Rollout: ShoreTel's E911 and Salesforce.com

A reasonable start for an up-and-comer, but a lack of Web services and smaller size put ShoreTel's telephony apps in a slightly different league than veterans such as Avaya

September 22, 2006

5 Min Read
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IP telephony vendors have long marketed their products under the notion that combining voice and data would enable a "business transformation." Delivering on that transformation, however, has been another matter. ShoreTel, though, took a critical step toward this transformation last month, with the release of its integrated application strategy.

The strategy calls for ShoreTel to develop standalone telephony applications and enhancements to existing business applications, to go along with its IP PBX systems. The company added telephony capabilities to the Salesforce.com customer resource management application and rolled out an Enhanced 911 application for large companies. ShoreTel also launched DevNet, a professional services organization to coordinate the work being done by 350 resellers and end users who joined ShoreTel's developer program.The introduction comes at a critical time for ShoreTel. The 100-person company has made waves within the industry for its unique, easily managed, distributed architecture, which the vendor claims can scale to 10,000 users. At the same time, ShoreTel must continue to push up the application stack if it's to differentiate its product offering and provide a reasonable exit strategy for its investors, which have included Foundation Capital, J.P. Morgan, Lehman Brothers, Northwest Ventures and Venture Partners. Providing application-integration services is a move that opens new markets for ShoreTel and lets IT improve on its VoIP investment by embedding communications within the business process.

ShoreTel isn't alone in recognizing this opportunity, nor is it the biggest company in this market. The privately held company, whose revenues are estimated at $12.5 million by Hoovers.com, will compete with application and telephony integration portfolios from Avaya, Cisco Systems and Nortel Networks. However, the Shoretel SDK (software development kit) is not particularly cutting-edge and must compete with offering from such players as Avaya, Siemens and Sphere Communications. These vendors have all created a buzz recently with their Web services interfaces for integrating with third-party applications, something ShoreTel presently lacks.

ShoreTel

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The Applications

With last month's announcement, ShoreTel introduced two applications that leverage its phone systems. ShoreTel will let users of Salesforce.com place calls by clicking on an icon or name, thereby greatly increasing the number of calls sales personnel or telemarketers can place. When customers call, the appropriate information also can be retrieved from the company's CRM system, which will improve agents' efficiency.ShoreTel's new E911 application will appeal to organizations located in large office buildings or on expansive campuses. The application tells an IT manager the location of the specific extension from which a user placed an 911 call. The office manager or security personnel can then meet emergency personnel and direct them to the emergency without causing undue alarm. The E911 application also will likely be suitable for hotels, resorts, parks and other businesses in which discretion is highly valued. Another potential market includes prisons and other restricted-access facilities. Emergency personnel need to be guaranteed safe and expedient access, which means ensuring that the people with the right door keys are present to provide that access, based on the phone extension for that room or location.

Pricing for Salesforce.com integration starts at $100 per seat. The E911 notification app starts at $2,000 for up to five clients and jumps to $5,000 for six or more clients. The fee for using ShoreTel's developer network is $995 per year.

Challenges

ShoreTel's new DevNet should attract enterprises interested in deploying a ShoreTel switch, but is unlikely to persuade companies to purchase a ShoreTel switch on its own. Most major IP PBX vendors already provide large, well-developed professional services organizations. The ShoreTel division today constitutes a single developer and just two applications.

The programming interface used for releasing these applications is also a disappointment. ShoreTel's SDK is based on Microsoft's TAPI interfaces version 2.1, limiting it to Windows-only desktops. While Avaya, Sphere and others offer TAPI interfaces, the big push has been on Web services. Avaya, BlueNote Networks, Siemens and Sphere have all announced or delivered Web services interfaces to their IP PBXs, which provide platform-independence for applications while also reducing the time to market by shielding developers from the nuances of setting up and tearing down a call. To some extent, ShoreTel has addressed the issue by creating a COM (Common Object Model) object against which developers can use Visual Basic, C#, .Net or other COM-capable languages.Still, TAPI is decidedly telephony-centric. Although telephony is still the primary mode of communication in most instances, other modalities are increasingly popular. Sphere's Spherical Web Services interface, for example, gives developers access to presence state and the instant messaging capabilities built into the platform.

Integrating applications with the business applications is an important tactical and strategic step for IT, extracting more value from their existing capital investment and providing a competitive edge. ShoreTel's strategy addresses both needs, at least to some extent. The company may be able to address the needs of midsize enterprises, but current resource limitations and the lack of platform independence and support for new modalities will limit influence in the largest enterprises. n

David Greenfield is NWC's editor. He has spent 20 years analyzing virtually every networking technology and has consulted to and assisted Fortune 500 enterprises in their technology acquisitions. Write to him at [email protected].

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