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Polycom CEO: Eight Out Of 10 Times, We Can Win Against Cisco

December 20, 2012 | Telepresence Options

AndyMillerPolycom.jpgChad Berndtson, CRN, December 20, 2012

Andy Miller joined Polycom in 2009, several months before Cisco acquired Tandberg, Logitech acquired LifeSize, and an ongoing consolidation among videoconferencing players seemed imminent. He became CEO less than a year later and began the strenuous process of not only growing Polycom but also shifting its purview -- something that hadn't changed much in the decade since Polycom bought its way into video dominance with PictureTel.

But if there's one thing Miller, a former Tandberg CEO, Cisco executive and longtime industry executive, has effected during his two years running the $1.5 billion company, it's change. Polycom today is very different than it was even a few years ago, having rebranded, refocused, re-engaged with a channel that it had all but neglected, and taken the fight in a tough market to Cisco, whose video market share has declined in the past year. Crucially, Polycom has shifted its own sales conversation from IP telephony endpoints and video infrastructure to software, services and cloud-based conferencing, all of which Miller sees as key to preserving video partner margins in the future.

Polycom's been challenged here and there on the earnings side, but its more than 7,000 partners, by and large, like what they're seeing. Miller in a free-wheeling interview spoke about the company's major moves.

Back when Cisco bought Tandberg and there was a lot of talk about the video market consolidating, a lot of folks in the industry wondered what would happen to Polycom. They didn't see a clear strategy at the time. They do now. What is your message to Polycom partners looking to profit from video and the cloud?

We set out on this journey in the context of how can we make sure we augment and expand the partner opportunity to make money, and provide differentiation. We made it really clear that these cloud-based technologies we would not sell direct. We are partner- enabling all of these technologies and partners can sell CloudAxis much as they do other products today, through reseller and white-label agreements. So first and foremost, we did not change our philosophy about channel enablement.

Secondly, we brought solutions that allowed our partners to not only extend their product portfolios but have a clear differentiation vs. Cisco, LifeSize and others. We announced a lot at once -- there is some complexity there -- but we're now working hard with the channel on education and training. How do you sell next-generation, virtualized solutions? There's a lot there to absorb. But they're going to make good money and higher margins with what we're doing here.

Your savvier partners seem to understand now that video isn't so much about reselling endpoints and infrastructure as it is about having a greater capacity for services, managed and otherwise. How are you enabling that? How do you see them making money with video?

We have about 7,000 partners globally. We look at them in seven different areas, including application developers, integrators and service providers. There will be traditional Polycom partners that can move into this new world of software and clouds pretty easily. We will also be adding new partners, who are the app developers using our set of APIs, and public cloud providers, and integrators like Dimension Data who can cover a more complex solution. We hope that all of our partners make it over the chasm. Some will. Some will not, frankly. The ones who do will make the investments in education and understand that it's a very different market now.

The other concern more traditional VAR and integrator partners keep bringing up is they see what service providers and telcos can do now with regard to delivery video at scale. It's not your job to manage competition between telcos and VARs, but will VARs enjoy the same opportunities with Polycom that the service providers do?

I think there's a place for everyone. The global guys offer solutions for customers who require a global reach. Others are more vertical-market-oriented, or satisfy niche opportunities. I do think each of them serve a different constituency. When we talk about cloud, we made it very clear that the tier-one service providers will be able to sell it but that VARs will also be able to leverage Polycom's branded resources. That will bring them opportunities, maybe even against the largest service providers. We want to give each partner constituency the opportunity to be successful.

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