Hosted UC Alternatives for the SMB How to get more functionality and reduce your IT spend. Speaker: Frank Grillo, EVP of Marketing Cypress Communications

Cypress Communications: Leading provider of hosted UC Solutions Snapshot Headquarters: Atlanta, GA Sales and operational coverage throughout North America 20+ years of experience managing enterprise communications Product Portfolio Fully managed to desktop, Voice and Internet Services Managed Data Network Services Advanced IP Telephony Services Hosted unified communications (UC) Operates private network optimized for hosted UC Give some background on yourself and segue into background on Cypress. Building your credibility. Customers 6,000 customers and 60,000 handsets Over 12,000 hosted UC seats installed; projected to exceed 25,000 by end of 2009 Customers include SMBs and SMEs in technology, legal, commercial real estate, financial services, insurance, among others. © 2007 CYPRESS COMMUNICATIONS, INC. 2 © 2007 CYPRESS COMMUNICATIONS, INC. 2

Cypress Awards TMCNet Unified Communications Solution of the Year VON Innovator Award Frost & Sullivan Product Innovation Award for VoIP Business Continuity TMC Labs Innovation Award VAR Business 500 Technology Marketing Executive of the Year Communications Solution 2007 Product of the Year Excalibur Award for Technology Excellence INTERNET TELEPHONY Excellence Award Unified Communications Excellence Award Internet Telephony Magazine Product of the Year Frost & Sullivan Product Innovation Award for Hosted UC EVP of Marketing wins Voip-Biz.News' Person of the Year Association for Corporate Growth (ACG) Phoenix Award Unified Communications Magazine 2008 Product Of The Year Award TMC Next Generation Network Innovation Award Communications Solutions 2008 Product Of The Year Award 2009 Unified Communications TMC Labs Innovation Award 2009 Internet Telephony Magazine TMC Labs Innovation Award

New Paradigms for Communications Technology ownership is no longer a sure thing. IT asset ownership is a choice, not an obligation. Enterprises are embracing hosted delivery models — SaaS, cloud computing, LAN/WAN services, desktop management, business continuity and hosted UC. Wireline handsets will increasingly become historical relics facing a similar fate as fax machines and ashtrays. Wireless and soft phone functionality will be mainstream by 2010. Hosted IP voice services market will increase from $505 million in 2009 to $1.2 billion in 2012. Source: Gartner, Inc. and IDC

Unified Communications Integrated Communications voice, data & Internet voicemail, email and messaging video and application sharing audio, web and video conferencing ACD and contact center Phone, mobile and PC Enterprise Convergence networks and systems software and applications processes Real-time presence, VoIP and IM Collaboration team spaces, share files and desktops Centralized Control and Management Quick definition of unified communications.

Hosted Unified Communications All of the features of unified communications, plus… End-to-end solution: network, access, LAN, WAN, phones, routers, soft client, integration Custom-designed solution Network and equipment owned and managed by one provider Guaranteed voice quality, network availability Voice traffic prioritization Business continuity assurance with data failover and redundancy Project management User training and support

Key Drivers of Hosted UC Lower Costs No capital expense No ongoing maintenance costs Technology risk avoidance Lower operational expenses Economies of scaling Technology Management Business Continuity

Hosted UC Driver #1: No CapEx No capital purchase OpEx model Pay for only what you use now Predictable monthly expense Reallocate capital for strategic projects “.. users benefit from a predictable cost structure that relieves them from supporting an internal VoIP and UC team; a flexible contract arrangement that enables them to add and subtract end-points on an as-needed basis, and stronger customer service with more flexible contract terms.” Source: Gartner, Inc. 250-employee firm would typically have to spend $60-70K in capital to purchase a UC solution and then continue to pay another $150K in maintenance fees over the next 3 years. Not to mention the 100,000+ salary for the certified engineer. And if your company has multiple locations or more employees, you can expect those costs to increase—if not double—for a do-it-yourself approach. Reallocation of capital—both employees and cash—can make an immediate impact to your bottom line when funneled into projects that support your enterprise’s core strategic initiatives.

Hosted UC Driver #2: No Maintenance Expense Equipment maintained by provider Network maintained by provider No maintenance contracts IT employees can focus on other business-centric projects “We considered buying and maintaining a phone system…but the total cost of ownership was way too high. The annual maintenance alone was cost prohibitive at $48,000 a year.” --IT Manager at Mid-Sized Firm

Hosted UC Driver #3: Avoid Technology Risk You don’t own anything Service Provider absorbs the technology risk Leasing equipment protects enterprise from obsolescence By 2013, 40% of workers will have abandoned desk phones. Wireless or soft phones will be mainstream by 2010. Source: Gartner, Inc. With hosted UC, firms lease handsets & soft phones, eliminating risk of obsolescence.

Hosted UC Driver #4: Lower Operational Costs Common dialing plan for geographically distributed offices (4-digit dialing and no long distance costs between corporate locations.) Real-time employee collaboration reduces need for travel Support for mobile workforce enables greater operational efficiencies Distributed call center for maximum flexibility and business value Leverage provider’s extensive resources for lower TCO “By 2012, the use of collaboration will divert $3.5 billion in annual revenue from the travel and hospitality industry.” Source: Gartner, Inc.

Hosted UC Driver #5: Economies of Scaling Leverage provider resources that would be cost prohibitive to do on your own Secure climate-controlled data center with fire suppression Robust and resilient network operations center 24/7 management Redundancy: geographical and physical Easily scale up or down as needs change Deployment of additional locations or new features don’t require installation of a whole new platform Greener--Power demands are shared across enterprises

Hosted UC Driver #6: Technology Management Service Provider: Does the complex integration. Manages the phones, LAN/WAN, QoS and carrier-grade network. Handles problem resolution and user support. Can leverage best-of-breed providers like Cisco, Microsoft and Nortel much more economically. Demand for UCaaS will increase because many enterprises view internally supported unified communications as being too complex and expensive Rated #1 benefit by SMBs

Hosted UC Driver #7: Business Continuity Unlike a premises-based PBX, multiple levels of redundancy are built into the solution Hardened carrier sites Geographically diverse data centers Resilient IP network with many points of egress and access Redundant switching and network elements CPE redundancy WAN failover with diverse access paths Inherent collaboration and mobility features ensure Can realize a level of redundancy that is difficult—if not impossible—to obtain for a mid-sized enterprise.

Case Study: Global Firm Business Highlights: Global law firm with 11 U.S. locations 2,800 handsets, 1,800 employees and partners One of the largest hosted UC deployments Conducted extensive UC research Came to the realization that hosted UC was best approach Selected for reliability, improved productivity and lowered costs Hosted UC user for 2 years Cypress solution included desktop phones, soft phones, collaboration, unified messaging, conferencing, real-time presence, unified dialing plans, ACD, customized business continuity plan, etc.

Case Study: Mid-Size Firm Business Highlights: 60+ employees at 1 U.S. locations Required Unified Communications features Required installation within 60 days Needed uninterrupted voice and data communications Needed flexibility for future growth Considered buying and maintaining a phone system, but the total cost of ownership was too high. Just the annual maintenance was cost prohibitive at $48,000+ a year. Cypress solution included converged desktop and soft phones, collaboration, file sharing, Web conferencing, real-time presence, business continuity.

Enterprise Checklist for Implementing Hosted Unified Communications Low Implementation and Operational Costs: Low or no CapEx. Minimal OpEx with outsourced management. Advanced, Fully Integrated IP-based Communications: Communication tools in a unified interface should encourage collaboration. These tools can help create competitive advantage and efficient operations in a global workspace. Portable Connectivity: The ability to effectively collaborate from any location is a “must” in today’s dynamic and increasingly globalized work environment. Guaranteed Business Continuity: Look for carrier-grade 99.999% reliability and assurance of continuous business operations. Flexible, Upgradable Capacity and Capability: The selected system should readily adapt as needs, resources and technologies evolve. Legacy Service Integration: The system should offer new capabilities without abandoning conventional telecom features you've come to rely on.

Questions? Frank Grillo, EVP of Marketing Cypress Communications fgrillo@cypresscom.net