Avaya's shift towards a cloud model will be even more difficult now it is a public company, according to Mitel's global sales boss, who claims that the rival comms vendor's perception in the market has not improved since it exited Chapter 11 last year.
Todd Abbott told Channelnomics Europe at Mitel's Mitel Next event in Munich that most of its competitors have not successfully developed an effective cloud solution.
"[Avaya's] hardware business declined by 17 per cent last quarter so, fundamentally, most of their revenues are coming from maintenance. They haven't made the shift [to cloud]. They should have made the shift as a private company; making it as a public company is even harder. And they don't have a cloud. Are they going to acquire, or are they going to organically develop?," he said.
"Is it too late, is really the question. Onsite business is declining six to eight per cent every year while cloud business is growing by 22 per cent. If you don't get in soon, you'll be left behind. This is the problem with disruptive technologies. The legacy technology players always wait until it is too late - that's why they don't survive."
Mitel claims it holds the number-two spot globally in the unified-communications-as-a-service (UCaaS)space, second to comms vendor RingCentral.
Other competition comes from 8x8 in the SMB space, then from the likes of Microsoft, Avaya and Cisco among larger enterprise customers.
"All our competitors - Avaya, Unify - don't have an opex offering. [That] is because it's really hard to make that shift from a capex to a monthly revenue stream. We have already made that shift. Close to 25 per cent of our business is on UCaaS monthly recurring revenue. And we are adding seats at the same rate as the number-one player," he said.
Mitel launched a Move to Mitel scheme last year, targeting resellers looking for an alternative after Avaya filed for Chapter 11.
According to Abbott, the scheme has been a big success.
"Seventy-five per cent of our cloud business comes from new customers. So where are they coming from? Avaya, Cisco, a lot of those others," he said.
Avaya defended its cloud strategy soon after it floated on the NYSE in January. The firm launched its cloud division called Avaya Cloud, headed up by former IBM exec Mercer Rowe.
Avaya's CEO Jim Chirico said in a recent interview with CRN that the vendor would be aggressively focused on growth following its return to the New York Stock Exchange.
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