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Cost-cutting key to keeping unified communications in slow economy

Michael Morisy

In a slumping economy, companies are reviewing the cost analysis of their unified communications projects. They are focusing on projects that save them money rather than those that deliver less tangible gains such as improved productivity.

Luc Roy, vice president of enterprise mobility at Siemens Communications, said he has already noticed the trend when he goes on sales calls to pitch unified communications products.

"The customer engagements we have had recently have been about, 'How can you save me money?'" Roy said. Previously, they had been focused on boosting productivity.

Roy said

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cost savings are easy to find. Fixed-mobile convergence can cut cellular costs and telepresence helps reduce travel expenses.

Many organizations are focusing on unified messaging, particularly with devices that combine email, voicemail and text messaging like the BlackBerry, according to David Lemelin, a senior analyst at In-Stat. Many of these applications or devices have been in the enterprise for years but are now working their way to midmarket businesses.

More advanced, capital-intensive projects might see a different fate.

"By the time you start looking at things like video conferencing and telepresence, which can be a major expenditure, that definitely is something that companies are … reconsidering now," he said.

Even having a clear cost analysis of how these advanced technologies can help the bottom line might not be enough to save them.

"When we talk to or survey IT managers and decision makers, they tend to understand the productivity gains and efficiencies," Lemelin said. "Employees, on the other hand, don't necessarily want some of the capabilities, particularly when you get to presence and being available 24 hours a day, seven days a week."

Without employee buy-in or understanding, companies are unlikely to realize the full value of these unified communications projects.

Still, not everyone is counting on creative unified communications to save their bottom line.

"We did a survey in June, prior to what's happened in the past week or two, when already there were signs of a slowing economy," Lemelin said. "What we found was a third of businesses said it hadn't impacted their [UC] planning at all. Twenty percent said it had slowed their deployment, and only 4% had said it would speed up their deployment."

Lemelin said 13% of respondents were now considering options with fewer up-front capital expenditures, such as hosted or managed solutions, including Web-based offerings.

For many companies however, with the full economic impact still uncertain and their fiscal years winding down, the real questions are still a few months away from being answered.

"Right now we're not seeing any impact yet. We're in the tail end of the year, everyone's made their budgets and they're just executing on bills," said Sara Radicati, president and CEO of The Radicati Group Inc. "I think that every company will do a hard reassessment of all of their IT projects and spending going forward."

Radicati also said there was no particular reason unified communications would be singled out among IT projects for the cutting board.

"You have to look at in the context of all the IT projects they have," she said. For some companies, an upgrade to UC might be relatively trivial rather than an overhaul.

"Maybe their existing PBX system has come to the end of life, and that's a good time to upgrade," she said. "There is no particular reason one would pick on UC as the first thing to slash."


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