Cisco (NSDQ:CSCO) has changed the licensing structure for its unified communications products, positioning the changes as a response to Cisco partners that have asked for more flexibility in UC licensing and for more features to be added to certain packages.
Starting this quarter, Cisco will offer software-only licensing for customers that want to buy Cisco UC but not physical phones. The San Jose, Calif., company also will make free to the channel Cisco's Enterprise Licensing Manager, an application that helps partners and customers track the Cisco licenses they're using.
Perhaps most important, however, is that Cisco has rejiggered its licensing categories and added more bells and whistles to each without changing any of the pricing.
The categories are now described as Standard, for UC use by workers primarily in corporate offices; Enhanced and Enhanced+, intended for workers that split their use between corporate desktop and mobile; and Professional, for power users who are often on the road and don't spend much time in corporate offices.
Each category now includes access to Cisco Jabber, the company's fast-growing platform for embedding UC functions into a wide range of devices and operating systems. The Professional edition now includes WebEx Social, the social collaboration platform formerly known as Quad.
"Number one, it's user-based in nature," said Richard McLeod, Cisco senior director, collaboration sales, worldwide partner group. "Number two, it's greatly simplified in terms of partner ability to design and quote. This is very much business-value-oriented. We're putting a lot more value and a lot more capabilities into the same price points we had before."
All changes are effective with the release of Cisco Unified Communications 9.0, which the company first announced in June and which includes new features such as support for third-party conferencing endpoints and fixed mobile convergence.
McLeod said that collaboration software now represents a north-of-$1 billion business for Cisco and that there are more than 60 million Cisco UC licenses currently in use. McLeod previously told CRN that collaboration as a whole represents at least a $42 billion addressable market for Cisco partners over the next few years.
Collaboration was a weak spot for Cisco in its fiscal fourth quarter, but the company's overall UC and collaboration strategy has expanded and Jabber has been a big part of the story, having grown licenses 55 percent in volume.
At the Cisco Partner Summit in April, Cisco confirmed an offer called Jabber for Everyone, in which it made presence and IM capabilities and Cisco Jabber clients available at no additional licensing cost to Cisco partners. Solution providers applauded the move, seeing it as an easier way to entice customers to Jabber and get more Jabber licenses in the hands of customers more quickly, at less cost.
At the time, Cisco also said it would invest $1 million during its fourth quarter, which ended July 31, to reimburse partners for services that help deploy Jabber to customers. Cisco's promise was up to $20,000 per partner, depending on the number of Jabber licenses sold and, according to McLeod, Cisco blew through the entire $1 million earmark in 30 days.
"The momentum is just great," McLeod said. "We positioned Jabber for Everyone ... as a foundation and footprint into much bigger things and that we wanted to help fuel [partner] excitement."
Jabber is seen as one of Cisco's key weapons in the intensifying UC war with Microsoft, whose Lync platform is coming on strong. McLeod said that Jabber for Everyone has helped partners counter Microsoft Office Communicator and Lync deployments, declining to ballpark the number Cisco has displaced but describing it as "significant."
Asked about the competitive UC threat from Microsoft (NSDQ:MSFT), McLeod said Cisco is better equipped to support multiple devices and operating systems, especially in BYOD environments, thanks to its ability to support not just IM and presence but also VoIP and video and other advanced UC tools with seamless integration.
"There is always a competitor -- that's what makes this industry exciting," McLeod said. "That competitor seems to change every few years, but we're staying nimble. We enjoy and welcome competitors because it keeps us sharp."
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