OPINION: Things to consider before buying hosted telephony software

The concept of software as a service (Saas), which has been pushed by major vendors such as Microsoft Corp. for some time, is also being touted by telephony vendors. IT managers could take some advice from research firm Frost & Sullivan, which hosted a conference call last week on unified communications and software as a service. Melanie Turek, principal analyst for unified communications, said the industry has “gotten too hyped up” about SaaS and it’s “not the be all and end all.”

SaaS certainly has some advantages. For example, as Turek pointed out, you know all your users are using the same version of an application and you’re only paying for software as you use it. She said companies for some time have been using customer relationship management and enterprise resource planning software on a hosted basis, and that has proven the concept works for mission-critical applications.

Digium Inc.’s Switchvox, for example, works with Salesforce.com to pull up customers’ records when they phone call centres.

Turek pointed out hosted software can end up costing companies more in the long run, depending on how long they subscribe to the software and the up-front licensing cost.

Frost & Sullivan did predict demand will increase, despite the recession. Elka Popova, the research firm’s program director for unified communications, said her company is predicting hosted telephony will be used by 3.4 million individual users in North America by 2014, up from one million today.

Turek said some are concerned about the security and reliability of software as a service, given that the data residing in the applications may not be entirely within their control. However it may not be safe to assume that data residing on your hardware is less secure than data residing on your contractor’s hardware. What is safe to assume is that security concerns over outsourced computing resources will help some vendors. At the recent RSA conference, Cisco CEO John Chambers said companies who have “no idea” what’s in the corporate data centre will enable his firm to “sell a lot of stuff to tie that together.”

Though pricing, reliability and security are legitimate concerns, an even bigger question is whether a hosted communications application will work well with your e-mail and contact applications. Because at the end of the day, it’s supposed to reduce the IT manager’s workload, not force you to hire more support staff.

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