Comms Business takes a look at the PBX market and concludes that there is still life in the old dog yet. However, as we report, firms do not want to be stuck with old technology as they emerge from the recession.
The latest figures we have on PBX sales reveal that the market ‘continues to be challenging’. This, according to UK analyst firm MZA Consultants, refers back to Q2 last year so we are eagerly awaiting updates on their last report which indicated a decline of 4% year-on-year in Q2 2013 (period April to June 2013 inclusive) and a 1% decline sequentially.
We all know that PBX sales are under pressure but there are continuing success stories and experiences in the channel as John Bird, Head of Systems and Support Services, Exertis Micro-P Unified Communications reports.
“It’s great to report, that specifically over the last six months, the PBX market has been significantly more buoyant than it has been in recent years. We’re pleased to have experienced double digit revenue growth year on year across both our Samsung and NEC business units; supported by a developing tendency for smaller resellers trading more consistently as they close more deals”.
We’ve seen growing trends over the last 12 months that shows end-users demanding what were traditionally high end system features in smaller systems – specifically desktop CTI integration with incumbent CRM systems, mobile integration and call management and call recording solutions. We’re also seeing a higher attach rate of applications with systems, driven both by our own reseller education training courses as well as by end-user demand.
End-users with as few as 6 or 8 extensions still require management statistics from their PBX and benefit more from CRM and database integration -in fact I believe they benefit more, as staff at these smaller firms tend to multitask more and have more than one role to play in the organisation, typically using multiple CRM applications (e.g., Sage and Salesforce) and are the first to benefit from the efficiency and productivity increases that CTI integration provides them with.
The only hindrance a reseller may experience delivering these solutions is their own engineering skillsets, however Exertis Micro-P are well placed to offer white labelled professional engineering services. Our award-winning channel support team are experienced and on hand to offer installation and maintenance services to ensure a reseller can deliver any application, regardless of their own technical capabilities.”
Likewise Paul Burn, Head of Category Sales for Nimans, has also experienced sales growth in the last year.
“We generated double digit growth with systems sales last year and expect these strong trends to continue throughout 2014. This was across all our system brands – the big traditional vendors – even into the sub 50 market which was perceived to be suffering the most. From our point of view this sector is quite buoyant. This is due to a combination of factors. Economic recovery obviously helps.
I think the recession has made resellers sharper. They are able to spot and close opportunities better than before. It’s also made us better in helping them, so everyone has raised their game. Equally resellers have a lot more weapons in their armoury to impress a client. Take UC and collaboration and all software applications. Whether they are selling them or not is open to debate, but they are definitely using them to sell. There’s a lot more to talk about rather than I can just help you with your lines and minutes. Demonstrations are a lot more interactive which will continue to open doors and drive sales further forward. The lean days are hopefully over, but as an industry we’re not fully there yet. No one can afford to be complacent.”
One Side of the Coin
Iain Sinnott, Head of Sales at VanillaIP sees SMEs emerging from the recession with office communications solutions they purchased when their mobile phone was a Nokia 6310i, hungry for smarter solutions, and willing to acquire technology that adds to their bottom line. No one wants to pay more for the same, but SME’s are smart and they will buy a solution which extracts more value from their key asset, their people. iPhones cost more than a 6310 but they’re really not comparable products.
The only lesson we need from the past is that in telecoms things change, and when change comes it is fast and widespread so make sure you are on the side of the people writing the next page of the telecoms story not the last page!
And Neil Coulthard, Hosted Sales Specialist at Gamma says, “It says something when even Panasonic is making moves in to the hosted telephony market. Until recently I had always said that there is a place for the PBX but now most vendors are gearing their PBX up to sit in data centres.
We understand that for resellers hosted telephony is a different model to CPE based telephony but we are providing free handsets and free calls which gives resellers more to play with in terms of margin opportunities. Over the next 12 months I foresee further erosion of the PBX market and big swing to the hosted model.”
What Turns On The SME?
Paul Burn at Nimans points to what many would seem as obvious but is often overlooked.
“For a reseller, the system has to be saleable enough to maintain margin. Applications need a tangible worth to enable them to justify the bill they put in front of their customer. Reseller support is vital from a distributor; helping them with quotes and general service. Resellers will sell what their customers think they will buy. This is based on all sorts of buying points. It could be the death of a legacy system or they may be growing and want to do things differently. It’s part of being more nimble, flexible and mobile in terms of how the whole world has changed… instant communication anywhere. What really turns on a customer is demonstrating a reason to change. There may be a million reasons but it’s down to the skills of the salesman to tailor a solution. Ultimately it’s about money. Will technology save the end user money on what they’re already doing or make them more money in the future.”
The Flip Side
Steve North, Managing Director- Stripe 21 believes that it is a fair observation that suppliers of premise- based phone systems (CPE) are proving to be a resilient bunch!
“The value proposition for a hosted IP telephony system has been the ability for the SME sector to avoid capital investment, whilst gaining the features available to larger businesses using fully- featured PBX’s (business phone systems). However, the reality is that 96% of telephony remains with the traditional on- premise PABX (Gartner Group 2012), with leasing companies more than happy to take the sting out of up- front capital investment in CPE.”
A year ago I publicly stated, ‘The PBX is dead, long live the PBX’, says Robin Hayman, Product and Marketing Director at SpliceCom.
“So what’s happened in the intervening twelve months? On the face of it, very little, apart from the fact that, as a company supplying only business phone systems, phones and associated applications, we’ve witnessed a very healthy 30% increase in sales over the period. But dig a little deeper and you’ll find that there’s been some fundamental shifts in what we now see being purchased and deployed.
We feel that we’re ideally placed to comment on trends in the PBX market in this country. We’re a British company and the UK is our primary territory. We supply, soft, hard and virtual PBXs – all running exactly the same Maximiser OS – for deployment in on-premise, cloud, hosted and hybrid solutions. Indeed, we introduced our range of soft and virtual PBXs to give our customers’ – not to mention our channel partners – greater choice and flexibility. Interestingly, this has lead to interest from, and signing of, a higher percentage of ‘non-traditional’ resellers over the past twelve months.
Sales of our ‘hard’ IP PBXs were slightly up over the past year, but it’s the soft/virtual PBXs that have enjoyed a significant rise in demand. At the outset our range of S8000 soft/virtual PBXs found favour as competitively priced Business Continuity/Disaster Recovery solutions, however the last 12 months have seen them move centre stage, providing the foundation of many of our largest, multi-site systems, irrespective of where they may be located; on the customer’s premises, hosted or in the cloud.
The catalyst for this growth can be traced back to the availability of our Flexible Edge Solutions (FES) that, when deployed across multiple sites, in conjunction with a central soft/virtual PBX – wherever it may be – delivers a hybrid solution. Remote, fully survivable gateways, smaller, fully networking soft, hard and virtual PBXs, legacy connectivity for analogue phones, ISDN Trunks and existing PBXs, homeworking and full mobility IP Softphone solutions for SmartPhone and Tablets, PCs and Macs; they’re all part of the FES portfolio and can be mixed and matched as required to provide a single seamless solution where everyone has access to the same facilities, features and benefits – wherever they might be.
To summarise, we’ve found that by increasing flexibility and choice in the past twelve months, across all aspects of our systems – in the core, at the edge, where and how they’re deployed and how they’re purchased – for our channel partners and their customers’ alike, has resulted in 30% year-on-year growth. Expect more of the same during 2014.”
Simon Skellon, head of sales at Mitel, points out the growth of internet-based communication in business delivers unparalleled flexibility and worldwide connectivity, enabling organisations to maximise productivity and competitiveness.
“Resellers that are part of the Mitel authorizedPARTNER programme are ideally placed to take advantage of this opportunity by utilising a breadth of enterprise-class communications solutions that can integrate with any industry-standard infrastructure and any device, to meet any customer’s unified communication and collaboration needs.
Unified communications can play a significant role in transforming collaboration in business and research commissioned by Mitel strongly supports this. As many as 83% of organisations that have adopted UC have realised tangible benefits and perceived challenges such as securing investment and senior buy-in are far less of an issue in reality.
This research provides real-world evidence of the benefits of UC and the channel is ideally placed to drive further UC adoption by educating customers on the value that UC can bring as part of integrated voice and data solutions.
Mitel is focused on delivering solutions that enable the channel to deliver a multimedia enterprise to customers, with best-in-class voice through MiVoice Business and MiVoice Office, advanced unified communications and collaboration features through MiCollab and enhanced customer service offerings with MiContact Center.
The launch of MiVoice for Lync in 2013 enhanced the Mitel portfolio, bringing business-class voice features to Microsoft Lync users in a simple, cost-effective and reliable solution. Optimised for Lync, the solution removes the complexity and cost of integration, enabling our partners to offer Mitel’s advanced telephone technology alongside Lync to unite best-in-class voice communications with IM, audio, video and web conferencing.
As MZA states, the market is challenging but there are plenty of success stories out there and whilst not every vendor can match SpliceCom’s 30% growth in sales over the last year it was great to see double digit growth from distributors Extertis and Nimans. There are always a minimum of two sides to any story as VanillaIP and Stripe 21 point out
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