Avaya and RingCentral – is this the end for the IP Office phone system (PBX)?

Last week, we published an article on the future of Avaya and the possible merger or acquisition by Mitel. The day following our post, literally, Avaya published a press release announcing that it was not Mitel, but rather RingCentral that would make a major investment of US$500M in its company. This alliance may, however, be a sign that the popular phone system (PBX) IP Office may be near its end of life. Explanations.

Avaya has been losing its market position for a number of years. Hosted unified communications solutions are gaining market share quarter after quarter. A recent study from Nemertes Research indicates that 64% of organizations use hosted telecommunication services in one of many variations. Furthermore, of the 34% that use premise-based solutions or PBX, 43% of them consider migrating towards the cloud.

Considering this shifting market, it is very understandable that Avaya has been actively seeking a new financial partner in order to avoid another bankruptcy protection procedure.

However, and according to initial information gathered, this investment may announce the end of the IP Office phone system. Indeed, RingCentral and Avaya have announced “Avaya Cloud Office”, a rebranding of the existing RingCentral service that is targeted to replace IP Office.

It is thus clear that the IP Office phone system will no longer receive major updates. Its end of life should be announced sometime in 2020.

This new situation puts even more pressure on the current IP Office users. Not only must they consider a migration path to a hosted unified communications solution, but they now must also cope with the soon-to-be-announced IP Office end of life status.

There nonetheless exists one positive sign out of this story. If some still doubted that hosted unified communications solutions were not a “thing”, they should now be convinced that it is the “real thing”. Are you worried about the operational risks that this situation creates for your organization? Are you curious to learn more about hosted unified communications solutions and the benefits that they provide? We invite you to contact one of our senior advisors in order to have an honest discussion about hosted unified communications solutions.