I mentioned in last Friday's post that Unified Communications is expected to require much more systems integration work than traditional telecom implementations. That's directly related to the fact that communications is becoming more of a software business and less of a hardware business. It also means that many of the "hardware" vendors of the past are trying to imitate IBM's successes of the last decade in re-positioning from hardware supplier to software/services firms.Here's a good primer on what to look for in a VAR or SI for the Unified Communications space; for the most part, in that post, Marty Parker is talking about companies that have been in business as VARs or SIs, as opposed to equipment vendors seeking to re-position themselves. But it gives you a good summary of what everyone in the UC software/services space is jockeying to become.

As far as companies that today sell IP-PBXs, there are basically three major models, tracking to the three top vendors in the space.

Nortel made the boldest, most controversial, and (at least to some observers) riskiest move when it partnered with Microsoft to create the Innovative Communications Alliance, or ICA, announced in January 2007. As part of the ICA, Nortel has gotten first crack at some Microsoft integrations; for example, the Nortel Communications Server 1000 call control platform was the first to integrate natively with Microsoft Office Communications Server (OCS), though other IP-PBXs will follow. The two companies also committed to joint R&D and product development, though there has been little announced on this score to date.

But the real challenge for Nortel is that it's trying to use ICA and its special relationship with Microsoft to become more of a services company, one that consults and helps with OCS implementations. On that front, the Nortel exec in charge of ICA, Ruchi Prasad, told me earlier this year that 40% of all OCS-certified technicians are Nortel employees, and this figure is 23% for certifications on Live Communications Server (LCS), OCS's less voice-centric predecessor.

While that represents progress, there's an inherent tension to Nortel's efforts, as Ruchi conceded to me:

Absolutely we've been doing a lot of the [OCS] deployments. We haven't published the numbers. But at the same time, we've also been working on enabling our channel partners...[who] also have aspirations to work and deploy services....Sometimes the customer is saying, Nortel, we want you to do this. And in some cases they continue to work with their channel partners.

When a manufacturer seeks to become a services provider, it runs the risk of competing with its channel. The same challenge exists for Avaya, which is ramping up its services and consulting arm. The new head of Avaya Services, Chris Formant, has a long and successful pedigree in big consulting firms, and he told me last March that Avaya is aggressively hiring consultants for this practice, and would be open to the idea of acquiring specialist consultancies, though this isn't an emphasis today.

Finally, there's Cisco, which just recently posted a Webcast (registration required) outlining its "Services 3.0 strategy." Obviously, being Cisco, it has a broader reach into the enterprise, touching not just the real-time communciations gear, but the underlying IP network infrastructure of most large enterprises. So simply by making a more systematic effort to understand its customers' networks better, Cisco has the opportunity to use a services play to sell more equipment.

For example, in the Webcast, Nick Earle, senior VP of Cisco Services/European Markets, explained that Cisco already has put network-data collectors in its largest enterprise accounts, and is seeking to install them now in smaller accounts. Among the findings so far: Only 56% of deployed Cisco gear is currently covered by a maintenance contract, offering a service sales opportunity for the other 44%. Likewise, 30% of deployed Cisco equipment is end of sale or end of life, representing a clearly identified sales opportunity.

But Cisco's emphasis is on training its channel partners and assisting them in delivering services, potentially in some accounts offering Cisco guarantees and SLAs, but relying on the channel partner's knowledge of multiple vendors' systems, like Oracle or Microsoft, according to Earle. He said Cisco has no desire to become a full-service SI/outsourcer: "That's a tough business to make very good margins on," he said in the Webcast, noting that Cisco enjoys 62.7% margins on its services, and directly employs just 8,900 people worldwide in this division, as opposed to the 100K+ it would require to deliver the complete SI/outsourcing service to the largest accounts.

Each of these business models -- Nortel, Avaya, and Cisco -- represents a different response to the changing market conditions that UC brings about for manufacturers of the devices we used to call PBXs. It remains to be seen who will emerge from the transitions that are under way, and what their business model will look like.