Cisco and the war for, um, hosted email

Sticking toes in the cloud

Conversion won't happen in a day — not even to the companies eagerly gulping down the cloud-hosted Kool-Aid. Pray believes most companies crossing over will stick to a hybrid model of hosted and in-house email solutions for several years to come. Standing issues of control, security, and compliance are enough to guarantee that.

"There's not a lot of legal precedence throughout the world about where this data sits, who owns it, who controls it, and so forth," Pray said. "Legal decisions are coming out every day that are kind of all over the place depending on what country you're in."

Even Cisco told us it is planning a hybrid model of in-house and hosted email across its internal system.

Importantly, Cisco has a larger reason to splash into the untested waters of hosted email: It's a cheap, and it's a taste that could lead people towards more collaboration software.

Along with WebEx email, Cisco last week rolled out a host of "social" business collaboration prod, including a YouTube-style video sharing system and a Facebook-like profile and directory product.

Maribel Lopez, principal analyst at Lopez Research, suspects this is the real rub of entering the hosted email market.

"What they're trying to do is roll out a full collaboration suite. And having collaboration without email is like having a bicycle without wheels," Lopez said. "You don't need to have it, but if you don't it's noticeable and provides an opportunity for somebody like Microsoft or IBM to have a full anchor on a customer."

Lopez said she considers the client to be richer than what you'd get with Google - and comparable to offerings of IBM and Microsoft. But she sees the service more of a box to be checked when comparing its larger collaboration offerings.

Cisco's Hadden-Boyd told us that WebEx Mail is being sold both as a stand-alone product and a piece of a greater collaboration lineup. But she adds that "ultimately email needs to evolve and play a bigger role in collaboration."

"That's really where you'll see a lot more possibilities going forward," she said.

It's a strategy already being deployed by the others. Google has its Gmail closely tied to the entire Apps lineup for businesses. IBM's LotusLive iNotes has the Lotus Notes branding just for kicks. Microsoft ties it all to its Business Productivity Online products.

Cisco's entry into newly-bustling hosted email does seem to spell doom for smaller hosted email providers. Attracting customers to a niche service is a tough proposition when proven reliability is key and you're up against major labels.

The company's move is a departure from the norm, but not surprising. The market is just too tempting for anyone with a massive amount of hardware and reasonable know-how. It's only a matter of time before the next big name steps into the arena. Rumor is that Yahoo wants to sell its open source email and collaboration outfit, Zimbra. The market is only a purchase away. Who's up for it? ®