Will Microsoft control the next-gen network?

In the future Microsoft Corp. might become an important vendor for the enterprise to consider when sourcing communication systems, says an industry observer.

Tom Valovic, program director of IP telephony at Framingham, Mass.-based IDC, says Microsoft will be hard to ignore as enterprise communication evolves.

“We weren’t trying to say Microsoft is going to get into the IP PBX business directly,” Valovic told Network World Canada. “What is, I think, much more likely is an emerging market centred on the enterprise desktop.”

The PC represents a battleground in Valovic’s research report, Beyond Telecom Chaos: Rethinking Next Generation Services in the VoIP Environment, published in August. That document describes a world in which users define their own communication needs via the desktop computer.

Users would turn on call forwarding and screening applications that connect cell phones, e-mail programs and corporate voice mail systems to policies that dictate which calls go where, when and in what medium – perhaps certain voice mail messages would be transformed into e-mail, for example.

The power behind this “user defined communication (UDC)” rests with the PC, Valovic says. Users would control the systems via desktop computers. That puts Microsoft, a firm known for its PC programs, in strong contention for the enterprise’s attention when it comes to finding communication platforms.

Valovic notes the Redmond-based firm has made strides in connectivity, having embedded the Session Initiation Protocol (SIP), a communication standard, into Windows XP. Microsoft also released earlier this year its Live Communication Server 2003, an Instant Messaging platform.

This isn’t to say, however, that Microsoft is prepped to take on the likes of Nortel Networks, Avaya Inc. and 3Com Corp. in the communication market.

“We see ourselves as complementary to existing service providers and network equipment providers,” said Ed Simnet, a product manager at Microsoft. “For example, our Windows messaging client and server, we have a number of network equipment providers, like Siemens, building on top of that as an adjunct to their platform to provide presence capabilities.”

Asked if Microsoft would take the lead-vendor roll for enterprise communication projects in the future, Simnet said, “That’s more of a business model question, which I’m not the right person to answer. From a Microsoft perspective, we are very much focused on making sure the products we bring to market integrate very well together.”

Avaya, a Basking Ridge, N.J.-based network gear maker, partners with Microsoft to make sure PC applications work smoothly with IP telephony systems, said Jorge Blanco, vice-president of product marketing. He said Avaya doesn’t view Microsoft as a competitor.

“In the discussions we’ve had at a partnership level, we haven’t seen anything that would say Microsoft is entering the telephony business proper, a la Nortel, Avaya et cetera. It’s much more of a platform supplier.”

But Avaya won’t discount Valovic’s report, he said.

“Any report of this type should ring bells for anybody, primarily for the nature of the company we’re talking about. It’s probably one of the most significant companies in high-tech that we’ve seen in the past 20 years.”

Still, Blanco figures complex enterprise communications systems require advanced back-end technology to work.

“I don’t think that’s where Microsoft has been,” he said. “I don’t think the desktop will be the only answer to the question. I think it will be a combination of front-office and back-office systems.”

Valovic, however, said the situation might change in time. As Microsoft gains experience in the communication sector, perhaps this company will become a force for Avaya et al. to reckon with.

“We think this is going to happen several years out, this competitive threat.”