M Parker UniComm Consulting & EB Kelly KelCor 2014
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3 M Parker UniComm Consulting & EB Kelly KelCor 2014
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5 Sample RFPs for 2000 employee company What we found: Option 1: On-Premise IP Tel and UC Option 2: Cloud-based IP Telephony and UC Home Office Workers Customers & Field Workers RO #2 50 Stations Internet Network #1 Network #2 M Parker UniComm Consulting & EB Kelly KelCor 2014 MPLS VPNs Network #1 Network #2 HQ 1750 Stations Network #1 PSTN Network #2 RO #1-200 Stations Mobile Workers MPLS WAN SIP Trunk Internet Cell/PSTN LEGEND Home Office Workers Customers & Field Workers Internet Network #1 RO #2 50 Stations Network #2 Cloud IP Tel & UC Provider MPLS VPNs Network #1 Network #2 HQ 1750 Stations Network #1 PSTN Network #2 RO #1-200 Stations Mobile Workers MPLS WAN SIP Trunk Internet Cell/PSTN LEGEND
6 $7,000,000 Normalized Versus Original Bid TCO Comparison for All Solutions over 5-years Microsoft Responses in 2012 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 Original Bid Normalized Source: KelCor, Inc. ; Stein Technology Consulting Group; Unicomm Consulting, LLC M Parker UniComm Consulting & EB Kelly KelCor 2014
7 M Parker UniComm Consulting & EB Kelly KelCor 2014 And, independently for unbiased results
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9 Defining the workloads is key to a proper TCO analysis Usually 5 to 7 user categories define the workloads for an enterprise Manufacturing Executive Highly Mobile Collaborative Worker Support Worker Task Worker Total Percent by Category 3% 20% 30% 17% 30% 100% IM/Presence 100% 100% 100% 100% 100% Federation 100% 100% 100% 100% 0% Deskphone 100% 15% 50% 70% 15% Softphone 100% 100% 100% 50% 30% Executive Video Unit 50% 0% 0% 0% 0% Mobile Smartphone Client 100% 100% 100% 50% 30% Mobile Tablet Client 100% 100% 100% 50% 30% Conferencing Hosts 50% 100% 100% 10% 10% Phone Type Multi-L, Speak, Touch Multi-L, Speak Multi-L, Speak 2-Line or Multi-Line Single-Line M Parker UniComm Consulting & EB Kelly KelCor 2014
10 M Parker UniComm Consulting & EB Kelly KelCor 2014 vendors tools with vendor and VAR validation
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12 One time costs Total server software Total software CALs Total hardware Total contact center Total videoconferencing hardware Total implementation costs Grand total one time costs 5-year total of annual support costs Server software maintenance / support Total CAL maintenance / support Total hardware support Total videoconferencing maintenance / support Total contact center annual support Grand total support costs Subtotal before support operating costs Operating costs Total rack space costs Total personnel costs Total power costs Total annual bandwidth cost Total SIP trunking cost Total operating costs Essential for Comparison of Premises vs. Hosted! M Parker UniComm Consulting & EB Kelly KelCor 2014
13 Analysis uses Microsoft SA or Microsoft EAS (subscription) for on-premises TCO EAS: Microsoft software licensing as an OPEX model, including support (SA) Standard and Enterprise CALs and SA (support) included in master EAS agreement Lync Plus CAL and SA for Enterprise Voice is charged at annual recurring EAS rate M Parker UniComm Consulting & EB Kelly KelCor 2014
14 One time costs On-Premises Percent Percent MS Lync Total server software $ 109, % #2 0.9% Total software CALs $ 1,559, % 12.6% Total hardware $ 511, % 4.1% Total contact center - - 0% Total videoconferencing hardware - - 0% Total implementation costs $ 327, % 2.6% Grand total one time costs $ 2,508, % 20.3% 5-year total of annual support costs Server software maintenance / support $ 147, % 1.2% Total CAL maintenance / support (EAS) $ 2,101, % #117.0% Total hardware support $ 109, % 0.9% Total videoconferencing maintenance / support - 0% 0% Total contact center annual support - 0% 0% Grand total annual support costs $ 2,358, % 19.1% Subtotal before operating costs $ 4,867, % 39.3% Operating costs Total rack space costs $ 28, % Total personnel costs $ 6,600, % Total power costs $ 21, % Total annual bandwidth cost $ 472, % Total SIP trunking cost $ 388, % Total operating costs $ 7,510, % Grand total $ 12,377, % #3 #2 #1 Licenses and license maintenance are 80% of system TCO IT personnel costs are more than 50% of complete TCO M Parker UniComm Consulting & EB Kelly KelCor 2014
15 One time costs On-Premises Percent Percent MS Lync Total server software - 0.0% 0.0% Total software CALs - 0.0% 0.0% Total hardware $ 511, % 5.3% Total contact center % Total videoconferencing hardware % Total implementation costs $357, % 3.7% Grand total one time costs $ 869, % 9.1% 5-year total of annual support costs Server software maintenance / support $ 243, % 2.5% Total CAL maintenance / support (EAS) $855, % 8.9% Total hardware support $ 109, % 1.1% Total videoconferencing maintenance / support - 0.0% 0.0% Total contact center annual support - 0.0% 0.0% Grand total annual support costs $ 1,200, % 12.5% Subtotal before operating costs $ 2,069, % 21.6% Operating costs Total rack space costs $ 28, % Total personnel costs $ 6,600, % Total power costs $ 21, % Total annual bandwidth cost $ 472, % Total SIP trunking cost $ 388, % Total operating costs $ 7,510, % Grand total $ 9,579, % #1 EAS licensing reduced 5-year system TCO by ~$2.8 million IT personnel costs are now ~69% of complete TCO M Parker UniComm Consulting & EB Kelly KelCor 2014
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19 advantage disadvantage Lync Cloud vs. Lync On-Premises Without Operating Costs Core UC with Enterprise Telephony, EAS Licensing. No Contact Center or Video EV & Conferencing Conferencing Only 108% 225% 340% 393% 401% 539% 604% -61% -27% 26% 98% 74% 247% 419% Employees 500 1,000 2,500 5,000 10,000 25,000 50,000 M Parker UniComm Consulting & EB Kelly KelCor 2014 In this heat map, no operating costs are included; the cloud solution appears to be a poor choice.
20 advantage disadvantage Lync Cloud vs. Lync On-Premises With Operating Costs Core UC with Enterprise Telephony, EAS Licensing. No Contact Center or Video EV & Conferencing Conferencing Only M Parker UniComm Consulting & EB Kelly KelCor % 19% 27% 34% 26% 33% 36% -72% -62% -56% -51% -54% -50% -48% Employees 500 1,000 2,500 5,000 10,000 25,000 50,000 When operating costs are included, Lync cloud-based solutions are favorable for conferencing across the board and equivalent to on-premises for small enterprises
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25 On-Premises or Hosted On-Premises or O365 Mobility M Parker UniComm Consulting & EB Kelly KelCor 2014
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27 Analyst firm A: $ 214 per user per year for ongoing operational costs Analyst firm B: $ 714 to $1,912 per user for first year VoIP or IPT & UC operational costs* * Reports note that UC&C increases the scope of services provided, thus initial integration costs M Parker UniComm Consulting & EB Kelly KelCor 2014
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31 Next steps Decide what s next for your enterprise Click here Visit Microsoft.be/enterprise and subscribe to our new Enterprise newsletter. cadohan@microsoft.com
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