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Cisco can’t win on price!!!

Posted by tggokul on November 3, 2007

I had a boss who used to boast that he has never lost a deal on price and I always used to wonder whether that was necessarily a good thing. And Cisco is facing that in the Indian markets currently.

I have reasonable knowledge of Cisco’s IP Telephony and IP Contact Center products ( purely at the voice layer and not data layer) and also on how low they can go on price after discounts. I have come across atleast two cases where our guys ( though we are primarily an contact center application development company, sometimes we do system integration as well) have quoted cisco solutions to small contact centers ( 10-15 agents) and even after discounts it is way higher than say an Avaya solution. They came back to me asking whether we can reduce it further and that is when I quoted the title of this post “Cisco can’t win on price”.

The next thing is then how do you convince customers to go for Cisco. Yes, Cisco is an infant in the Contact center space ( I will go a step further and say they are not exactly very mature when it comes to even IP Telephony namely IP PBX). But what is their selling point? I know what it is because I have felt the advantage but it is going to be very difficult to explain that to even the sales guy let alone the customer.

Last week, we were working on Cisco’s Customer Voice Portal (Cisco IVR based on VXML) and there was this unique problem where the VXML browser was not rendering media to the user even though the prompts were being queued at the browser level. Now my first logical thing would have been to suspect the browser ( which incidentally is the Voice gateway as well. Pretty neat stuff from Cisco; using their ingress gateway as VXML gateway) and probably even network congestion. After gazillion hours of work and even more cups of coffee, we finally figured that a database query through Webshere was taking a long time to return the resultset that caused this hogging. ( This might not be too clear a description. Feel free to leave a comment here if you are looking for further inputs on this issue).

The point I am trying to make here, applications and infrastructure are so inter-linked in the IP world that a problem in one can be manifested on the other. This is Cisco’s selling point. They control both. Avaya has no control on the data layer. Let’s say I had the same problem in Avaya IR or Avaya Voice Portal, the issue would have been tossed around between the infrastructure and the applications teams for months without any resolution. Cisco delivers one unified platform. Again good luck explaining this to your sales guy trying to meet his quartely numbers.

Fighting on price will decimate the market. It has happened to the IP PBX companies. We see a lot of them going belly up because of this. Cisco can’t and shouldn’t fight on price. They should fight on features, fight on unified applications, fight on unified management.

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3 Responses to “Cisco can’t win on price!!!”

  1. anonymous said

    Gokul,

    Fighting for a 10-15 seat contact center on price is ridiculous. Imagine the amount of time spent on sales cycle, implementation, deployment, maintenance, fixes etc to keep 15 agents happy!

    10-15 agent seat is better left to the Hosted guys. Such contact centers typically do not need wiz bang features like VXML, 2BCT etc.

  2. Novice said

    you seem to know very little about contact centre, Avaya will not compete with Cisco for a 10-15 agent seat contact centre. In Avaya’s Voice Portal environment the issue you stated would have been easily identified using either the trace mechanism or in-built logs, Avaya knows its weakness and works extrmely hard in segregating the issues. compared to features I guess Cisco is still catching up. I dont want to comment on the pricing, which varies from deal to deal, you can check that with any sales guy.

  3. tggokul said

    Novice,

    Hmmm, why do I get the feeling you are from Avaya :))

    Very curious to know where you are from. I don’t think you have any idea on what is going on at the ground level here in India. Avaya/Cisco are fighting tooth and nail for the 10-15 agent centers.I would strongly suggest you talk with the Avaya sales guys and probably look at their customers for the last one year.

    And I don’t think you comprehend the technical challenge I had mentioned about. Hence the superficial comment about “trace and inbuilt log”. Dude, real world is much more complex than looking at logs.

    Gokul

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