There's another conference I should be at and am not - VoiceCon. This one story caught my attention and I feel like I need to share and comment.

VoiceCon: Avaya CEO says VoIP may not lower costs
Instead, better business operations should drive rollouts, says Don Peterson
News Story by Matt Hamblen

MARCH 08, 2006 (COMPUTERWORLD) - ORLANDO -- Avaya Inc. CEO Don Peterson surprised some IT managers at VoiceCon Spring 2006 today by declaring that they should not deploy IP telephony expecting to lower communications costs. Instead, they should look at it as a way to improve business operations.

Peterson’s comments, delivered in a keynote address to most of the 5,000 conference attendees, stood in stark contrast to several presentations from representatives of businesses well on the way to outfitting their companies with new networks, phones and applications based on IP who said they’ve already saved money.

Some of those IT managers have reported millions of dollars in annual savings, thanks to reductions in long-distance call costs and a decrease in the amount of work for IT staffers who have to add or move phones. Other savings resulted from deploying only one data line to a desktop without the need for a separate costly voice cable.

“We don’t believe IP telephony is a cost-reduction case,” Peterson said in his speech. “I fundamentally believe that the real value is not cost reduction, but how it changes the business.”

First I want to share something from my past. As some of you know I once worked for AT&T, then Lucent Technologies. Prior to the spinoff of Lucent, I worked in a variety of different rolls in AT&T over several years. I was a sales engineer, account manager and sales manager for AT&T/Lucent during the closing years of my tenure. I was pretty good at it, and I'm going to share my approach to customers with you. I'm extending it to Avaya simply by inference, since a portion of Lucent became Avaya, and those G3R systems they're selling today at the higher end aren't all that different than the G3Rs I designed and sold then.

I approached customers in a very straightforward manner, and told them, in some cases quite directly (to the chagrin of those higher up the food chain than I) that what I'm going to present to you is going to be the most expensive solution in the market. If you're looking for the cheapest, let's not waste your time or mine. If you're looking for value, I'm going to present the best value you'll find. But value isn't cheap.

I never looked for the quick sale. I never sold on the cheap to meet someone's bottom line budget. And yes, I missed some sales. But on the flip side, I've got relationships with former customers that go back 20 years. And I've never sold them another thing. Probably never will. But they listen to me and ask my advice. And if I had a solution to sell and thought it would fit, I know they'd invite me in to talk about it.

Don Peterson took a hard stand openly and fairly, in a market where vendors will often FUD you into a sale. That's right, fear, uncertainty and doubt can be used as tools. To his credit, Peterson told it like it is. And he made a key point that cannot be overlooked.

I've followed VoIP closely from the beginning. I've taught the protocols and technologies. I've watched it evolve. I've seen a lot of wrong guesses about what would drive VoIP to success. Even made a few. At one point, VoIP was going to be the long distance killer that drove those carriers down by pricing them out of the market. Didn't happen. Cellular did that with unlimited minutes plans that are dirt cheap. VoIP was going to dominate international long distance driving down the cost there. That unfolded slowly and in moderation. Not all countries regulate telecommunications the same way. In some countries the telecom provider is the government. They don't have a  very strong incentive to kill their own business. So in some cases they made laws to prevent it. The made VoIP illegal.

Even today, the carriers do everything they can to place obstacles in the path of VoIP success, while touting their own version of what VoIP is and will be. Verizon, for example, talks a really good game. But if you're a Verizon Wireless Broadband customer, don't use VoIP on your broadnand device. It violates the terms and conditions of your agreement. I wrote a bit about this on my personal blog here. It points in an example of a traditional telco positioning as a VoIP supporter on the one hand, while undermining the disruptive competitive technology with the other. That is the legacy of the traditional telecommunications industry.

But VoIP remains a disruptive and converging source of technology. It will disrupt how applications integrate with one another. It will disrupt preconceived notions of convergence. It will break old communications pardigms, especially as peer-to-peer technologies become acceptable business tools rather than the dirty little secret file sharing untility stigma they're saddled with today. Peterson can afford to be honest for a couple of reasons. Avaya's solutions are very good. In a competitive market, it's good to have a good product.. And hardware providers will always have an advantage. They sell tangible products that can be touched, felt and most importantly tested. They're outside that soft telco service sector that wants you to believe what you're buying is "value added services."

The root value in VoIP, the core essence isn't cost savings. It isn't cheap long distance. It isn't converging networks. It isn't coverging the desktop to a single device. It isn't even the impending disruption as VoIP integrates applications and web services. The value in VoIP is the disruption and reshaping it will do to your business. Today, tomorrow, next year. Your business will feel the impact of VoIP.

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