With the Mitel deal now off, Polycom needs to build its own bridge into a cloud future. Nick Tidd, who runs their Global Partner Organization, outlines the company’s plans to do just that, with one key objective being to get their own channel to sell Polycom and Microsoft together.
Last Friday, the news broke that Mitel’s acquisition of Polycom is off, with the company now being purchased for $2 billion by Siris Capital Group, a venture capitalist company, and Mitel pocketing a cool $60 million cancellation fee for its trouble. The end of the Mitel relationship removes some partner concerns, but also ends some significant new opportunities stemming from synergies with Mitel. Going forward as an independent company, Polycom is looking to significantly grow its Microsoft relationship. In particular, they are looking to get partners who sell both Microsoft and Polycom to be more aware of the relationship and sell Polycom and Microsoft together – something that is happening too seldom today.
“Partners fell into two camps on the change with Mitel,” said Nick Tidd, VP of Polycom’s Global Partner Organization, after getting partner feedback since the deal’s cancellation was announced. “One of them had been concerned about the product and resource overlap stemming from the merger. They were also concerned about the implications of merging two different cultures. The other camp acknowledged that being acquired by a private equity firm negates all those issues, but are asking what we will look like when the company goes private.”
Tidd said while there were clearly synergies with Mitel which will now not happen, particularly around cloud and wireless, going private is a huge plus for a company like Polycom which is in the process of reshaping itself to meet the needs of a changing market.
“As a private company, we can right-size things without having to meet quarterly expectations,” Tidd said. “We have a lot to do. We need to address the cloud and our technologies in cloud enablement. We need to build out a stronger Microsoft practice. We need to build out a global offering. There is a lot of complexity gone because we don’t have to do all this while integrating product portfolios and channel programs at the same time.”
Microsoft has been emphasizing at this event the need for companies to adapt – specifically to the cloud – or die. Tidd said that Polycom, as a legacy hardware vendor, is well aware that this applies to them.
“Everything we do now is moves to OPEX subscription models,” he said. “Not only does that change things on the product side. It changes everything on channel go-to-market on enablement. In hardware you aren’t concerned about who you are selling to but who you are selling though. In software, who you are selling to matters.”
Historically, a partnership with a software giant like Microsoft wasn’t critical to Polycom. Microsoft’s own shift to the cloud has energized their importance to Polycom.
“Microsoft for many years was all about selling licenses,” Tidd said. “Now it’s consumption, the use of their platforms. We drive that consumption when you attach an endpoint, but there’s a lot to be done there in terms of workflow.
Tidd acknowledged that’s a difficult process, for both Polycom and its partners.
“I just talked with a partner who you would think would have this completely baked out, but he told me they are making it up as they go.”
Tidd said that closer co-operation with partners around Microsoft is indispensable – particularly as many Polycom partners are not even aware that Polycom and Microsoft are partners.
“As I do events, I find that most partners not even aware of the Microsoft-Polycom relationship,” he stated. “They are selling E5, and selling Microsoft, but not selling E5 with Microsoft when they sold it. I ask at events ‘How many of you are selling E5, and all the hands go up. Then I ask how many of you are attaching E5 to Microsoft, and all the hands go down. They are missing out on a huge opportunity.
“My team’s challenge is to connect the two dots, both at events like WPC, and also by leveraging our distribution relationships. We also have a much more robust technology platform than we did a year ago at WPC and we need to leverage that. Our alignment with Microsoft is now very significant from a product enablement perspective. The challenge now is how to channel enable that.”
Polycom recently strengthened the product portfolio with the announcement of three different video solutions for Microsoft at the Enterprise Connect Event in Orlando.
“We will participate in Project Rigel, a new video spec for the conference room,” said Laura Marx, Senior Director, Alliance Marketing, at Polycom. “It’s based on a Surface Pro in a console that sits in the middle of the conference table and which has the identical look and feel of the Skype for Business UI.” Polycom will also partner with Microsoft and co-develop additional purpose-built Skype-for-Business video solutions, and will certify their RealPresence Trio and CX5100 to work with Project Rigel video solutions.
“Polycom will also Microsoft qualify its Group Series portfolio for Office 365 and will have a native looking Skype for Business UI,” Marx added. “We will also create a cloud-based video-interoperability service like our RealConnect for Office 365, hosted on the Azure cloud. It effectively provides RealConnect for Office 365 users.’
Tidd said that Polycom has added new resources to strengthen the channel enablement side of the equation.
“We have invested in business development teams around the Microsoft practice, so I have subject matter experts on staff,” he said. “These resources will all be free of charge to partners to enable them to take advantage of the momentum. We’ve done a really good job getting people excited about Skype for business and E5, but they still wonder how to monetize consumption, if they aren’t just bolting on a handset. We need to educate them that we don’t want to make money selling handsets, but on selling a total solution.”
Tidd said that some partners are proactively working together to do just that – something that Polycom wants to see more of.
“Several tier one partners have merged their practices together to demonstrate their expertise, for example, blending a UC practice in one with a Microsoft practice in another, to create a total suite,” he said. “We encourage them to further wrap managed network services and assessment services around that.”