Microsoft takes aim at the telcos with new Skype for Business voice calling and conferencing features

The telephony sector is currently “undergoing a massive transformation” and that's down in part to Microsoft, according to the firm's general manager of worldwide productivity sales Eron Kelly, speaking to ComputerworldUK at the Microsoft Convergence EMEA conference.

A wide range of enterprise additions to the Skype for Business product were announced at the event last week. These are available at the premium enterprise E5 level and include the capability for traditional PSTN phone lines to dial straight into a Skype conference call. So whether video-enabled or traditional, offline callers can all dial into the same meeting.

Businesses can also operate all conference calling through Skype for Business in the cloud, instead of running a separate in-house PBX (Private Branch Exchange) system.

The ideal Microsoft office won’t even have phones on desks anymore, as voice services all move online. The hardware departments at the bigger telecommunication companies (telcos) may start to see the writing on the wall if this trend continues.

PSTN calling plans are currently only available in the US but will be rolled out worldwide. Kelly explains: “This is true, classic enterprise voice. I have a phone number, provided by Microsoft, I get unlimited minutes anywhere in the world as part of a service plan and now I’m 100 percent using the Microsoft cloud for all my communications.”

Naturally Microsoft has to work with the existing telephony networks which own and maintain the infrastructure, but this is invisible to the user as the phone numbers are served and hosted on Microsoft servers as part of their conferencing service.

Does Microsoft need the telcos?

When asked if this means Microsoft doesn't need telcos anymore, Kelly simply said: “Yes.”

On whether the telcos were potentially upset about this move, he was more conciliatory.

“They’re very aware,” Kelly explains, “our focus is on how we create the best integrated user experience that makes employees as productive as they can be. Telcos have different strategies, but ultimately there’s a strong partnership that’s required for both sides to be successful.”

Existing partners

Rival firm Cisco has an existing partnerships with Microsoft in areas like cloud and data integration, but they still compete in areas like collaboration, where Cisco has its own products like Jabber and WebEx.

Major UK telco Vodafone even offers an integrated Office 365 package for business customers which includes Skype for Business and Exchange but integrates with Vodafone phone services.

Both Cisco and Vodafone refused to comment on the impact these changes to Skype for Business will have on their businesses when contacted by ComputerworldUK.

Whereas traditional telecommunications revenue streams like long distance calling and monetising minutes are likely to shrink, the telcos still own the infrastructure. Kelly also sees value-added potential for telcos when it comes to specialised high speed MPLS networks.


In the end Microsoft won’t be able to operate entirely without the help of the telcos. Kelly calls it “the last mile,” as, unlike Google, Microsoft have no interest in laying telecom cables.

However they are happy to disrupt the way employees traditionally communicate through Skype for Business, and they could certainly claim a bigger piece of the pie as companies increasingly move into the cloud.

Copyright © 2015 IDG Communications, Inc.

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