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Broadvox and Cypress merger touts savings? Customers scream back, “so what?”

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While we think the merger between Cypress and Broadvox is a smart move for both companies, we laugh at the idea that mid-sized companies are focused on increasing the savings on their phone bills. Sure, "Broadvox will benefit from the increased utilization of its network backbone" but why do customers care about that? SIP trunking just drives PRI prices even lower using IP technology. Who cares?

What mid-sized companies really care about is making more money and surviving this challenging economic climate. But no companies have ever cut their way to growth, and if our industry keeps emphasizing cost savings, we are going to quickly realize we are speaking a completely different language from our audience.

Mid-sized companies are looking for strategic applications that help them grow sales, measure marketing effectiveness, and increase service levels in order to keep their customers in a fiercely competitive environment. Increasingly, even in our uber-connected Facebook era, this is actually being done over the phone. You know how Netflix finally killed off Blockbuster? They got rid of their customer service email option. They understood that if it's 2 am and you want to know where your “Ironman 2” DVD is, you want to discuss the issue with a person, not receive a Twitter update. It’s similar to being a parent and hearing about an emergency situation at a child’s school. Would we prefer to communicate with the school over the phone or via email?

The phones are better in the cloud partly because that’s where all the critical applications are going, like Salesforce.com. Now, it's also technically better, because most phone systems are next to a mop in a closet (while hosted resides in a data center), and you don't have to tie up your increasingly overworked IT resources.

But if the hosted industry doesn't start emphasizing these benefits instead of focusing only on price, we might as all just be Skype or Vonage. How do you save someone 30% off a phone bill that has gone down 70% in the last 15 years? Ask a CFO to identify his/her bigger line item in the budget; is it the phones or the marketing budget?

We think Cypress has done a better job than many by focusing on their hosted offering. This is now in danger of descending to the standard Telco service standard, as management has to manage multiple products and a complicated network. We must not forget that hosted is trying to prove once and for all that it makes no sense to buy an Avaya or a ShoreTel. Let's not fall for their trick of making it seem as if the phone decision is solely about price or features. Otherwise, we will all get thrown into a spreadsheet arguing about the rate of cell phones in India.