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Mitel to Go Big in CPaaS Market with ShoreTel Acquisition

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Watch out Cisco, Vonage and RingCentral: Mitel soon will be poised to take on the communications platform-as-a-service (CPaaS) market equipped with ShoreTel’s Summit platform.

451 Research's Raul Castanon-Martinez

451 Research’s Raul Castanon-Martinez

That’s one of the key benefits Mitel will gain from its $430 million acquisition of ShoreTel, said Raul Castanon-Martinez451 Research’s senior analyst of enterprise mobility. The acquisition was announced last Thursday.

“[ShoreTel ‘s Summit CPaaS platform] will allow Mitel to catch up with Vonage, which acquired Nexmo last year, and Cisco, which acquired Tropo a few years ago and integrated it into the Spark platform,” he said. “Its expansion into CPaaS will be a significant growth opportunity for Mitel. This is a key trend in the UCaaS space: providing modularity and integration for clients to embed communications services into their applications and services. This will help Mitel catch up with the likes of Cisco, Vonage and RingCentral.”

Todd Abbott, Mitel’s executive vice president of global sales, tells Channel Partners the pairing creates a supplier with the scale, technical capabilities, a broad portfolio and future outlook “our partners can leverage to take businesses of all sizes and kind to the cloud.”

“The rate of industry consolidation in the UC segment is accelerating, and this combination further solidifies Mitel as the clear global leader that partners can bet their businesses on,” he said. “As industry consolidation accelerates, customers and partners want to be assured they are aligned with a supplier they can trust to not only meet their business communications requirements reliably, but also set the pace of innovation in delivering new capabilities to customers. The size, scale and quality of team for the combined companies positions Mitel well to accelerate the rate of innovation for cloud-based collaboration in the enterprise.”

Mitel's Todd Abbott

Mitel’s Todd Abbott

Prior to its decision to acquire ShoreTel, Mitel already had embarked on a simplification of its channel program, Abbott said.

“The new Mitel program is scheduled to launch in Q1 for implementation at the beginning of Q2,” he said. “Mitel will incorporate the best components of the ShoreTel program into the new program. The existing ShoreTel partner program will remain in effect through the end of Q1 2018 until the new Mitel program goes into effect.”

Mitel said the combined company will be the No. 2 player in the UCaaS market, and it more than doubles its UCaaS revenue to $263 million.The transaction is expected to be completed in the third quarter of 2017.

Mitel and ShoreTel’s combined annual sales total $1.3 billion. The combined company will have about 3,200 channel partners and a portfolio of communications and collaboration offerings.


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