Bob's golden parachute is modified

Yesterday brought us a 8K filing from Polycom:

http://phx.corporate-ir.net/phoenix.zhtml?c=112660&p=irol-SECText&TEXT=aHR0cDovL2NjYm4uMTBrd2l6YXJkLmNvbS94bWwvZmlsaW5nLnhtbD9yZXBvPXRlbmsmaXBhZ2U9NjY2NTkxNyZhdHRhY2g9T04mc1hCUkw9MQ%3d%3d

Looks like they have ammended Bob's golden parachute to pay him immediately instead of with an installment plan if he is terminated.  The 8k says its for tax reasons... but you think about 2ms about it.... if they are sitting there spending time thinking about Bob's severance agreement... they are probably doing that in preparation of Bob leaving.

Me

Well, I have changed positions and employers.  I am now working for 3com.  For those who know me personally, you probably already know why I left NET.   I am back to my roots of working with network transport.  3com also is fairly strong in security and in Voice as well.

As you know, HP & 3com are working on a merger so with that I will cease talking about what I think HP is going to do.  Same with 3com. Unless its public information, I wont be posting.  

But, lets just say, I'm pretty bullish on what HP & 3com are going to do as they go up against Cisco.

Sorry to see you go Sunil

http://phoenix.corporate-ir.net/phoenix.zhtml?c=112660&p=irol-SECText&TEXT=aHR0cDovL2NjYm4uMTBrd2l6YXJkLmNvbS94bWwvZmlsaW5nLnhtbD9yZXBvPXRlbmsmaXBhZ2U9NjYyNjM1MiZhdHRhY2g9T04mc1hCUkw9MQ%3d%3d

"On November 25, 2009, Polycom, Inc. (“Polycom” or the “Company”) entered into a Severance Agreement with Sunil K. Bhalla, the Company’s former Senior Vice President and General Manager, Voice Communications Solutions. Pursuant to the terms of the Severance Agreement, Mr. Bhalla will resign his employment with the Company effective the earlier of (1) February 28, 2010 or (2) the date on which Mr. Bhalla commences a full-time job for another employer prior to February 28, 2010. During the interim period, Mr. Bhalla will no longer serve as an officer of the Company and will be on paid time off and notice through February 28, 2010, or such earlier date upon which Mr. Bhalla commences a full-time job for another employer. Robert C. Hagerty, the Company’s Chief Executive Officer, will continue Mr. Bhalla’s duties as Interim General Manager of the Voice Division.

Pursuant to the terms of the Severance Agreement. Mr. Bhalla (1) will receive a severance payment in the amount of $326,667 (equivalent to approximately 10 months’ base salary), less applicable withholdings, payable in two installments; (2) will receive executive outplacement services for a period of twelve months, which are valued at approximately $9,500; and (3) has agreed to a non-solicitation of Polycom employees provision for a period of one year following the termination of his employment."

Everyone that knew Sunil certainly liked him.  Its too bad he is leaving under these circumstances. I hope he lands somewhere quickly and makes it through whatever issues he is going through.

Kudos to the taa shareholders

Wow...again...wow! I honestly thought it was a bluff. Who in their mind would want to try to bluff Cisco to increasing the bid for a buyout...but they did. CSCO's M&A is very successful. They've bought at least 100 companies:

http://investor.cisco.com/releasedetail.cfm?ReleaseID=424298

Lets say, they are no dummies. but...looks like CSCO is giving up another 400M.

I honestly thought that CSCO would walk away and call their bluff. You have to look at it this way, they are going to buy another 100 companies...TAA is just one of many... when this is your MO, you cant show fear. This deal could affect not only how CSCO prices acquiring companies, but also how acquired companies will negotiate for years to come. That $400M could turn into $Bs of dollars in extra costs for future acquisitions.

HP Buys 3COM!

M&A activity is way up!  Sometimes it blurs between what I blog and conversations I have with people. I certainly have been predicting that HP would do something. I thought it was going to be video related first. Tell you..I also figured that when HP did something, it would be Brocade!  It would have gotten HP both a SAN solution and a core Ethernet switch solution.

I'm not saying 3com is bad..in fact, its pretty damn interesting.  HP now has core ethernet, edge routing, core routing, security, and ip telephony.  Wow!  

I'd like to make one overall prediction across the board.  The fight is on for everyone to have end to end technology solutions. The race is on between Cisco, HP, IBM, Dell, Oracle.  I'm still confused about Microsoft and I think they might be too.  Sure..they're staying out of hardware...but everyone seems to betting big on hardware. This happens to be totally opposite of what the VC community is funding right now...all they want to fund is software and cloud.  So...specifics as to who marries who will change...but expect more of this.  Expect people who dont have storage, to buy storage. Expect people who don't have UC to buy UC.

The name of the game is bulk and breadth of solution!  I fully expect that we soon will only be standing with a few "startups" in the video space.  TAA will be gobbled up. PLCM will be gobbled up. Vidyo will be gobbled up.

Wait and watch!

New Cisco Video Phones

Cisco announced new video phones:

http://www.cisco.com/en/US/products/ps10453/index.html?POSITION=sl&COUNTRY_SITE=us&CAMPAIGN=IP+Phone+9900+Series&CREATIVE=Launch+Landing+Page&REFERRING_SITE=CISCO.COM+INDEX

They dont look like OEMs of the E20 from TAA.  They actually look similiar to the Aethra Maia
http://www.cisco.com/en/US/products/ps10453/index.html?POSITION=sl&COUNTRY_SITE=us&CAMPAIGN=IP+Phone+9900+Series&CREATIVE=Launch+Landing+Page&REFERRING_SITE=CISCO.COM+INDEX

I know, most of us in the US dont pay attention to Aethra...but the Maia is actually a pretty sweet phone with the ability for a soho user to have one device on their desk. it supports voice, video, sip, h323, and even pots!

Anyway...seems most people have not latched on to desktop video phones..but all of the mfgs are all focused on driving adoption.  I honestly think that products like these could become very popular...but not until the vast populace gets more comfortable with being on video. (which I think they are)

Android

This might seem a bit out of place...but I've got a great interest in the Android operating system. I, of course, got the T-Mobile G1 on the day it came out over a year ago. Then bought one of my daughters a MyTouch just a month ago.  Its a great OS and a great phone and certainly puts iPhones to shame!

Why bring this up in this blog?  Well..my thoughts are that Android could certainly be utilized as a platform for video conferencing systems.  It could be google that does it or it could be a third party.  Talk about have a rich operating platform to build a communcations system around!

Watch for someone to come out with something.

Logitech buys LifeSize

here's the press release!

http://www.lifesize.com/en/Company/News_and_Events/Press_Releases/2009/Logitech_to_Acquire_LifeSize.aspx

I have to say...pretty shocking. Both from whom is buying them...but also for how much. $400M!  Talk about cheap.  I think the rumors I had heard previously were that they & Cisco were talking about $1B.

Also....not from a money perspective..but from a perceived value standpoint, it seems weird that a pc peripherals company known for making cheap webcams bought a enterprise video communications company. Its like the mouse eating the cat.  Sure..this mouse was big and the cat was small..but it just seems weird.

I wonder how it will turn out?  Will Logitech make LS the flagship of the company and totally remake themselves? or will LS stay as an appendage doing their own thing. I guess we'll have to find out!

But...as I've said... the market is ripe for consolidation.  BTW... hey Michael Dell... man, you missed out!!! If $400M was the price..you could have picked up LS and really made a killing...as well as having an easy time doing the integration.  You could have picked up LS and made them move the 30minutes to the Round Rock campus and no one would have complained.  And...you could have used your online talent to market the hell out of the solutions.

Maybe...we'll have a two tier buy?  anyone want to take bets on HP buying Logitech?

Disclosure

If you're into watching financial and business news, you're probably keeping an eye on the Galleon case. Today's article was likening some of the activities as very James Bond-ish with disposable cell phones and secret code names.

Anyway...made me think if anyone wonders whats in it for me?  Since the dot bomb I've kept away from trading individual stocks. Yeah...ho hum..boring. I guess I have better things to do and I also realized that several years ago that I cant compete anyways with wall street. But in case you're wondering about my holdings I own the following:

EWA
ILF
XLE
FCNTX
FLPSX
DODFX
FFFEX


Thats pretty much it.  No CSCO.  No PLCM.  No RVSN.  
The rest is in even more boring real estate!

Customized Telepresence

I guess it was bound to happen... someone wanting to buy a TP system but have it fit different specs than the pre-made units.  I first heard earlier last week that Cisco has a group that will customized changes to your TP system...but now I see that Polycom does too: (i could not find anything on CSCO's website that said they have the service)

http://www.polycom.com/products/telepresence_video/telepresence_solutions/immersive_telepresence/atx.html

Its kind of funny that things come full circle.  Telepresence really started out as tubro charged AV integration...then it productized..and now they are offering integration. I guess thats just evolution for you.

Anohter PC company entering the fray?

Well, I just heard a pretty strong rumor that another PC company is going to enter the frey of the video conferencing market.  I know the name...but I thought twice about posting their name because they are known to be litigious against bloggers (maybe thats enough of a hint anyway).  The only thing specific I've heard is that the design is not based on DSPs but on a less costly hardware design.  Yes...and let me state...I've specifically heard its a room system....not software to run on an existing PC.

It either will give them a very low COGS and thus great margin...or potentially they'll come in at a dirt cheap price.  I've also heard that the design is going to be very elegant, and very simple.  It sounds like they are directly targeting "greenfield" video conferencing markets.  Most likely hip and trendy younger crowd that today probably uses Skype and wishes for something better.

On a more positive note... RMX4000 & RSS4000

There looks like good things happening on the product side at Polycom.  They've now released the Polycom RMX4000 which is a 2x of the 2000. And they released the nextgen RSS4000 which brings more recording capacity and 1080P support.  Both long needed and gladly out.  While I have not played with each, but should soon.. I have heard good things from several Polycom SEs that say the the triple play of 4.x software, MPM+ cards, and the bigger chassis are everything they ever dreamed of. (or least while thinking about work)

http://www.polycom.com/products/telepresence_video/conferencing_infrastructure/rmx4000.html

http://www.polycom.com/products/telepresence_video/recording_streaming/rss4000.html

Its good to see PLCM catching up in the infrastructure space.  Now, they just need to release a series of 1080P endponits (more than the 8006) to fully compete against the slew of products that both TAA, LS, and CSCO have.

OMG!!!!!!

This one took me by complete surprise. and those of you that work at Polycom or did work at Polycom will feel the same way.

http://phoenix.corporate-ir.net/phoenix.zhtml?c=112660&p=irol-SECText&TEXT=aHR0cDovL2NjYm4uMTBrd2l6YXJkLmNvbS94bWwvZmlsaW5nLnhtbD9yZXBvPXRlbmsmaXBhZ2U9NjU2NTA1NyZhdHRhY2g9T04mc1hCUkw9MQ%3d%3d

This 8K obviously doens't spell it out, but connect the dots on this web post and the one I just posted a couple of days ago.

Insider trading at PLCM

I guess normally I'd ignore articles about insider trading, as you read about them all the time in the WSJ.

http://online.wsj.com/article/SB125570373292090093.html

But...it was Saturday and it was front headline news.  It certainly was a tale you've read before tons of times.  In fact there was a big item about a month ago with insider trading with the Dell/Perot deal. So...why do I mention this... check out the graphic in the article that shows the web of insiders.  Down near the bottom you'll notice that a "unnamed executive" at Polycom was part of the web of people.  Who knows what that really means or who it was.  Probably no effect to PLCM unless it was someone with a real title.   I'm sure the news will turn up. Interesting...

Tandberg Q3

Tandberg just released numbers of Q3 this year and they are just a machine that keeps marching on...always gaining ground.  If you haven't seen the numbers, they're as follows:

-- Revenue of 234.7 MUSD (+11.6%)

-- Operating profit of 50.0 MUSD (+10.2%)

-- Cash flow from operations of 72.0 MUSD (+35%)

-- 18,260 endpoints compared with 17,487 last year (+4%)

-- Network Revenues up (+34%)

-- Service Revenues up (+18%)

I'm not surprised by this. The company I work for installs and services video conferencing systems. (We do not resell products nor influence the brand/model. )   We see north of 50% of the installs we're asked to do are TAA, the 2nd most popular is LS, and the last is PLCM.

I don't have any further numbers..I would love to hear the breakdown between product lines and what their average unit sold price was.

Another interesting point is that TAA by next quarter will be at a solid $1B run rate. Funny that nearly two years ago PLCM was in the same place but has since fallen.

Dear Barack... a followup letter

Obama
I'm doubting you read my previous letter about doing a cash for video program.  I really think you missed out on a great opportunity to make a gigantic impact on our economy.  Please reconsider...we can still pull this off.

But, I know you're tied up thinking about healthcare.   I've got some ideas here too.  

While I don't wont to make political comments and pick apart your plan... I do know that you are concern about accessibility and cost of healthcare. I do to.  But, form what I see, you're looking at this problem from a Chicago point of view.  And what I mean is that if you live in a big city like Chicago, you have tremendous access to healthcare.  You have tons of choices from free clinics up to the best specialists the world. But... not all of the US is like that. And I would certainly argue that the real problems with healthcare are outside of large cities.  What about places like Cut Bank, Montana?  Barrow, Alaska?  and probably 99% of the land mass of our country?    I'll tell you.. they are very limited in the availability of healthcare.  The costs are higher because facilities are smaller.  Specialists are further away.   Specialist tools and procedures are only available sparingly if not at all.

Telemedicine via video conferencing has been proven to improve accessibility and reduce costs.  This is where you can get dramatic bang for the buck.  It allows you to provide more healthcare at a lower cost point. Win-Win for everyone.

This is an easy decision and a low cost decision for you to make. Its also a decision that is not full of politics. Who would argue about putting more video conferencing in our healthcare facilities? No one!

Thank you
Jeff Z

There is always a twist

and there might be others...  buying a publicly traded company in Europe is not necessary easy nor fast.
Seems that Norwegian pride is slowing the Cisco Tandberg deal a little bit...

http://online.wsj.com/article/SB10001424052748704107204574474631868187714.html?mod=WSJ_hpp_sections_tech

or maybe thats just smart Norwegians expecting Cisco to open its wallet wider!

Tandberg T1

Tandberg certainly is not changing product plans or slowing anything down while the merger process goes on with Cisco.   The new Tandberg T1 was released and brings true telepresence down to a small room format.

http://www.tandberg.com/telepresence-products/tandberg-t1-telepresence.jsp

Not sure as to pricing yet.  But...I've got to think its between $100-$200k.

Skype

Just curious... what do all of you think of Skype? and what role do you think it could play in business or educational communications? Do you think more endpoint providers should support Skype? I'd really love to hear comments either via the blog or via email.

Distributors & Resellers

So...all the buzz right now is wondering about what will happen with distributors and resellers.

TAA is unique in that it has one distributor in the US, KBZ. Wow...thats a lot of risk for KBZ. They could turn up roses if Cisco leaves them... and it could turn up pretty bad if CSCO dumps them. Talk about a dicey situation.

Resellers I think are going to turn up different. Here's whats I'd do if I was making decisions... I'd start off by leaving things alone for the first 3-6 months and only allowing TAA certified resellers to sell the product. I'd develop a ATP program just for Tandberg and I'd try to get existing TAA resellers to get ATP certified. I'd promote to my existing Cisco resellers that if they want to sell TAA, they need be ATP certified for TAA.

Here's one thing for sure... TAA & CSCO need the expertise of the current TAA reseller community. They also want to add on new resellers...the existing CSCO ones... but, they need to be careful and not add on CSCO partners that dont know video. And..that is alot of them.

I know this because 1) CSCO recently told me this... and 2) I've gone into help tons of CSCO resellers that blew up even simple video conferencing installs of PLCM and TAA.

And the analysts say...

Polycom is in play...

http://www.reuters.com/article/innovationNews/idUSTRE5953VB20091006

http://network.nationalpost.com/np/blogs/tradingdesk/archive/2009/10/06/polycom-next-to-go-after-cisco-takes-out-rival.aspx

Even comments about Radvision!

http://www.globes.co.il/serveen/globes/DocView.asp?did=1000503311&fid=1176

and wow...did they read my blog to get the following news???

http://www.thedeal.com/corporatedealmaker/2009/10/avaya_may_partner_not_buy_on_v.php

http://www.ft.com/cms/s/2/7ce82002-b27c-11de-b7d2-00144feab49a,dwp_uuid=e8477cc4-c820-11db-b0dc-000b5df10621.html

Test post

Polycom hiring & firing

If you know people at PLCM... you might have heard..they're axing more. August was the time to axe sales management. At least 60 got the axe. Now, they're moving down the ranks and individual contributors are being shot. Account managers, channel managers, demo specialists, anyone that is either not performing or is located in the wrong spot.

I've also heard that PLCM is going to be hiring like crazy.

But...who knows... do you suppose they will continue that plan? or decide on something else? Well...I mean.. will the TAA sale make things happen differently? Probably not... PLCM needs to be aggressive. They have to count on something called "ABC". ABC is "anything but cisco"... and its a mantra that developed over the last few years. Unfortunately alot of the aggressive sales techniques often pissed often techies. Or bugs... or product lines that disappeared after only being available for less than a year. But..again..who knows. Random things do happen.

LifeSize Passport

http://www.lifesize.com/en/Products/Video/LifeSize_Passport.aspx

I see products like this one being one way the market moves. Its not for everyone, but it is a solution that SMBs, which are always the fast growing companies, are going to latch onto. Especially with the fact that the system will interoperate with Skype. Maybe with Silver Lake not getting Tandberg they might want to consider buying LifeSize to merge with Skype who they just purchased from eBay.

I haven't personally seen this product but cannot wait to see it. The price point is very exciting! $2500 for a 720p endpoint, wow!

Is there more coming?

Yes, I believe so. Just fairly recently Dell bought Perot Data Systems... but, why is that significant? Well, I think the proof point for a successful Tech company is IBM. Everyone wants to be IBM. Thats why HP bought EDS..and Dell bought Perot. They wanted professional services revenue. IBM also works because of size and because of depth and breadth.

I think the next expansion is going to be UC. I thought about this a week ago while reading an article in the WSJ that showed the top tech companies: IBM, HP, Oracle, Cisco, and Dell. It had categories like: pcs, servers, networking, and services. Whats missing from there is UC. IBM has a little, HP has a little, Oracle none, Cisco lots, and Dell none. But that could easily change. HP could pickup Polycom. Dell could pickup LifeSize.

I really think its going to be a mad dash to pickup the other two good companies. Yes, I know there is Aethra, Vidyo, and Sony. But... Aethra would most likely be picked up by a smaller player. Vidyo has a good chance of being picked up. They actually would be a good fit for Oracle... being a software company.

Lets see what happens!

Cisco & Tandberg..but what about Silver Lake?

Yes, I know, its already yesterdays' news, but if you were trying to enjoy the great day yesterday in the Bay area, maybe you tuned out and didn't hear that Cisco has made a tender offer for Tandberg of roughly $3B

http://www.ft.com/cms/s/0/3ffd5ca8-ae52-11de-8464-00144feabdc0.html

Three years ago we all thought this was imminent and I heard rumors there were talks, but that Cisco couldn't come to terms with TAA at the time.

What I think is possible different is that this might be a defensive move on Cisco's part. Silver Lake has long been known to be putting this deal to rest and to have merged together Avaya with Tandberg along with the peice they bought from Nortel into a company that go after Cisco.

Is Cisco the spoiler? or does this make sense? It certainly does. Tandberg products have always worked well with Cisco Call Manager. Sure, there is some overlap in product sets, but Cisco typically feels no remorse killing product lines. I think all of TAAs products work well..I can't see anything getting killed. But..who knows how that will line up.

Hiring?

I've been hearing rumors that everyone is looking at hiring plans for the next couple of quarters....and that alot of them have big numbers of new headcount.

I'm curious what the rest of you have been hearing. Please send me a note and let me know what you've been hearing!

New Cisco 1100

New Cisco TP System

http://www.cisco.com/en/US/products/ps10521/index.html

HP in the desktop vtc market

http://www.hpl.hp.com/news/2009/jul-sep/skyroom.html

TAA HD USB

I just heard from one of the videomonkey readers that the release code is out and many issues were fixed. URL is here: http://ftp.tandberg.com/pub/software/camera/cc1/

Tandberg HD USB Camera

While we're at it...I guess I will comment....since Wainhouse obviously isnt authoritative on the news they send out.

I've got one here and have been using it for the last two weeks. Fairly amazing is what I have to say. Optics are wonderful. Field of vision is very good. It has automatic focus and its fairly good. I had a few instances of where it strayed from my face (yeah..probably because I'm ugly)..but it corrected itself 1/2 second later. It has a built in microphone and pickup, noise suppression, and echo cancellation were very good. Of course, the new Movi software works really well. I tested between Movi systems and also out to legacy H.323 endpoints and I have yet to get that to fail.

The only thing I was not happy with and I haven't had time to delve into it was why I could not get inbound audio and video when I was behind a Polycom v2iu. Yeah..quite weird as Movi is SIP based and the v2iu should be seeing it as outbound originated traffic and it should traverse the v2iu. I actually had to hard code static nat statements to allow those ports inbound. Other firewalls....cheaper ones...had no issues and they traversed without any config changes. Not sure if the ALG engine on the v2iu was trying to do something with it...or the traversal logic in Movi was messed up.

But..getting back to the camera. It is heavy! Very heavy compared to regular webcams. It has this arm that you can position multiple ways and one way is to hang the camera on a lcd panel or a notebook lcd lid...but on a notebook, the camera is a bit heavy. But..the stand works really well for placing the camera on a flat surface and with the autofocus makes placement a breeze.

And one other issue...and I really don't have the tools to prove this..but the picture I see locally does not look like 720p. Now...for all fairness, the drivers are beta drivers, so I guess we'll see as things are tweaked and improved.

Ok, I'm not perfect, but...

I just got to know. If you think Wainhouse sucks, raise your hand! (or post a comment) I certainly was not an english major...and sometimes my writing comes off as rather tart, but... man, I don't think they put any thought into what they write. Its certainly pretty biased reporting..and a ton of self promotion. Like..how many times have you opened up an issue of their newsletter and saw a picture of Wainhouse staff? Yeah..like every issue. Sorry, just had to get that out of my system. I've been meaning to say that publicly for about 6 years. I just opened up todays issue and they had a one liner about the new Tandberg HD USB camera...you could tell from the sparseness of information and the lack of knowledge like "...claims that we have not yet been able to verify include high quality glass optics...".

C'mon. Do you guys just read websites and regurgitate information? or do you actually dive in?

Andy

Maybe you know this rumor...maybe you don't. It was fairly rumored that Andy made it part of the terms of his offer that if Bob was going to suceed the CEO position, that Andy was guarranteed the spot. I also originally heard that it took 2 extra months to come to this agreement..otherwise Andy would have been their earlier. But... what maybe you didn't hear was that Bob is intending to step down a lot sooner than later...potentially by the end of this calendar year.

Today's PLCM 8K

Short and sweet:

"On August 14, 2009, Polycom, Inc. (the “Company”) committed to a restructuring plan to realign and reinvest resources in the strategic growth areas of the business. The Company is eliminating those positions that are not aligned with the go-to-market structure under our new sales leadership and reallocating resources to growth areas. The plan includes elimination of approximately three percent of the Company’s global workforce, with most of these reductions taking effect immediately. The Company currently expects to record restructuring charges resulting from these actions totaling between approximately $5 million and $6 million in the third quarter of 2009, which amounts will be paid in cash through the second quarter of 2010. These charges and payments primarily relate to severance and other employee termination benefits."

So, maybe 60 people or so were let go. I did hear that severance in this round was pretty good...a year of pay. Of course..some that were let go were there for years and years. Of the 9 I heard of in the US, at least three of them had been at the company for over 10 years each.

Polycom Sales Reorg

As predicted (I cant claim too much credit, i think it was painfully obvious), Polycom as reorged their sales group. Reorgs are painful, at the people level, and I know at least seven who were let go within the US. But, at a company level, this is potentially good news. First, because Polycom is uniting multiple sales groups into a unified group and I've heard that one salesperson will work an account, whether its a voice opportunity or a video opportunity. Second, at least for the US, they are getting a solid VP, Jack Shemavon who successfully turned Canada around. The Canada story is a good one as Polycom had almost lost the entire country, and at one point, there were zero employees. It started out with just Jack and one SE for the entire country. They were systematic and fully focused and they kicked TAAs butt. Jack will bring that single minded focus to the US.

I have not heard yet what happened in AsiaPac or EMEA yet..but I would expect tweaks to their organizations.

Here's the key to all of this. Polycom has to execute this and stick with the plan. They're not good at keeping with plans..and tire of them quickly.

Also, Polycom has to keep working on its portfolio. I think they have to do two things. Keep the focus on strengthening their enterprise platform. They have a good start..but it needs to improve. One desperate area that needs to improve is out their telepresence systems integrate with the rest of the portfolio. It is honestly, horrible. Sorry, but using Crestron code to create a telepresence system is not the right answer. Also, Polycom needs to immediately hire engineers that are good at reducing COGS on their products. This will increase margin...but, it will also allow them to compete at the lower end..the value end of the market. That is the end of the market that is growing quickly. If I was them..I would also immediately eliminate all non-HD products.

It could be a good time for Polycom. I personally think it would be interesting working there..and quite exciting as there is renewed focus... most importantly.. an aggressively managed sales team.

Cash for Video?

Barack,
Cash for Clunkers... interesting program. Many think its a great program. I'd have to say, the way its structured is totally debatable.

But..really...whats your agenda? Is it to spur the economy? is it to yet again help the auto makers? or is it to help the environment?

I say, lets take $1B (heck, to government types $1B is chump change) and lets to a Cash for Video program. $4500 per video conferencing room as an immediate refund right from the US government. I tell you Barack, it would be enormous ROI for everyone involved.

Let me throw some math your way. If I have a car that gets 18mpg and I upgrade to one that gets 36mpg and lets say I drive 10K miles per year and lets assume gas at $3 per gallon. At 18mpg, its 555 gallons or $1666 per year. Double the gas mileage and I'm at 277 gallons per year or $833 per year. Its a savings of $833 per year.

But, give me $4500 to build a video conferencing room and if I just use it one day per week for one meeting with 8 people. Lets say its a regional busines and we drive to meetings. If its 8 people and say 100 miles each, its 800 miles a week. Do that meeting 50x a year and we're at 40,000 miles. Say we're still drivig 18mpg cars..thats $6666 of gas. Even if we have 36mpg cars...that $3333 of gas per year. That makes my savings 400% greater than the cash for clunkers program. And thats all from just one meeting held weekly.

Imagine if we were uniting people cross country? What if we were having multiple meetings per week? The ROI just increases. The decrease in the amount of energy use. And not to mention the amount of CO2 produced.

Barack, you're certainly the most hip and trendy President I've seen..and you're certainly the most technological. This should be a no brainer. Or..I know you like to play basketball...that makes it an easy lay up.

Lets spend tax dollars wisely.

jeff

Andy Miller

I've only heard a few things so far about Andy. Mostly that he's been spending time figuring out the company. I know that down in the trenches... there have been a lot of what ifs. There are some that are just tired of the every two year sales team shakeups. But..I did talk to a mid level sales manager that so far wasn't concerned at all.

Whatever the sentiment of everyone is, if Andy is going to deliver for the board and the stockholders, he's going to have to formulate a plan and start to execute. I'm sure that part of that plan is going to changing out of mid to high level sales management. It might even mean re-organization

I suspect it will happen pretty soon. The last sales SVP kept his first major changes to 1 year in..and then the second set at 2 years in. I honestly believe that the best course is to make your changes immediately as you then have the most amount of time to execute.

But..the problem also comes with the fact that most Polycom customers feel that Polycom is a revolving door. They either have not seen their sales rep in years... or their sales rep changes every six months.

Criticism, Cyncism, and or just spitefulness

I just want to set the record straight... I'm not a cynic and I'm not spiteful. I hope the best for the entire UC industry. All of them..including Polycom. I'll have to agree...lately I've had a lot of barbs for Polycom. Its not emotion... its just honest criticism.

And its exactly what Polycom and the others need. Too many people get emotional about business... about the companies..about the products. I learned long ago with Novell, that people actualy get product religion. And anything you say bad about their "company"; you either are the enemy or you just dont get it.

Bad things I say against Polycom...are really.. wow...look at this problem, here's how it could have been handled differently..and here's how they could have succeeded.

The UC industry has been an industry of ups and downs. Look at PictureTel. If the right people would have been involved, if the right people could have made suggestions, if the right people would have listened...that company would still be in business and might have turned into the "Cisco" of the UC industry. But..all those things didn't happen and look what occured.. they died and the carcass was bought by Polycom. It was all avoidable.

Thats partly why this blog is here.

Economic Tidbit

This has nothing to do with video...but I thought it was interesting.

I was in Eastern Montana about a week ago..driving back home... and the railroad tracks paralleled the road. For nearly five miles there were parked cars. Not a train sitting...but cars in storage. 3-4 miles were just multi-modal cars..and then a mile or so of bulk material cars (grain, sand, whatever).

I had heard alot of mothballled planes...I get that one... but I was amazed to see rail cars and so many. there had to be thousands of them. The answer I guess is the US is consuming a lot less and less is being shipped.

Definitely a very leading indicator is when they put these cars back into service.

Rumors still flying about TAA

Confirmation of some of my earlier posts:

http://ftalphaville.ft.com/blog/2009/07/16/62456/silver-lake-swooping-for-tandberg/

Silver Lake as well as TPG would certiainly make the most sense as potential acquriers. And I still think an interesting combo would be Avaya + TAA. I'm not talking the NBA dream team here...but more of..hey, those are the peices available and they do fit.

Lets keep watching and I'll certainly share all I hear.

BTW...I have also heard further rumblings about PLCM being bought. Maybe the HP rumor I started might come true. Or...maybe the Cisco giant will wake up and do something? (although they're busying laying off peole this week)

It would explain the sudden rise in PLCM share price lately.

Q2: TAA vs. PLCM

TAA continues to outmaneuver its leading competitor PLCM

Revenue of $204.5MUSD which is 5% y/y growth

Profit of $43MUSD which is 4.3% y/y growth

This is particularily interesting a iIn 2Q09, TANDBERG sold 15,663 endpoint units compared with 16,483 endpoint units in the same quarter last year, a 5% year-on-year decrease (a 4% increase excluding OEM units). Revenue from network products grew 25%, and service revenues grew 22% year-on-year. They grew the business while selling less units...which means their focus on infrastrucutre and upselling is working.

Polycom on the other hand

Revenue of $230M which is a negative 15% y/y growth

Profit of $15.3M which is a negative 15% y/y growth

--  70 percent video solutions, or $161.7 million (56 percent video     communications, or $128.7 million, and 14 percent network systems, or $33.0     million); and --  30 percent voice communications, or $69.0 million.

I was too busy yesterday to catch the earnings call..so I don't have the # of endpoints sold.

which...who makes AP headlines like "Polycom shares climb after strong 2Q results" ??? Sure, they beat their forecast...but thats such old school logic and so manipulative. Its so unfortunate that you can see PLCM slowly dying.

World's biggest NON-secret revealed...

I think we all knew this... Any Miller is going to Polycom

http://www.polycom.com/company/news_room/press_releases/2009/20090701.html

I heard about this 3-4 months ago that this was in the works... it pretty much hit crescendo two weeks ago at Infocomm. Where...just about everyone was joking around about it.

So, what does it mean for Polycom? Not sure. Andy certainly is a hard charger. but..will he get the support behind him from Mike & Bob and the patience from Mike & Bob. That has been the killer of all people before him. Its not like David or Kim were not hard chargers either. Both were passionate and very smart and dedicated... they both had plans on where to move the sales organization and what they needed out of the rest of the company to make it happen. But...they only received partial support.

So... Andy starts on the job soon... but, unfortunately for Andy, his timer also started up and he probably has 24 months before the rumors of him leaving start to surface. I really don't think it matters how good or how bad he performs... past lessons say that his expiration date label has already been printed.

Tandberg C20

I was at Infocomm this week and saw the new Tandberg C20.

Damn! Its a sweet looking system. 1080P, NPP, Dual display.

The unit is soooo small....so slim...you could easily hang it on the back of the plasma and never find it again. The microphones are sooo small... i would guess you coudl stack three of them and be equal in height the plcm hdx mics. talk about making a conference table look neater.

Tandberg is absolutely putting their foot on the gas and showing that they are the market leader.

Its amazing how fast Tandberg pulled from being half the size of Polycom to somewhat larger in such a small amount of time.

Big yawn

This came out today:

http://www.polycom.com/products/telepresence_video/telepresence_solutions/room_telepresence/hdx6000.html

If you were at Infocomm and you walked into other people's booths...everyone was showing new 1080P products... or if it was a 720P product, it was a desktop PC based system.

I know I must come off as really beating on Polycom...its not personal.. they just seem to make the weirdest product decisions for the last few years.

$6K for a 720P system? When TAA just came out with a $8K 1080P system. Or I could buy Lifesize Express 200 for $7K?

The other thing that just kills me...and I was saying this internally 2 years ago.. you can't call this stuff telepresence. If you do...you'll water down the market... you'll kill your ability to sell RPX and especially TPX.

It reminds me how when you walk into a PLCM demo center that you often find a HDX not far away from the TPX or RPX room. Honestly... when you get down to it... PLCM is really saying... hey, I'll sell you one really expensive conference table and I'l throw in the codecs for free. Besides..the system looks like it came from IKEA.

If you're reading this and you work for PLCM...this is not me negative...its tough love. You need to focus on what customers are going to make decisions on and they are making decisions based on what the competition is offering. You've got to have a different value add...and you've got to start acting like a industry leader if you're ever going to claw your way back to that position. At this point...if PLCM doesn't start acting aggressively, they soon will be the #3 in the market behind Lifesize and Tandberg. PLCM can do it... you stil have some smart people working there.. don't stymie their creativeness!!!!

More forced PTOs

I'm not sure how Polycom is going to keep their customers happy if their employees are always on PTO. I sent some emails to people today and most got this automated response:

"I'm currently Out of Office - On PTO- June 15th through June 18th -If immediate assitance is required please email..."

"I will be out of the office until Tuesday, June 16th, and will respond to email when I return. "

"I am out of the office on Monday June 15, returning on Tuesday June 16. During this time, I will have limited access to email or vmail. If you need immediate assistance, please contact"

"I am out of the office until June 22nd with limited email. "

Besides the fact that most employees are out of PTO?????

today's polycom 8k

http://phoenix.corporate-ir.net/phoenix.zhtml?c=112660&p=irol-SECText&TEXT=aHR0cDovL2NjYm4uMTBrd2l6YXJkLmNvbS94bWwvZmlsaW5nLnhtbD9yZXBvPXRlbmsmaXBhZ2U9NjM1NTg5NyZhdHRhY2g9T04mc1hCUkw9MQ%3d%3d

Nothing overly interesting... just changes to stock compensation plan.

Its my blog and I can create rumors if I want to...

So, for those of you that paid attention to HP's annoucements last week:

http://www.hp.com/hpinfo/newsroom/press/2009/090519xa.html

It does sound like a potentially good match and certainly a hot area for HP to be investing in.  MS has the software, but no hardware.  HP vice versa.  

The key part of what I got out of the press release (and the keynote at Interop) was that HP very briefly said "ip phones".  Now...they don't have any IP phones right now.  Sure..they have many PCs that could run the OCS client.  They also have their lines of PDA/cell phones that certain could run the client... but they don't have hardware based phones. Yes..those things that most companies prefer to put on the desks of their employees.  Should they build or buy?

For that matter... HP does have telepresence...but its proprietary.  They also have a partnership with Tandberg.  

But...if you're HP and you want to accelerate your strategy and you also want to create a business that is based in the US..and maybe even specifically in one or two states where you own a lot of real estate. (HP is big in TX and CA)... you might consider buying. Who would you buy?  Tandberg?  nope...too much complexity with them being out of Norway.  Lifesize?  No... they're mostly a video company and havent been overly successful with their one ip phone.  Sony, Aethra... no.  Which leads us to Polycom.  

Think of it.  They bring:  video endpoints, an open standards telepresence, and..the big one... ip phones.  They have offices in CA & TX.  They have good ties with MS...in fact they bought Roundtable from MS a few months ago.  And...as far as I know... Polycom wants badly to be sold.  Mike & Bob have been trying to sell the company for years...and even though I was never in the "know"... from what I heard was that every deal they had in front of them...they didn't feel like the deal was rich enough. Now...I think they're tired and they want to move on.  Polycom is a rollercoaster and I think its ran out of steam.  It needs to be bought and this is the right time and the right company.

Which brings me to the next rumor I'll start... that this buy will create a round of other buys.  CSCO will then turn and buy LS.  And then some telecom provider will go buy TAA.  Maybe Nokia, maybe Avaya, maybe Siemens.   Next rumor... Sony will do something different with their Spire Global experiment.   And... Aethra... who knows... maybe a merger for them. 

This is the right time for mass consolidation and for true UC to start.

Soundstation 2W problems

Hey,

I know this isnt video related...but I'm wondering how many of you have had SoundStation 2W systems that have stopped registering to the base.  I have (2) and I have heard of other people in the same boat.  

I wondering if this is a larger problem and if Polycom should address it. 

http://www.fixya.com/support/t405331-registration

if you've heard of anything...please let me know.

Q2 Updates & Reseller Consolidation?

Well... I'm getting a mixed picture from various folks I'm talking to abou the quarter. It seems that April was the low of the low for most a/v & vtc companies.   

I think its pretty clear that some companies have stopped buying... but there are other companies that are buying as they need to curb on travel costs.  All companies I talk to definitely mention little or no travel.  That is good for the industry.

As its been joked about in the financial press..   "flat" is the new growth.

So..which leads me to wonder.  Where will there be consolidation?  I'm thinking that its going to be on the reseller side.  Bigger resellers are more efficient. They're easy to put together and give immediate roi.  Could it be some of the regional players?  There are some that are good at covering say the west...but don't have the east...and other combinations. I wont name names...that would start a rumor.  I really haven't heard anything... but if I was reseller and could either pull off a merger of equals... or if I had the cash facilities, I'd  be buying.

Regus kicks out CSCO, puts in PLCM

You read it and make up your mind yourself...

http://www.networkworld.com/news/2009/050509-regus-picks-polycom-for-telepresence.html

I think this is one peice of news thats not worth me commenting on publicly
(I've had past experience with Regus and was involved years ago in convincing them to go PLCM)

TAA ships more EPs then PLCM

I think If I read the numbers correctly, TAA for the first time shipped more video endpoints than Polycom did in a quarter.

Should be interesting to see what happens this next quarter...

polycom 10q

i haven't read it yet...

http://phoenix.corporate-ir.net/phoenix.zhtml?c=112660&p=irol-SECText&TEXT=aHR0cDovL2NjYm4uMTBrd2l6YXJkLmNvbS94bWwvZmlsaW5nLnhtbD9yZXBvPXRlbmsmaXBhZ2U9NjI5MzY3NiZhdHRhY2g9T04mc1hCUkw9MQ%3d%3d

they're happy!

I've recently had quite a few conversations with PLCM folks...and one word for all of them...

happy

I'm  not sure if its just good drugs or they really feel like things are looking good.  I repeatedly heard from many that they thought that PLCM products were finally shaping up and could provide a solution that would compete well with what taa & ls was putting out.

Lets hope for their survival its the later, not the former.

PLCM TVS & VSG Merge

Just recently Polycom decided to merge the Telepresence Video Solutions group and the Video Solutions Group.

I looked but could not find any press releases.

First thing that makes me wonder is why?  Of course, one good reason would be that telepresence sales suck and PLCM wants to hide those numbers.  The other is quite a good one too...  reduce some headcount by getting rid of redundant bodies.  I was told the reason was that it was to get the technical groups more aligned.  (nice idea...but honestly I don't believe it).  My guess is its both of my first guesses.  

I have said privately that the start of the slipperly slope with telepresence with Polycom and probably others was when PLCM started saying to press that they've shipped 10s of thousands of TP systems.  Which...if you explore the math means that they counted anything HD as being telepresence.  Sure..from a market share prespective that re-definition would make PLCM #1...but unfortunately it back fires from a customer marketing point of view.  

yes, Mr. customer you can buy this "telepresense" for $15K and this other one for $300K... hmm...wonder where I'll spend my money.  and yes, this it not my theory...its pretty much truth.  PLCM futher blundered by actually having HD demo rooms right next to telepresence rooms... they purposely would short change sales and leave money on the table.  

If you have a problem with some of these statements...its not me... take a look at PLCM's numbers. They're pretty terrible and show the mistakes they've made.

TAA Earnings Announcement

Topline growth of 8% USD $193M
NET growth of roughly 9% USD $40.8M

Network infrastructure growth of 47% y/y

video endpoints is 66% of their business
network is 22% of their business
the rest is services

they did see some weakness in enterprise sales.

they plan announcements in the future with telepresence federation

Cisco April Layoffs

Cisco has just RIF'ed about 650 worldwide...of which 450 were here in the US. From several people I've talked to, in the US it was mostly people in the Select Sales Regions. They eliminated that entire tier of sales group. I would expect the customers they managed either moved to Enterprise or down to territory account managers.

From what I was told is that its not all bad news for those effected... they are all being given two months to find another job within Cisco before being let go. I've been told that there are open positions available... for home many, who knows?

Man..it hurts

y/y down $6M of video systems
y/y up $3M for network systems
y/y down $30M for voice (thats -30%!!!)

I love Bob's quote:

“Although we experienced the challenges of the current economic environment in the first quarter, we believe the core drivers of our business remain strong,” said Robert Hagerty, Polycom chairman and CEO. “Now, more than ever, our customers are sensitive to discretionary spending and are increasingly focused on solutions that drive a hard-dollar return on investment (ROI) to improve their bottom line

I think maybe he's getting what i've blogged about earlier last year that customers want value priced solutions that have quicker ROIs.

Something interesting he mentioned was his excitement about the Polycom CX5000:

http://response.polycom.com/forms/SearchRegForm_CX5000InfoPack

For those not in the know, this is the Microsoft Roundtable. I really cant believe that PLCM was gullible enough to get saddled with this product. It took MS years to develop and no one wants it. What a waste of time/effort/money on PLCMs part to take this product on!

should be interesting to see what TAA posts...I don't expect it to be very good. Too bad LS is not public, I'd love to see how big their growth really is.

Polycom earnings

http://phoenix.corporate-ir.net/phoenix.zhtml?c=112660&p=irol-SECText&TEXT=aHR0cDovL2NjYm4uMTBrd2l6YXJkLmNvbS94bWwvZmlsaW5nLnhtbD9yZXBvPXRlbmsmaXBhZ2U9NjI2ODI2MyZhdHRhY2g9T04mc1hCUkw9MQ%3d%3d

April 8k Statement

On March 30, 2009, Polycom, Inc. (“Polycom” or the “Company”) entered into a Transition Agreement with David R. Phillips, the Company’s former head of Worldwide Sales (the “Transition Agreement.”) Pursuant to the terms of the Transition Agreement, Mr. Phillips’ employment with Polycom terminated on March 31, 2009. Mr. Phillips has agreed to non-competition and non-solicitation provisions for a period of one year following the termination of his employment. As consideration for Mr. Phillips’ execution and non-revocation of the legal release of claims set forth in the Transition Agreement and for the non-competition and non-solicitation provisions described above, Mr. Phillips will receive the following from Polycom: (1) a severance payment in the amount of $427,500, less applicable withholdings, payable in two installments of $320,625 on October 15, 2009 and $106,875 on April 1, 2010, upon the expiration of Mr. Phillips’ non-competition and non-solicitation obligations; (2) outplacement services for a period of six months, which are valued at approximately $6,000; (3) Company-paid COBRA insurance premiums for a period of twelve months, provided that Mr. Phillips timely elects such continuation coverage, which are valued at approximately $19,400; and (4) retention of Mr. Phillips’ Polycom-issued mobile phone, assigned telephone number, PDA and laptop computer. In addition, Polycom has agreed to reimburse Mr. Phillips for legal fees of up to $10,000. Pursuant to the terms of the Transition Agreement, in order to assist with transitioning the Company’s worldwide sales operations, Mr. Phillips worked on a part-time basis for the Company from February 17, 2009 to March 31, 2009. (that equates to about $17K for five weeks)

Not a bad deal. I am still so amazed at the amount of money Bob/Mike spend on "sales experiments". David was there approximately two years. Of which he was paid at least $700K in base pay..not sure as to how much bonus he received...and he received at least 100K shares of PLCM stock. So..my guess is all in all probably $2M investement and they didn't let it all play out. And...then on top of that... the fact that David axed several top people that not only were over performers but had been overperforming for several years at PLCM... I'm sorry, but it equalled a giant loss. Not only did they not let David move the ball forward... with all of his changes...he actually moved it backwards.

Cisco

Ok, its slightly old news...but...

http://www.cisco.com/en/US/products/ps10340/index.html

Nice looking product.  It looks squarely like a standard video conferencing system.  Only issue is that list price is $89K.  But...all you have to do is breath and Cisco gives you a monster discount.  I'm not in the market for one myself.... hey..my Tandberg 880MXP connected up to a 26" LCD works well for me... but if I was I suspect you could buy one for $51k. Not bad...but I could do better to buy a Lifesize C200 and a 65" plasma from Costco and probably save $30+k.

So...here's the question... Cisco is not dumb. (but I will say that their overall IQ has been dropping steadily since I left)  but..when are they going to shake up the market?  It truly seems that the market has gone towards value pricing.  If Cisco is serious about doing $1B in sales, they are going to have to get price competitive.

PLCM Q2 and that state of everything else...

So, the buzz in the analyst community is how well PLCM is going to do this quarter.  Some PLCM sales people are quite happy with their numbers.  My personal take... a lot of people got haircuts on their quota and they're quite happy.

Overall, what do I think based on talking to lots of people?  PLCM is losing market share like a cancer patient is losing hair.  Its ugly.  

LS & Sony are winning deals with customers switching to value plays.  Talks with resellers in the refurbished market are making a killing selling used TAA & PLCM.  don't belive me?  Google refurbished polycom or tandberg.  Or... just look on Ebay.  The market for used gear is rich.  Customers who dont want to buy LS are buying more and more used gear.  One reseller told me they have an outstanding order for 200 USED 990MXPs from just one customer.  Thats a lot of revenue not flowing to fulfill someones quota.

Rumors from two weeks ago...

I meant to post this and didn't. So...just for historical reference....

I've heard rumors that HP might be interested in buying Tandberg...or at least they are doing some due-dilligence.

Being that HP now has lots of TAA demo equipment... including a TAA telepresence system... it makes for interesting counterpoint to Halo.

who knows...we'll see.  

Yawn....

Sorry for the long lapse. I've been busy and honestly I was kind of weirded out when I talked to a ex-coworker a few weeks ago and he had mentioned that my name comes up often in the office and not for past work accomplishments...but comments about my blog.  

When I started this blog...it really was to talk about pro-polycom arguments and to hightlight where the competition was playing with the truth. But... times have changed and with that my viewpoint on where to take the blog. The last few months have been mroe about an unbiased viewpoint...and one with street smart sense.  

Honestly that means that at times (and a lot recently), it has been filled with viewpoints that are not exactly pro-polycom.  Not because I don't like them...but if you're unbiased then unfortunately anyone can be praised and anyone can be dressed down.  Sorry.  Nothing in here is intended to be personal

Stefan's blog

My friend and ex-colleague at PLCM has just started up a new blog...check it out

http://videonetworker.blogspot.com/

Yet another SVP of sales gone at PLCM

http://phoenix.corporate-ir.net/phoenix.zhtml?c=112660&p=irol-SECText&TEXT=aHR0cDovL2NjYm4uMTBrd2l6YXJkLmNvbS94bWwvZmlsaW5nLnhtbD9yZXBvPXRlbmsmaXBhZ2U9NjExODE1MCZhdHRhY2g9T04mc1hCUkw9MQ%3d%3d

I suppose PLCM isnt different than a lot of other companies... changing the head of sales like they change clothing styles... but PLCM surely does have a track record of changing out Sales SVPs. David Phillips who was there (if I remember correctly), just slightly longer than 2 years is gone. There was a gap of almost a year where there was no one in the top spot and prior to that it was Kim Neidermann who ran it for about 2 years as well.

Its a tough job being a sales SVP...heck....about the only way to really make an impact is to probably make your hiring/firing decisions on the first day so you can move on to watching your strategy. David for example took a year to make his big changes and then he just had one year to make them work. Its really not enough time to work out a strategy and work it to success.

So...PLCM is literally without a SVP of Sales...although technically Bob Haggery is filling in for the job. Not a good position to be in right now. The market is changing...customers are shifting to value products... and there are tons of new competitors...and its a bad economy.

I really wont state in a public forum like this whether I liked David or not. But...I do have to say, having someone at the helm right now, whether they are good or bad, is just out of the question. I'm sure TAA, LS, CSCO, and everyone else is damn excited at the prospects.

The market numbers are going to be very telling over the next two quarters. I think you're going to see a lot of market share leave the PLCM slice of the pie.

Two ends of the spectrum

So..that was interesting... Last week TAA comes out with fairly high priced HD endpoint. And this week PLCM comes out with a 4CIF system.

I find this just weird...and its mostly weird around how two different companies with two different marketing and product dev groups can analyze the same market and come up with two different answers. Sure..thats good for consumers. And...my point isnt around how there can or cannot be different markets to service and how different business models are more tweaked towards one or the other.

Its really around, how, from my point of view in the US, how one would make a decision to go to market at this time with either strategy. The economy is down...businesses are spending less. They are certainly being more careful with their money... we hear this from both TAA & PLCM that sales cycles are lengthed. But...then we hear from LS that they did 150% y/y growth last year. I also heard from someone that the last six months of 2008 were even higher than 150%.

Ok..blah blah blah Jeff... you're going to say something like "value pricing is going to win". Ok...yep, thats what I'm going to say. I don't see how TAA's C60 is going to sell well as its priced way too high. I also dont seee how the new Polycom QDX 6000 released today will help either.
Sure... its at a nice price point; USD $4000. But...is 4CIF (aka SD). It also has some other weirdities like a VSX remote and what looks like analog Soundstation microphones. It looks like a hopped up VSX 7000e. Ok..all that is cool... but if I'm in a value priced market, why would I pay $4K for a 4CIF system when I can pay slightly more and get a LS 720P system.

Or as I was saying to my friend DK, why not go buy a used system. It seems there is a lot of used gear on the market and if I'm really saving money, why not track down a used MXP or VSX. Right? Why would I want to a buy a new 4CIF system? I'm either going to make a more permanent investement with 720P or why not save money and go used.

I'm not sure. Anyone else have thoughts they want to share?

Tandberg c60

So... question for all of you... anyone out there own a c90? I'm curious if much of any of them have been shipped. Last I talked to a wide group of people I had not even heard that anyone had received one. Curious...

But..this seems interesting. Where is TAA going with their products? Sure, the c60 is smaller and a bit cheaper than the C90..but its not even in the same ballpark as products from Polycom and certainly from Lifesize. I truly believe that the market is expanding in the "value" segment. And LS certainly has hit the mark. And especially in a down economy, I'd rather be gaining market share than gaining margin....with the goal of erupting out of the economic slump ready to move up stream.

TAA certainly risks not selling many of either the C60 or C90 and not being able to position themselves for lower prices in the market with what I assume might be a C30 or C10 in the future. I say its a risky bet on their part to not put out a product that the market can afford to buy. I haven't technically evaluated either... I'm sure its a good product. I honestly like the UI and the OS of TAA systems. Clean, simple, easy to use. But...when you have a budget, you buy what you can buy. My guess is that if you're a TAA shop, you're either sticking with MXP or you're considering Lifesize for new purchases.

LS has greater than life size results

They are kicking but and claim 150% y/y growth which is phenomenal..especially with the economy the way it is.

As I've said before in posts and in conversations with some of you... Lifesize's value pricing of HD is brining in lots of greenfield customers and really rings true in this economic landscape.

http://www.lifesize.com/pr.php?prid=129

PLCM results

Not really much to say about the PLCM results. For those of you who read my blog or know me... this was all expected.

But... couple of interesting tidbits...

Of the 6% or 150 laid off, 40 were in Petach Tikva. The other 110 were mostly in Boulder. Boulder is where Spectralink used to hq'd out of. Now... at first blush you might think, well... voice is doing terrible. And that is part of the truth. Wireless phones are mostly used in distribution and retail which is a battered sector. And...maybe Spectralink had way too many sales/sales engineers chasing too little revenue. I really think that is true too. And lastly... what is PLCM good at? Well...they unfortunatley buy a company and they seem to lose the human capital fairly quickly. If you look at the current PLCM employee base... the amount of original Accord employee has dwindled, the amount of PCTL employees is minor fraction, the ViaVideo execs all disappeared (and went to form Lifesize), and there's almost no-one left over from Voyant.

On another note... did you notice that PLCM dropped pricing on the HDX 7001? Its down to $5995 and the EagleEye is down to $3499. Why did they do this? One reason...one company... Lifesize. Even though PLCM announced bad numbers.... LS seems to be doing fine based on the channel checks I've done. And they're doing it based on value pricing. Get a HD Lifesize for the same price that PLCM was selling VSX 7000 (note...CIF based system). Now, with the lower priced HDX 7001, they can now compete on price. The market has really turned and it seems that LS is calling the shots.

Nothing interesting

Well...its q1 and its nose to the grindstone time. So, not much time to blog..but I did get a url emailed to me just yesterday that I wanted to share. Its not really interesting unless you're a CCIE.

SO...here's to self-glorification... lol...

http://cciehof.wordpress.com/

John wants more video in 2009

In Chamber's speech at CES he says he expects to make a "stream of acquisitions" with a particular focus on video.


http://www.enterpriseitplanet.com/breakingnews/article.php/3795026

So..the question comes, will this be video conferencing orientated? or more consumer orientated. or both? not sure...but I do know from talking to folks at CSCO that they have a LOT of staff focused on telepresence. And we all know that the true telepresence market is really not that big. Cisco claims 500 systems.... but I know that most of those are at customer sites. I also know that PLCM has sold just 150 of their RPX. So..really... CSCO has a ton of people selling a very expensive product that few will buy at a time when few are going to spend the money. So... they are going to need lower cost products. They need to move into the bread and butter of the market which is normal video conferencing rooms. And...I'm sure...and they've said they will move into the consumer market. With Linksys, they definitely have the maufacturing and channel knowledge to create a consumer hardware based VTC product and be successful at it.

We'll see...

But... in the back of my head..I'm still trying to see if there was any deeper meaning to Mike & Bob @ PLCM making changes to the golden parachutes. Could CSCO be at play for PLCM? They had wanted to buy them prior... and if PLCM dumps their NSD products and becomes an endpoint only company (phones + vtc), i think the marriage could be pretty good. (at least from a product perspective)

PLCM lays off 150 & preannounces earnings

I love 8Ks...

http://phoenix.corporate-ir.net/phoenix.zhtml?c=112660&p=irol-SECText&TEXT=aHR0cDovL2NjYm4uMTBrd2l6YXJkLmNvbS94bWwvZmlsaW5nLnhtbD9yZXBvPXRlbmsmaXBhZ2U9NjA1OTg3OSZhdHRhY2g9T04mc1hCUkw9MQ%3d%3d

Essentially PLCM is laying off 150 or 6% of its workforce and has pre-announced earnings. I'm not sure what they had led analysts to before so I'm not sure if this is above or below the previous range. My guess is that it is below.

Most PLCM employees took a 2 week leave of absence at the end of year in 2008. (this never happened in the 5 years I was there). You know things are bad when sales and systems engineers take off for two weeks at the close of the fiscal year.

1/2 the answer

Well...this provides one half of the answer to the previous question:

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7b2A5765B7-4EF5-46A5-8618-B4988BFA5BB0%7d&siteid=nbkh

PLCM in Israel

http://www.globes.co.il/serveen/globes/docview.asp?did=1000413446&fid=942

Quote

"I cant tell you the formula for success.. but I can tell you the formula for failure... try to please everyone."