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Understanding Avaya’s Incomplete Total Cost of Ownership Claims

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Avaya recently commissioned the Tolly Group to prepare a report comparing the total cost of ownership between the Avaya IP Office and ShoreTel solutions.  It is not surprising the commissioned report concluded Avaya has a much lower TCO.

Although we do not challenge the reputation of the Tolly Group, we do conclude their analysis is incomplete, and does not represent the true TCO a customer will face over a five-year-period.   There is a saying I have – it takes you five minutes to find out if a dentist is a nice person, but it takes five years to know how good their work is.  This applies equally when one compares quick observations made in a lab setting versus gathering the actual costs customers experience in a real production environment over multiple years.

The Tolly report leaves out many of the material costs customers will face over five years.  ShoreTel’s total cost of ownership calculation is far more precise.

For example:

1)      No customer data was incorporated in their analysis of costs.  ShoreTel commissioned the Aberdeen Group to survey more than 300 customers and collect their actual historical operating cost data over multiple years.  This is the only way to know what the actual operating costs will be, and is far more precise than a lab experiment.

2)      The report does not include the expected software upgrade costs a customer would face over five years.   ShoreTel does not charge for upgrades.  Avaya charges for all feature releases, resulting in higher costs.

3)      There are no labor costs for operating the system included in the analysis, as their lab experiment implies they are the same.  Customer interviews validate more resources are needed to manage Avaya IP Office systems, resulting in higher costs.

4)      No actual customer data reflecting demand on IT to support users is included.  The analysis of Avaya versus ShoreTel customers validates Avaya IT departments get more requests from users, which results in higher support costs.  Avaya’s own One-X Portal product literature indicates their products do not always operate as expected.

ShoreTel holds to the accuracy of our TCO calculations and guarantees the results.  If Avaya can produce statistically accurate customer data gathered from a third party that can demonstrate their TCO to be lower, ShoreTel will lower our price accordingly.  Based on the feedback from the Avaya employees that have joined ShoreTel, from discussions with employees impacted by Avaya’s headcount reductions, and from discussions with resellers that sell both Avaya and ShoreTel, we find the interview results gathered by Aberdeen Research to be consistent with what customers face in the production environments.

We encourage prospective customers to source information from independent third party industry analyst reports that are not commissioned by vendors.   Read the complimentary copy of the most recent 2012 Gartner MarketScope for Unified Communications for the SMB Market, North America on our public website.  ShoreTel earned Gartner’s highest Strong Positive rating.