As enterprises begin to ditch the desk phone, traditional hardware-based unified communications licensing models are becoming antiquated, and UC vendors are tweaking their licensing models. As mobility and flexibility move to the forefront of enterprise UC strategies, those models now include software options.
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Cisco UC licensing -- which typically used a a hardware-centric model -- recently underwent an overhaul to include multiple endpoints and software-only licensing options. But while enterprises want vendor licensing to keep up with the evolving UC experience, more options can translate into more complicated licensing models.
Other UC vendors – such as Microsoft, IBM and Avaya Inc. – were already offering software-centric UC licensing options, so moving into application-based communications offerings was a critical move for Cisco, noted Bill Haskins, senior analyst for Wainhouse Research LLC.
"UC licensing is inherently confusing, and as enterprises have more [UC endpoints], users need fewer, more straightforward licensing options," Haskins said. "I think Cisco is ultimately going in the right direction, but there is a long way to go."
"As we look to what customers need and want, we have decoupled the hard phone from software UC options and now offer totally software-oriented UC models," said Richard McLeod, senior director of worldwide partner collaboration sales for Cisco.
Cisco UC licensing targets emerging user needs
The Cisco UC licensing announcement is geared to three classifications of enterprise users: the office worker, information worker and power user. Cisco recognizes that collaboration tools are multiplying as the workspace is changing, Roberto De La Mora, Cisco senior director of UC platforms and endpoints noted in a blog post.
"Some employees still do the bulk of their work from behind a desk at company headquarters; others split their time between the office and more on-the-go locales; still others need 'full mobility' with access to … software collaboration offerings so work can happen in coffee shops, airplanes [and] hotel rooms," De La Mora wrote.
The three new Cisco UC licensing options offer flexibility to these different kinds of users. With a Standard, or office-worker license, users can select a single or dual-device license that works with any hardware- or software-based endpoint. Enhanced and Enhanced+ information-worker licenses can apply to the multiple devices that workers use regularly and include Cisco's Unity Connection unified messaging technology. The Professional, or power-user license offers multiple device options and real-time collaboration technology: Cisco's WebEx Social and WebEx conferencing.
The newly-revamped Cisco UC licensing bundles are more role-based, and less like the "Chinese menu" of á la carte UC licensing options, Cisco's McLeod said.
Cisco UC licensing: Enterprises need visibility
The Cisco UC licensing bundles also include the company's Enterprise License Manager, software that McLeod said can help channel partners manage the licensing process for their customers more easily, and grant enterprises more visibility into their licensing use.
The company's proprietary licensing manager technology released in 2010 -- Cisco Unified Workspace Licensing, or CUWL -- was meant to improve the packaging of UC applications and simplify the ordering process, but enterprises were still running into issues around tracking licenses and determining when licenses expired and how many were active or not yet provisioned, noted Rob Arnold, senior industry analyst at San Antonio-based Frost & Sullivan Inc. "Enterprises need to be able to utilize their UC licenses most efficiently," he said.
Vendors who can provide a transparent UC licensing model are more appealing to enterprises, Wainhouse's Haskins said. "There's a lot of money being made in the UC market in unused licenses," Haskins said. "Giving enterprises eyes into what's being licensed and what's being used -- what they can get rid of and not pay for -- is a great move made possible by this software-based UC conversation."
The transition from a traditional, hardware-based UC licensing model to a software-based model might be the most tumultuous for Cisco channel partners, who now must retool their UC sales strategies, Haskins said, noting that UC channel partners will have to evolve along with the vendors.
Enterprises will have to embrace the new licensing model as well. "Enterprises need to understand what their new options are, and there will be some pain points associated with the change," Haskins noted. "I expect over time, [Cisco] will be better able to distill its UC licensing options into a more manageable conversation for the enterprise," he said.