Will enterprises ever warm up to Skype for business communications?

Unified communications (UC) pros generally regard Skype as a consumer service that can supplement enterprise UC tools, but they hesitate to depend entirely on Skype for business communications. Skype is obviously courting enterprises by partnering with companies like Avaya, but it remains unclear if the Internet telephony giant can convince enterprises that it has the control, reliability, features and security that UC pros expect of their primary voice, video and collaboration platforms.

"Right now I think they're just for the SMB. That's as far as they could go," said Ed Garcia, IT director at Horn Group, a small San Francisco-based public relations agency. "They have a good chance of being a true enterprise player, but of course they have to change their image because Skype is definitely [seen as a] consumer [tool]."

After months of testing Skype-Business Version -- the Web-based VoIP provider's business-class product, formerly called Skype for Business -- Garcia has standardized on Skype as his primary video conferencing platform. Employees in his California and New York offices use it regularly to hold meetings with each other. Skype-Business Version has been integrated into the firm's video conferencing room equipment for single-click access.

Garcia's users also favor Skype's screen-sharing tools for presentations during video conferences in lieu of other collaboration tools, such as Cisco Systems WebEx and Citrix GoToMeeting.

But video conferencing is not a mission-critical communications application for the firm, and Garcia said he would not feel comfortable relying on Skype for business IP telephony.  He is troubled by the platform's susceptibility to spam and adware, occasional outages and its lack of Microsoft Active Directory integration. Another sore point: limited administrative tools. 

"Recently, one of the office's video [streams] keeps cutting out during the meetings," Garcia said. "I tried every control and every parameter, and nothing seems to help. If [Skype] want[s] to play enterprise, they need to offer more control."

Skype's plan for going after the enterprise

Over the past few months, Skype has made a number of moves that signal its seriousness about going after the enterprise market. At the 2011 Consumer Electronics Show (CES) last week, Skype announced a multipoint video conferencing feature to accommodate up to 10 participants in Skype-Business Version at $8.99 per user per month. Late last year, it launched a channel program, entered into a strategic alliance with Avaya and hired away high-ranking Cisco executive Tony Bates to be its new CEO.

At the same time, Skype's enterprise credibility took a blow when its service suffered from a widespread 24-hour outage between Dec. 22 and 23. In a blog post, Skype CIO Lars Rabbe explained how Skype's peer-to-peer (P2P) architecture "became unstable and suffered a critical failure."

Executives at Skype Enterprise, the provider's enterprise arm, shake off the notion that the outage is illustrative of Skype's ability to support business customers. About one third of Skype's registered user base uses Skype for business communications, according to David Gurlé, vice president and general manager of Skype Enterprise.

More on Skype for business communications

Learn more about the security concerns IT pros should weigh for business Skype usage.
Thinking about Skype for your remote workforce? Read about the pros and cons of Skype for mobile workers.

How do Skype and other VoIP services fit into a disaster recovery plan?
"From an enterprise perspective, we are looking into providing greater reliability for our customers and ensuring their mission-critical needs are met against the service we can provide," he said. "Voice over IP gets more and more reliable every day … so we feel that on a best effort network, it gets better and better."
Skype isn't in the market to replace an enterprise's legacy UC infrastructure and doesn't see itself competing against incumbent UC vendors such as Cisco and Avaya, Gurlé said.

"We are not in the substitution market. We are in the complementary market," he said. "It's kind of an overlay across other communications infrastructure and application that people have deployed."

Skype for business communications: Tolerated but not encouraged

Most large organizations in the United States condone but don't officially encourage or support employees using Skype for business, according to Irwin Lazar, vice president at Nemertes Research. Formal adoption appears more rampant in Europe, he said.
"In the last two years, I've come across one organization that actively relies on Skype and its official policy is that you'll get a Skype account," Lazar said. "It was a nonprofit that was looking for the cheapest possible [UC platform]."

Enterprises no longer cite security as a main concern but feel Skype is simply not enterprise-ready, he said. Skype-Business Version as it stands today lacks the technical support, feature set, reliability and integration with legacy systems that enterprises have come to expect from traditional UC vendors, Lazar said. Making those changes would likely require Skype to raise its rates, however, and lose much of its appeal, he said.

Skype-Business Version 'complementary' today, replacing PBX tomorrow?

For ePromos.com, an online retailer, Skype-Business Version has become one of the most reliable IT services it supports. David Wagner, infrastructure manager at ePromos, said he deployed Skype after remote employees continued to be plagued by poor call quality and dropped calls with his existing VoIP infrastructure. He also purchased VoSKY, a gateway to connect legacy phone systems to Skype. Other products would have required ePromos to rip and replace its telephony systems, Wagner said.
The use of Skype for business communications spread virally at ePromos. More users wanted to switch to Skype and soon requests flooded in for IT to support Skype plug-ins for Web browsers, IM, video conferencing and mobile clients.

Remote employees receive inbound calls via ePromos'  general toll-free number or directly through a Skype number. They use the client for both Skype-to-Skype and traditional outbound calling; most in-office users use Skype only for Skype-to-Skype calls, Wagner said.

"Right now it's complementary [to our legacy systems], but as time goes on and we find more and more uses for, it I would not be surprised if there comes a day [when] we say, 'How can we completely replace our PBX?'" he said.

Wagner supports Skype with two standard broadband connections -- one wired and one WiMAX. Users have had few complaints about quality and reliability with Skype-Business Version, he said, describing call quality as "incredible."

"I have more outages on our own network with little odds and ends here than I've had with Skype," Wagner said. "Something like [Skype's recent outage] doesn’t faze me. [It would] if this was recurring and happened a lot and was impacting our ability to do business, but [the late December outage] is the first [we experienced] since we implemented it."

Like other IT managers, Wagner said he would like to see Skype improve its administrative and management capabilities and enable Active Directory syncing.

"Skype Manager was a huge step in the right direction and helps a lot with being able to administer users in the system, but there are elements that are still distinctly consumer," he said. "That part as an administrator does bother me. I can't say they don't. I really want Skype in 2011 to really, really focus on the business aspect of their products."

- TechTarget

What unbundling means for service providers and consumers

Drive around SA city streets and you’ll soon notice Telkom’s green and blue distribution cabinets, like the one pictured above near TechCentral’s offices in Johannesburg, writes Candice Jones.
Soon distribution cabinets of various colours could be popping up next to Telkom’s street boxes, thanks to local-loop unbundling. And their arrival could herald a steep reduction in fixed-line broadband costs for consumers and businesses.
Telkom’s distribution boxes, many of which now have fibre-optic cables running into them, are often the place where the company provides consumers with access to its digital subscriber lines, the broadband links over the copper cables that run into people’s homes.

The Internet market has long been anxious to see the local loop, the so-called last mile of copper cables that connects consumers and small businesses to Telkom’s network, unbundled.

This dream could be realised before the year is over, and rival operators and Internet service providers have to start thinking now about how they will gain access to this network to provide fixed-line broadband directly to consumers.

Worldwide, local-loop unbundling has boosted competition among Internet providers, driving down prices and paving the way for new services.

Greg Massel, CEO of alternative operator Switch Telecom, says one of the requirements is that Telkom allows competitors to “co-locate” telecommunications equipment in Telkom’s exchanges – and, closer to homes, in distribution cabinets — so they can gain direct access and provide onward connectivity over their own backhaul links.

Getting the equipment into these facilities is a big exercise, even if Internet service providers only want to serve niche areas rather than offering broadband services nationally.

“Costs will vary depending on the coverage area, the equipment used and the capacity deployed, but I think it’s safe to say the kind of investment required will limit the direct benefits of unbundling to larger service providers,” says Massel.

But he says smaller service providers will have more options when looking for alternative wholesale suppliers, which may help drive down prices.

For many local Internet providers, backhaul will be a key consideration. Web Africa CEO Matthew Tagg says getting fibre to Telkom’s facilities will be the biggest factor influencing how successful unbundling will be.
However, Tagg says alternative fibre network suppliers like Dark Fibre Africa have begun providing backhaul links, which should help keep prices down.

The process becomes complicated in areas where Telkom doesn’t provide broadband access over copper from its traditional telephone exchanges, but rather from the distribution cabinets along city streets.
In recent years, Telkom has actively laid fibre closer to people’s homes, running into distribution cabinets, and shortening the distance between consumers and high-speed fibre backhaul. Shortening the local loop in this way has allowed Telkom to offer higher-speed broadband, up to 10Mbit/s in some areas that are served by Metro Ethernet technology.

But it also means Internet service providers have to start thinking about deploying their equipment in those boxes, or even building their own, says Tagg. The problem is there isn’t much space in Telkom’s cabinets, so alternative providers will have to consider building their own cabinets nearby.

There have been suggestions that Telkom could offer what is called “bit-stream unbundling”, where it provides all the equipment other service providers need to connect customers. In this scenario, service providers won’t need to provide their own facilities in the exchanges or build their own distribution cabinets.
“The industry should have had bit-stream access from when Telkom first introduced digital subscriber lines,” says Tagg.

MWeb CEO Rudi Jansen

He says to propose bit-stream access as an alternative to full unbundling is “a big cop-out”. “It will do very little to drive competition or produce real change for customers.”

Tagg says full unbundling has been “very successful in Commonwealth countries such as Australia and New Zealand”. Increases in speeds and broadband quality in those countries can be directly attributed to the increase in competition brought on by unbundling.

“We are already playing catch-up with countries like Australia. By my estimation we about seven or eight years behind,” says Tagg.

Though smaller operators are looking forward to unbundling, larger players are wary of committing themselves to exactly what will be needed to take advantage of the process.

MWeb CEO Rudi Jansen says what will be required will depend to a large extent on what the regulator, the Independent Communications Authority of SA (Icasa), stipulates must be unbundled.

The authority last week revealed, in an exclusive interview with TechCentral, that it hopes facilities-leasing regulations will be enough to force Telkom to provide competing operators access to the local loop.
In terms of the Electronic Communications Act, the local loop is considered an “essential facility” since it is a key aspect of the telecoms environment and operators are now able to demand access from Telkom.
However, Jansen says facilities leasing is only a portion of unbundling and will only take the process so far.
“At the end of the day we are all in the hands of what Icasa decides and how much Telkom would like to open up and under what conditions it will allow us into their facilities,” he says.

“We need naked digital subscriber lines, where telephone and broadband line rental is split and not a situation where one is conditional on the other,” Jansen says. “More exchanges need to be upgraded to be broadband-capable and investments need to be made in access speeds,” he says.

Internet Solutions MD Derek Wilcocks

However, he says Icasa is not entirely on the wrong track. “For now, I think the regulator must go for the easy wins that will give immediate benefits to all.”

Internet Solutions MD Derek Wilcocks says the best bet for local-loop unbundling is for the country to impose on Telkom what UK regulator imposed on Britain’s incumbent fixed-line operator, BT Group.
BT spun off its local loop into a separate, independent company called Openreach, which manages, maintains upgrades and leases the local loop to competing operators, including BT itself, and does it in a way that is transparent to all market players.

“Creating a wholesale, transparent spin-off would be the most practical short-term solution for getting things done,” says Wilcocks.

However, he says Telkom is preparing new products that indicate it is taking unbundling seriously. “For example, it is offering aggregated capacity at the larger exchanges to competing providers, instead of charging for every circuit in that exchange.”

Whether Internet service providers will gain access to the local loop this year remains unclear. However, most industry players are hoping Telkom will meet the November deadline set by communications minister Roy Padayachie.

- TechCentral

Research and Markets: South Africa - Telecoms, Mobile, Broadband and Forecasts 2011

(M2 PressWIRE Via Acquire Media NewsEdge) RDATE:07012011 Dublin - Research and Markets (http://www.researchandmarkets.com/research/8ca47e/south_africa_tel) has announced the addition of the "South Africa - Telecoms, Mobile, Broadband and Forecasts" report to their offering.

This annual report provides a comprehensive overview of trends and developments in South Africas telecommunications market. Subjects covered include: - Key statistics; - Market and industry overviews; - Government policies affecting the telecoms industry; - Market liberalisation and regulatory environment; - Major players (fixed, mobile and broadband); - Telecoms operators privatisation, acquisitions, new licences; - Infrastructure development; - National and municipal fibre rollouts; - International submarine fibre optic cables; - Mobile voice and data markets, including 3G and 4G; - Internet development; - Broadband, including 3G mobile; - Broadband pricing, fixed and mobile; - Average Revenue per User and churn; - Internet and broadband development and growth; - Broadband and mobile data services and pricing trends; - Convergence (voice/data, fixed/wireless/mobile); - Electronic banking and m-banking services; - Digital Media.

The continents leading telecoms and digital media market: South Africas telecom sector boasts the continents most advanced networks in terms of technology deployed and services provided. In a virtually saturated voice market, four mobile networks Vodacom, MTN, Cell C and Telkom SA are competing for market share in the next growth wave, mobile broadband. 3G/HSPA mobile broadband services now rival available DSL fixed-line offerings in terms of both speed and price, and consequently subscriber numbers. 2010 also saw the first trials of the next generation of mobile technology, LTE (also referred to as 4G) in South Africa.

While emerging as the countrys leading broadband providers, the major mobile operators are also branching out into fixed-lines, fibre backbone networks, international fibre connectivity, mobile banking and entertainment in a rapidly converging environment. Fixed-line incumbent Telkom SA has reacted by launching its own 3G mobile network and the countrys first commercial WiMAX service, but various competitors are hard on its heels rolling out the same technology, including second national operator Neotel.

Following years of delays with its licensing, Neotel is gaining traction in the market in competition with Telkom. This, in combination with other sweeping liberalisation measures, also delayed by years, has changed the countrys telecoms landscape fundamentally and brought prices down. In addition, the government has created Broadband InfraCo, a national infrastructure company to provide cheap backbone network capacity to service providers. Despite the significantly increased competition between different service providers, many municipalities in South Africa, including the countrys largest cities, are implementing their own fibre and wireless broadband networks.

Under a converging regulatory regime, hundreds of alternative service providers are now pushing into the market with converged services. The legalisation of VoIP Internet telephony in 2005 marked the beginning of a fundamental change in the countrys telecoms landscape. Billions of dollars are being invested into IP-based next-generation networks that are capable of delivering converged services more efficiently. Telecom carriers and ISPs are moving into delivering audio and video content over their networks, while in turn the traditional electronic media carriers have discovered the potential of their infrastructure for telecommunications service delivery.

Key regulatory events shaping the market in 2011 will be the complete unbundling of the local loop, the staged reduction of interconnect charges, the auctioning of WiMAX and LTE spectrum, and a deadline for mobile subscribers to register their personal details with service providers under new legislation, which could lead to a significant drop in mobile penetration.

All of the major players are involved in the various international submarine fibre optic cables that have reached the country in the past two years. Following the end of Telkoms monopoly on international submarine fibre-optic cables, the arrival of Seacom as the second international cable in 2009 has brought down the cost of international bandwidth dramatically. A third international cable, EASSy landed in 2010, and more are scheduled to go live in 2011 and 2012.

South Africas Internet and broadband market has finally taken off after years of stagnation due to an expensive operating environment created by Telkom SAs dominance in the fixed-line and international bandwidth market. The new converged licensing regime has created hundreds of companies licensed to offer Internet services. There has been consolidation in the sector which is expected to continue.

With its relatively well-developed and diverse infrastructure, South Africa is also taking a regional lead role in the convergence of telecommunication and information technologies with the media and entertainment sector, promising reductions in telecommunication costs and better availability of information and services. Digital media and social media have reached a level of development to foster an associated advertising and marketing industry. The FIFA World Cup held in the country in 2010 has showcased these developments. While South Africa lags behind other countries on the continent in the development of e-government, e-health and e-learning applications, it is a regional leader in the areas of electronic banking and mobile banking services.

Market highlights: - Forecasts to 2012 and 2015 for the mobile, Internet and broadband market; - Profiles of major players in all market sectors; - 2010 financial results; - Mobile penetration is back below 100%, new legislation in 2011 could lead to further drop; - New regulations for staged reduction of interconnect charges 2011-2013; - 3G mobile broadband surging ahead of DSL; - First LTE trials in Africa; - WiMAX and LTE spectrum auctions postponed to 2011; - Local loop unbundling to be completed in 2011; - Third major international fibre link landed, more planned in 2011/12; - FIFA World Cup 2010 has boosted digital media developments; - Leading market in the region for electronic banking and mobile banking services.

Data in this report is the latest available at the time of preparation and may not be for the current year.

Key Topics Covered: 1. Key Statistics 2. Telecommunications Market 3. Regulatory Environment 4. Fixed Network Market 5. Telecommunications Infrastructure 6. Internet Market 7. Broadband Market 8. Digital Media / Digital Economy 9. Mobile Communications 10. Forecasts 11. Glossary of Abbreviations For more information visit http://www.researchandmarkets.com/research/8ca47e/south_africa_tel ((M2 Communications disclaims all liability for information provided within M2 PressWIRE. Data supplied by named party/parties. Further information on M2 PressWIRE can be obtained at http://www.presswire.net on the world wide web. Inquiries to info@m2.com)).