Less than 30 days since it closed its US$915 million acquisition of the enterprise solutions business of Nortel Networks, Avaya Inc. on Tuesday announced its roadmap for integrating the Nortel portfolio into Avaya’s going-forward.
In what executives from Avaya are calling a blending of the best of both companies, a number of Nortel technologies and offerings will be integrated into Avaya’s, some playing key roles. For partners, perhaps the most notable changes occur on the services side, where Avaya is implementing an annuity model it described as more “industry-standard.” Warranties will move from 12 months to three months, and Nortel partners will be onboarded into the new Avaya Connect partner program beginning in April.
The tech road-map explained
“We definitely overlap in a number of areas but we found we have strengths in different components and we’ve been able to bring those strengths together to accelerate our growth,” said Alan Baratz, senior vice president and president for Global Communication Solutions at Avaya, in a conference call with press and analysts.
Adding an essential SIP layer into the communications hierarchy will be accomplished via Avaya Aura, the company’s SIP-based communication software platform that will be sandwiched between communications infrastructure – such as PBXs – and services – such as voice, video, messaging, conferencing and mobility.
With Aura in place, legacy Avaya and Nortel PBXs will interoperate with SIP-based VoIP gear. So Nortel Communication Server 1000 IP PBX with Aura layered on top of it could interface with SIP-based phones plugged into the Aura side of the network. Legacy Nortel phones could be plugged into the Aura side of the network.
In the area of contact centers, Avaya has decided that Nortel’s Contact Center will be integrated into the product line in lieu of Avaya’s. Over the next six to nine months, revisions of Nortel’s Contact Center will prepare it to become the Avaya offering for midsize businesses rather than Contact Center Express.
The contact center software from Nortel will be further developed to incorporate all of the architectural features Avaya envisions for contact centers, then further developed so it can scale to enterprise proportions. These two revisions will take six to nine months each. At that point the software will become an upgrade to replace Avaya’s high-end Contact Center Elite.
Avaya plans to slowly reduce the number of telephony options available for small and midsize enterprises. It plans to bring legacy Avaya Partner and Integral 5 key systems as well as Nortel Norstar systems under the umbrella of its IP Office gear.
Services and the channel
During the conference call, Todd Abbott, senior vice-president of sales and president of field operations for Avaya, stressed the steps Avaya has taken in recent years to move to a more channel-centric model. The centerpiece of the new approach is a new global partner program, Avaya Connect, which will formally launch in February and begin integrating Nortel partners in April.
Most of the changes that Nortel partners will be facing with Avaya will likely be centering around services. Warranties on software will move from 12 months to three months. As well, level four services will move to annuity-based contract model that a partner can either resell for Avaya or offer itself as a managed services provider.
It’s a change to what Abbott called a more “industry-standard” approach to services, calming Nortel’s previous model just wasn’t sustainable, costing the company money on each contract. Indeed, Abbott said Nortel’s services model was one of the factors that contributed to its bankruptcy. Avaya will honour existing contracts signed under the old model, but going forward Abbott said partners will need to factor the new costs into contracts and bids, whether its bundled into the contract or resold separately.
“Nortel lost money on every one. It was a significant profit drain on the business,” said Abbott. “The way I look at these changes is they’re all industry-standard. It’s a way to get us to a sustainable model.”
Dave Sherry, president of Newmarket, Ont.-based IP communications solutions provider Unity Telecom, an Avaya and Nortel partner, said Nortel never charged for services before, a model that made more sense when hardware upgrades and changes were less frequent. Avaya partners moved to the annuity model some years ago and have been conditioned to work support costs into contracts and doing business. It will be an adjustment for Nortel partners, but Sherry said the aftermarket revenue funds research and development that will benefit customers.
“Customers are getting more, it might cost them a little more, but they’re getting new features and upgrades as well,” said Sherry.
On the roadmap, Sherry’s Nortel business is on the SMB side and he’s pleased with the continued support for many Nortel offerings including Nortel SCS, which he calls a very cool product with some unique features. He’s also pleased with the recently added ability for IP Office to also support existing partner equipment.
Sherry added the warranty length changes bring Nortel more in line with the rest of the market, as Nortel had lengthy warranties on some products in the early days to try to gain share from competitive equipment.
Janet Waxman, vice-president of infrastructure channels and alliances with research firm IDC, said with the roadmap release Avaya is on the right track, and has shown it is serious about moving to be a more indirect company.
“They’ve really made some great announcements round services for the channel. Nortel was far more indirect, they’ve acknowledged that and they’re learning from it,” said Waxman. “It’s hard for partners to make the transition to a new vendor, but I think Avaya is very much welcoming them with open arms, and that’s compelling to Avaya.
While Avaya is trying to make the transition as smooth as possible, only time will tell how successful they’ve been. Waxman said Avaya has moved quickly to get the new roadmap out and bring Nortel partners into the fold.
— With files from Network World (US)