Microsoft Office 365 is considerably less expensive than a comparable bundle of cloud-based unified communications...
By submitting your personal information, you agree that TechTarget and its partners may contact you regarding relevant content, products and special offers.
and collaboration applications from Cisco. But a close examination of the two leading UCC suppliers shows that enterprises should weigh more than price when comparing the vendors' products.
Brent Kelly, an analyst at KelCor Inc., based in North Logan, Utah, broke down pricing and features for the providers' cloud communications bundles during a session at last week's Interop trade show in Las Vegas. Cisco and Microsoft dominate the UCC market for companies with more than 2,500 users, according to Nemertes Research.
While Microsoft is less expensive, its architecture is a lot different than Cisco's. Microsoft's approach is a merger of its Office productivity suite and UCC applications. Cisco, on the other hand, builds its UCC platform on top of its data networking gear and software.
"It's really a different kind of mindset," Kelly said of the two vendors' cloud communications platforms.
Competition between Cisco and Microsoft is fierce. Almost half of large enterprises surveyed by Nemertes use a single UC vendor or plan to use only one by the end of 2016. Of that group, 53% were in Microsoft's camp and 35% favored Cisco.
Which platform enterprises should choose depends on their needs, Kelly said. Companies that want Cisco UC tools and its Spark collaboration application often have Cisco video conferencing and Google Apps for office productivity. Also, they have a large and complex telephone system.
Businesses that pick Office 365, which includes Skype for Business and other UCC tools, typically use Polycom for video conferencing, Kelly said. They also have a large number of office workers and are replacing a legacy phone system with Microsoft.
Microsoft telephony immature
An IT architect attending the Interop session said his employer, a large manufacturing company, had thousands of workers using Office 365. But despite that investment, the company wasn't ready to dump Cisco's on-premises telephone system for Microsoft's less mature Skype for Business.
"The reality is I've got a multibillion-dollar company that's been using Cisco for our telephony infrastructure for a long time," said the IT architect who preferred to remain anonymous. "I've got a good investment there. I've got a good partnership there."
Nevertheless, Microsoft's low pricing of Office 365 and its telephony features continue to hold the interest of enterprises. The vendor's top-of-the-line enterprise bundle for cloud communications, which includes domestic and international calling and the Office productivity suite, costs $47 per user, per month, according to Kelly.
Cisco is known to offer discounts as much as 60% for on-premises UC products, Kelly said. The vendor, however, won't be nearly as generous with its cloud communications products.
"Cisco has said they are not discounting this at nearly the same extent," Kelly said.
Microsoft has less expensive bundles that let small businesses add access to the public telephone system for an additional $12 a month for U.S. calls and $24 a month for international calling. Each user gets a maximum of 2,000 minutes a month, Kelly said. "If you're a small business, this is an awesome offering."
In the small and medium-sized business market, Microsoft competes with many more vendors than Cisco, said Irwin Lazar, an analyst at Nemertes Research in Mokena, Ill. Competitors include large vendors Mitel Networks, NEC and ShoreTel, along with pure cloud-based telephony providers, such as RingCentral, 8x8 and Vonage.
The future of UCC applications
Market drivers behind UCC adoption
How real-time collaboration is changing communications