VOICECON - Avaya reaching out to data center managers

While Avaya has seen a surge in its stock price and financial success in the past year, top executives Wednesday acknowledged that they have had trouble reaching IT data centre managers and executives at corporations to make important sales.

The challenge facing Avaya, a traditional voice-equipment vendor based in Basking Ridge, New Jersey, comes largely from Cisco Systems , said Don Peterson, CEO and chairman of Avaya. Cisco sells pure IP voice products, has an installed base of data switches and routers within IT organisations, and already has the ear of the data managers who control the IT spending purse strings, he said.

Peterson's comments came in comments to reporters and analysts at the VoiceCon 2004 show in Lake Buena Vista, Florida, Wednesday.

He said Avaya has been able to reach the managers in charge of voice systems, though they often aren't the same group as the data centre managers. Avaya sells products that include IP telephony equipment, but it also relies on traditional circuit-switched technology, known as time division multiplexing (TDM). As such, Avaya is in a camp of several vendors that sell hybrid systems of TDM and IP; Cisco is pure IP.

Peterson said Avaya doesn't have its salespeople "who make offers (to customers) sometimes because we don't have our people in front" of the correct buyers — namely, data managers.

But he vowed to find more ways to bring the Avaya message to data centre managers. "We're going to fight it out tooth and nail," he said.

Avaya sold more than 25 % of all voice-switching products in the US last year, leading all other vendors, including Cisco, which sold more than 10 %, said Allan Sulkin, president of TEQConsult Group in Hackensack, New Jersey Brampton, Ontario-based Nortel Networks was second, with more than 20 % of sales, he said.

Sulkin gave Avaya, as well as Cisco, a strong report in a roundup of voice vendors. But he said Avaya has been especially strong, with a stock price that jumped from US$1.50 per share to $18 per share in the past year.

Mike Thurk, group vice president for enterprise communications, said Avaya's strong financial performance is getting the company attention in financial publications, which in turn grabs the attention of top-level corporate buyers.

But Thurk also said a big requirement for Avaya sales teams is "getting in front of IT managers" to make proposals. Marketing needs to be focused on those buyers, too, he said. Pointing to some TV ads that include comedian Wayne Brady, Thurk said he has heard "vexed reactions" from viewers who don't understand references to IP and other terms.

Avaya has to decide "who is the target market" for the ads, he said.

Sulkin said difficulties in getting out the Avaya message can undermine its solid technology and services. "In a clear comparison with Avaya and Cisco, Cisco is going to lose," he said.

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