Sanity check: Will Microsoft be your next phone company?

On October 16, Bill Gates proclaimed that the business phone has been stuck in a time warp and that the moment has arrived to bring it into the digital age and revolutionize business communications in the process. This edition of Tech Sanity Check examines Microsoft's broad ambitions in unified communications and how it could impact IT.

Bill Gates has had a very interesting track record in the prediction business over the past three decades, and now he's making a new prediction: The business phone as we know it will be replaced by software that will unleash a higher level of collaboration and productivity.

In the 1980s, Gates articulated his vision of a "PC on every desk and in every home" that has become the foundation of the modern IT industry. During the 1990s, he predicted that e-mail would become indispensable, that consumers would eventually be able to time-shift their TV shows, and that users and advertisers would migrate en mass from print publications to Web sites.

On the other hand, in 1987 he predicted: "OS/2 is destined to be the most important operating system, and possibly program, of all time." In 2004, he predicted that SPAM would be solved within two years. He has also made bold predictions about the rise of tablet PCs, voice-recognition software, and digital wallets, but none of those technologies has become a mass market phenomenon -- at least not yet.

Gates's latest prophesies came on October 16 at Microsoft's Unified Communications Launch 2007 event (view photo gallery) in San Francisco , where Microsoft revealed the full breadth of its products and plans for business telephony and unified communications. "In the next decade, sweeping technology innovations driven by the power of software will transform communications," Gates said. "Working with partners, we're making rapid advances that will enable fundamental advances in the way people communicate and collaborate at work."

Gates further explained that Microsoft's newly launched unified communications platform "... is about taking the magic of software and applying it to phone calls. We don't just say phone calls because, of course, once you get software in the mix, the capabilities go way beyond what anybody thinks of today when we think of phone calls."

So the question is whether this latest prognostication will be another clarion call for the IT industry the way the "PC on every desk" prediction was, or if it will be a false prophesy like the OS/2 statement was, or if it will simply be an idea ahead of its time the way the forecasts about tablet computing and voice recognition have been.

The Gates vision of the business phone

If you want to know how significant Bill Gates thinks Microsoft's unified communications platform is going to be, take a look at the lofty comparisons he made during his keynote on October 16:

  • He compared the PBX to the mainframe, and unified communications to the PC.
  • He compared the transition to software-based voice communications to the transition to computer-based word processing from the typewriter.
  • He compared the move to unified communications to the move to a graphical user interface from a command-line interface.

Bill Gates points to the new Microsoft Roundtable device during his keynote presentation at Microsoft's Unified Communications Launch 2007 event in San Francisco. View the entire photo gallery.

"This is a complete transformation of the business of the traditional PBX," Gates said. "The PBX in some ways is almost like the mainframe was many years ago where all of the functionality was there in that one piece. And the way that you had ... to add value, to customize, to bring in third parties to do new things, it just isn't there in that structure. And so by moving phone calls onto the Internet, using the powerful industry standard servers, we've got a very different way of being able to do things. And that can lead not only to lower cost, but far more effectiveness in how your employees work within your company, or with customers and partners outside your company."

Gates may not have much experience in the PBX and phone world, but he has had a ton of experience with the next transition he mentioned. He said, "So this transformation to software-based communications is going to be as profound as the shift from typewriters to word processing software. Moving from a dedicated piece of hardware to the general purpose, personal computer that happened over 20 years ago, and now we simply just take that for granted. Even 10 years from now, when people think about telephony ... if you see in a movie that old desktop phone you'll think, 'Oh yeah, we used to have things that looked like that!'"

Finally, Gates mentioned one of the prominent tech transitions he will always be associated with. "I think [unified communications] will be a lot like the revolution that took place with graphic user interface, where at first some people didn't participate [because] some people didn't know that [GUI] was going to be the mainstream. [Eventually, unified communications] will become something that's so pervasive it will just be expected."

Jeff Raikes, president of the Microsoft Business Division, added another comparison during his speech at the UC launch event. He said, "Unified communications software will transform business communications as fundamentally as e-mail did in the 1990s. Today, Microsoft is in the VoIP game, and our customers and partners are already winning with better economics and new business opportunities... We're delivering revolutionary economics in VOIP, and increased productivity and quality in voice communications."

Gates and Microsoft are so invested in unified communications because they believe that it will solve several common problems and unlock new capabilities in business communications, including:

  • Make it faster and easier to find contact information for co-workers and business partners
  • Use presence and calendaring to find the appropriate times and ways to connect to co-workers and business partners
  • Reduce the amount of time it takes to schedule meetings, wait on hold, play phone tag, etc.
  • Increase the IT manageability and security of instant messaging
  • Simplify video calling
  • Simplify the setup of audio and video conferencing
  • Make it easier to deploy voice communications for new users and to change/move current users
  • Open the door to Communications-Enabled Business Processes (CEBP), which can use events from business systems (reports, databases, monitoring programs, GPS systems, cameras, etc.) to automatically trigger alert messages to the appropriate worker(s).
  • Enable fixed-mobile convergence so that cell phones and smart phones can be equipped with software applets that allow them to become an extension of the business communications network

Microsoft's new unified communications (UC) platform

Microsoft's vision of unified communications is delivered in a modular, extensible platform that can integrate with a variety of different platforms, but as you'd expect, it works best (and requires the least amount of capital investment) if you already have Microsoft infrastructure in place in your organization. For example, if you already have Windows Server 2003 and Microsoft Office 2007 in place, the path to Microsoft's UC platform requires a relatively short leap.

Here are the key components of the platform:

  1. Office Communicator 2007 --This is the client application that brings together voice dialing/calling, instant messaging, presence, audio conferencing, video conferencing, document sharing, and integration with Microsoft Outlook, Microsoft Office, and other applications that develop plug-ins. There are also versions of Communicator for the Web and mobile phones.
  2. Office Communications Server 2007 -- OCS is the backend server application that ties all of this together and provides the VoIP, video, audio, and communications framework to make the platform work. It runs only on Windows servers and it also requires SQL Server.
  3. Office LiveMeeting 2007 -- Like previous versions of LiveMeeting, this software enables audio and video conferencing, online meetings, PowerPoint sharing, document sharing, and whiteboarding. The latest version integrates with Communicator 2007 and OCS 2007.
  4. Microsoft Roundtable -- While most of what Microsoft is doing involves software, Roundtable is a Microsoft hardware device that brings innovation to video conferencing by sitting in the middle of a conference table and providing a 360-degree panoramic view of everyone in the meeting. At a price point of $3,000 and software integration with Communicator 2007, Roundtable is meant to improve and simplify video conferencing to bring it to the masses.
  5. Exchange 2007, Service Pack 1 -- The new service pack for Exchange 2007 includes a variety of the usual kinds of updates and improvements, but the most significant change is integration with OCS 2007. This includes some nice additions such as "Conversation History," which allows you to call up an instant messaging thread from Communicator in Microsoft Outlook.
  6. An ecosystem of hardware and software partners -- On launch day, more than 50 hardware and software partners announced new products aimed at integrating with Microsoft's UC platform. These partners make everything from desk phones and handsets that interoperate with Communicator 2007 to software plug-ins that take advantage of the presence and communications capabilities of OCS. Since of the prominent partners include Nortel, Ericcson, Motorola, Mitel, Polycom, Tandberg, SAP, BT, NEC, LG, Dell, HP, Palm, and Samsung.

The most original piece of Microsoft's UC platform is its Roundtable conferencing camera, which includes multiple cameras and microphones and uses software to automatically track who's speaking. View the entire photo gallery.

The Roundtable camera presents a complete view of everyone in a meeting as you can see at the bottom of this Communicator 2007 screen, which also includes a shared PowerPoint slide. View the entire photo gallery.

The standard Office Communicator 2007 window shows advanced presence information. View the entire photo gallery.

For offices that aren't ready to abandon the standard business phone form factor, companies such as Nortel are developing desk phones that use Microsoft's UC platform to present presence and contact data on the phone's display. View the entire photo gallery.

Sanity check

Normally, when you introduce a new platform that will change the way many users interact with their PCs, you can expect slow adoption from IT departments and businesses, as Microsoft has seen with its Tablet PC. However, I think two factors could speed the adoption of Microsoft's UC platform:

  1. VoIP -- Thousands of companies have been engaged in VoIP deployments over the past three years. One of the original motivators was cost savings, but there was also the promise of improved efficiency and collaboration. Unified communications can unlock the potential of VoIP's efficiency and collaboration improvements. For the companies that have recently finished or will soon finish a big VoIP deployment, layering on a unified communications deployment could be an easy sell, especially for the many companies that already have Windows Server 2003, Exchange, and Microsoft Office in place.
  2. Instant messaging -- IM continues to be one of the biggest pain points for IT in 2007. While IM has become widely used by business workers, only a small handful of companies actually have an IT-sponsored IM client. The rest of the workers are using consumer services, such as Yahoo, MSN, AOL, and Skype. Using public IM clients obviously has major ramifications for privacy and security. If IT can find an easy-to-use alternative IM client that gives users standard IM functionality and still lets them connect to contacts on many of the outside services (Communicator 2007 can connect to AOL, MSN, and Yahoo), I think many of them will jump at the chance, because the stakes are getting higher all the time, especially with compliance audits putting additional pressure on IT. Microsoft's UC platform could help make the pain go away.

One final thought: Noticeably absent from Microsoft's list of partners in unified communications are IBM and Cisco. While Microsoft partners with both of them in many other ways, these two giants are building their own unified communications platforms. IBM is building an ecosystem of partners very similar to what Microsoft is doing (although even more open), while Cisco is trying to provide a high-quality end-to-end solution. Both have their strengths and are ahead of Microsoft in some areas. However, with the vast number of partners that Microsoft revealed last week and the simplified deployment path for current Windows and Office customers, Microsoft is establishing itself as a stronger player in business VoIP and UC than most of us expected.

Would you be willing to have Microsoft's unified communications platform power your business telephony? Would you prefer to simply have it interoperate with your current PBX or VoIP system? Would you prefer another UC system? Join the discussion.