Mitel Fends Off Rumors About Position on UC, UCaaS

(Pictured above: Rich McBee, president and CEO of Mitel, on stage at Mitel Next, Oct. 4, in Phoenix.)

MITEL NEXT — Despite rumors to the contrary in the aftermath of its acquisition of ShoreTel, Mitel remains just as committed to unified communications (UC) as it is to unified communications as a service (UCaaS), as well as contact center, as it pursues new business opportunities with its partners.

Mitel’s Todd Abbott on stage at Mitel Next in Phoenix, Oct. 4.

That’s what Todd Abbott, executive vice president of global sales and services, told attendees Thursday at the Mitel Next conference in Phoenix, which started on Monday. Many of them expressed concern that Mitel planned to abandon UC in its overall business strategy.

“We’re the unique company that has the full portfolio to be able to address a customer’s requirements on a rip-and-replace to cloud, on a migration, or stay on site,” he said. “We still do over 1 million seats per quarter in on-site, so there’s still a very big business for the on-site market and our VARs know that business well. But they can’t deny the fact that there’s a big shift moving to cloud and they’ve got to get out in front of it.”

Bob Agnes, Mitel’s executive vice president of products and solutions, said both UC and UCaaS are strong and equally important. Mitel has 70 million UC licenses, 1.2 million UCaaS users and 1.1 million contact center licenses globally.

Steve Rubin, owner of Peak Communications, said Mitel’s message regarding UC and UCaaS is “something I’ve felt for a long time.”

“They both have their place,” he said. “There [are] going to be clients out there that say, ‘I’m not interested in UCaaS. I want a box in my office that I can touch and feel, and work,’ and there [are] going to be others, and usually we’re seeing it’s the younger folks, that say, ‘No, I want it to be a UCaaS application because then all I’ve got is a phone on my desk.’ So I think they’re going to continue to support both of them; I think they’re going to continue to have them available, and it will be interesting to see where the hardware piece of it goes.”

Rich McBee, Mitel’s CEO, said the company is executing a “very strong strategy” and is making investments in all areas of the business.

“We are constantly pulsing the end customers on where they’re going and what they need,” he said. “Everything we’re doing is based on what customers want and need today and tomorrow. It’s deeply rooted in customer feedback.”

In April, Mitel announced it is going private by agreeing to sell to an investor group led by affiliates of Searchlight Capital Partners in a $2 billion, all-cash transaction that also covers the company’s debt. McBee said the company will be going private in 30-45 days, and that partners will not be impacted in any way, but behind the scenes “it will be a very big event.”

Mitel and its partners are facing the biggest opportunity since Y2K and “a new spike in our business is upon us,” McBee said. Digital transformation is separating the “winners from the losers” and every business is moving to some type of cloud, he said.

“Customers have the ability to choose how they move forward,” he said. “With Mitel or without, they are going to move forward. It’s up to us to increase opportunities to move forward with us.”

UCaaS is all about speed, ease, affordability and not having an IT department, while UC is about control and ownership, McBee said.

“If you’re not addressing what your customer is thinking, you’re going to lose them,” he said. “The challenge for each one of you, go back to your team and ask, …

… ‘What have we done to connect with our entire customer base?’ People are talking to them from the UCaaS side … that’s what our competitors are doing. They don’t care if it’s their customer or someone else’s; they’re hitting it every day.”

Mitel completed its ShoreTel acquisition just over a year ago and Abbott said the integration has gone “very well.”

“We have been retooling our business from a systems, go-to-market and channel-program standpoint significantly over the last 12 months,” he said. “The big thing we’re going to be doing in [the first quarter of 2019] and to [the second quarter] is really going through a simplification of the pricing of our products to make us a much easier company to do business with. We’re focused on getting what I like to refer to as the friction out of the system. Anytime it requires some type of communication engagement to be able to respond to a customer situation, that’s friction.”

This requires a lot of rebuilding systems, “but we’re doing the heavy lifting and spending an awful lot of time, effort and money … to make this as efficient of a channel as possible to the customer,” Abbott said.

Packet Fusion previously partnered with ShoreTel and “we were foes (with Mitel) for many years,” but after the Mitel acquisition, “we’re all one big happy family now,” said Matthew Pingatore, Packet Fusion’s CEO.

“It’s been great,” he said. “There were definitely some troubles trying to join your enemy to begin with, but the executive team at Mitel has been greeting us with open arms and being very truthful. There were some troubles for sure, but they listened to us and they fixed them, and we can all now go on, which is forward and global domination.”

Mitel and its partners can’t turn their back on traditional on-premises UC because “that’s what pays our bills as we fund the transition to the cloud,” Pingatore said.

“We are all doing that transition to the cloud and we’re all doing it together,” he said.