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Communications as a Service – to the Cloud? March 2, 2011

Posted by TelUS Consulting Services in CLEC catagory, Data Networking catagory.

CLEC’ such as XO Communications are making a formal move into the cloud services market with the launch of its Enterprise Cloud Communications solution.

Claiming that it can simplify the management of an enterprise customer’s IP communications needs, XO says the new service can reduce the capital investments and operating costs of their enterprise-wide communications.

Delivered on a per-user pricing model, the new service integrates a number of IP telephony features, phones (Cisco and Polycom), local and long distance calling, enterprise-wide HD voice and video, network services, and IP phone sets in a communications as a service. Customers can also purchase additional network services such as Ethernet a la carte as well.

XO Communications says that there are two reasons why XO decided to move into the cloud services space: the overall size of the market and feedback from customers that are increasing moving their applications into the cloud so they can focus on their core businesses.

A report by Frost and Sullivan predicts the hosted PBX market will be $3 billion opportunity by 2015. XO is also hearing directly from their customers how they are moving applications to the cloud, extending their LAN to the WAN and how they are replacing their equipment and putting it into a virtualized environment.

Unlike traditional Centrex or on-premise PBX gear that often require upfront capital installation costs, XO’s cloud-based voice services reside in the cloud so enterprises can take advantage of new IP-based communications services.

XO is targeting customers with 50-100o seats per location. While that may not  this be a hard and fast rule, they claim to have a number of retail chain customers out there that may have 10 seats at a given location and 100-plus seats for their headquarters location.

One vertical market where XO believes the new cloud-based service could have a positive effect is in education where cash-strapped school districts could leverage an all-hosted voice solution they could replace their traditional Centrex or an on-premise PBX with a less expensive hosted solution.

Not to be left out, Global Crossing  is said to be  applying its IP networking and collaboration service experience to build its first element of its network-centric cloud solution set with the launch of its Communications as a Service (CaaS) offering.

Providing an on-demand, “pay-as-you-grow” set of capabilities that combine multiple audio conferencing services, including its well-established IP Virtual Private Network (IP VPN), Session Initiated Protocol (SIP) Trunking, and Global Crossing Ready Access hosted audio conferencing services, into a single-service, cloud-based model.

In addition, the combined capabilities support Global Crossing’s Connect Mobile, which uses a standard application programming interface (API) to give end users the ability to join or host an audio conference from popular mobile devices by clicking on an icon.

Global Crossing says its CaaS offering is a logical extension of our competency in IP networking and collaboration, and addresses the needs of today’s businesses that want to take advantage of network-centric cloud services, while reaping the benefits of a higher quality experience and more simplistic per-seat pricing model.  Global Crossing will enhance CaaS to include video, telephony and IT services, including Instant Messaging, presence and email.

While Global Crossing’s foray into cloud services is new, the fact that it is leveraging it is implementing its existing conferencing products into its CaaS offering could be attractive to both its existing customers and potentially to new customers that are considering a migration into cloud-based services to cut down on their communication expenses.

It is amazing to me how over the years we have gone from centralized mainframes to desktop computing and now finally back to centralized computing, with the added networked twist. So for all you small business’ out there I would say….to the Cloud.

Joe Buck, NCE

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