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ShoreTel Quarterly Update

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ShoreTel continues to execute well and it is particularly pleasing to see this in a quarter that is seasonally lower for us.

Our industry is at an inflection point and there are a number of factors driving this. The impact will change the dynamics of the industry and create a new paradigm which will dictate who are the winners and losers in our industry. We believe that several trends in unified communications that have converged to create this opportunity for us.

The first is that we are seeing a significant increase in the focus on the mobile worker. Frost and Sullivan estimates that 84 percent of companies have mobile workers. Companies are embracing tools and technologies that support the productivity of their mobile workforce. The key for us is that the decision makers understand the opportunity to improve productivity and that Unified Communication tools are right at the center of that.

Second, the end user is growing in influence and making a significant impact on many aspects of IT decision-making. Ease-of-use has a key role in whether a technology is enthusiastically accepted or never lives up to its potential. ShoreTel has always led in ease-of-use but we are taking nothing for granted and are extending our advantage in this area.

And third, the move to the cloud is gaining speed. This represents a new business model. The cloud UC market is estimated to be growing at a compound annual growth rate of 30 percent over the next few years and is expected to be 40 percent of the combined premise and cloud UC market by 2015.

ShoreTel is ideally positioned to capitalize on these trends. We offer a combination of premise, cloud, mobility, and in the future, a hybrid solution that gives us a significant advantage in the marketplace.

As it relates to mobility and BYOD, our feature rich and easy-to-use mobility solution enables us to help our customers to empower their mobile workers. We have two years of experience in offering our mobility solution to the market and have continued to improve on it during this time to ensure it remains in a leadership position.

Our cloud solution is considered to be one of the best in the industry, giving us a solid position with huge growth potential. We believe our product serves the cloud business customer in ways our competition does not. For example, our integration with business-critical applications, such as Salesforce.com, linked to our voice and UC capabilities, puts our solution in a class by itself in terms of value add to businesses. We have several other third-party applications that we plan to integrate in the coming quarters.

Today, most customers still choose premise-based systems, however we are increasingly seeing customers express interest in a pure cloud solution and the ability to migrate to the cloud in the future. In addition, customers will soon have the choice of a hybrid solution that enables them to have a premise system with their applications installed in the cloud. This not only gives the customer a very interesting business model, but also allows them to pick and choose what goes into the cloud.  We believe we are better positioned than any of our competitors to provide this range of choice.

Here’s to a great second quarter.