud is here to stay and it will erode the premise installed base, but it isn’t a complete change-out, such as what we saw when IP telephony replaced TDM.

RT: Why is Cloud Communications Expo a must-attend event?
: The thing we like about the event is its focus. Other cloud events that we’ve attended try to be everything to everybody. If it has a cloud slant, they will include it. Cloud Communications Expo is focused on communications and the impact the cloud has on communications. Much easier for attendees to really get at the information and answers they are looking for.

To find out more about Interactive Intelligence, visit the company at ITEXPO East 2012, being held Jan. 31- Feb. 3 at the Miami Beach Convention Center in Miami, Fla. ITEXPO (News - Alert) is the world’s premier IP communications event. Visit Interactive Intelligence in booth 606. For more information on ITEXPO registration click here.

Stay in touch with everything happening at ITEXPO… Follow us on Twitter.

Erin Harrison is Executive Editor, Strategic Initiatives, for TMC, where she oversees the company's strategic editorial initiatives, including the launch of several new print and online initiatives. She plays an active role in the print publications and TMCnet, covering IP communications, information technology and other related topics. To read more of Erin's articles, please visit her columnist page.

Edited by Rich Steeves

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