As if Cisco needs any more negative publicity in light of the company’s recent developments… Reorganizing its consumer business, killing off Flip, missed earnings, layoff projections, and CEO John Chambers in the hot seat:

Now security researchers have demonstrated how easy it is to attack Cisco IP phones out-of-the-box to intercept calls or cause service disruptions via distributed denial-of-service (DDoS) methods. The vulnerability lies in the phone’s web service capabilities — a feature that Cisco recommends disabling in the user manual.

But who reads the manual in the real world, right? ITelecom administrators usually just open the box, take the phone out, and plug it into an Ethernet port. Done. That’s the beauty of the IP phone, as they’d say.

These IP phones are more prevalent in businesses now, in the office and even in the contact center where personal and often private data are handled. Such a security weakness in the phone should be taken seriously as there could be severe legal repercussions with leaked private information, or worse yet, finding out one day that all the phones in the company are out of service.

The best practice should be to harden these IP phones just as you would to a PC workstation. Things such as disabling certain services, configuring the firewall, etc. should not be overlooked.

Today’s guest post is from John Stepp, president of Free Tech Consultants, and his insight into the other aspect of the AT&T/T-Mobile deal: customer service.

Everything I read about the AT&T acquisition of T-Mobile discusses market share, spectrum, overlap, consumers and anti-trust. I want to talk about something different: How AT&T can leverage the most important competitive differentiator that they are acquiring.

First, a little background…

I bought an unlocked Google G1 at launch two years ago from T-Mobile to learn the operating system I thought would be the most important for business over time. Satisfied with AT&T, I nonetheless had to leave to get the first true Google phone. Leaving AT&T proved to be difficult and time consuming. Every conversation with AT&T turned into a sales pitch to get me to stay, but provided little help. It took a lot of time in coordination with T-Mobile to move my land line and cell service to T-Mobile. The experience was upsetting.

When I bought my $540 unlocked Nexus One last January, I thought, ”Great! Now I have a superphone and can continuously comparison shop between T-Mobile and AT&T to get the best rates.” Instead, AT&T along with the other carriers, refused to pick up the Nexus One and there went my leverage to lower rates. Much to my surprise, every time I have called T-Mobile to check on lower rates, they seemed to fawn all over themselves to lower my bill. Instead of a sales pitch to spend more, they alerted me to potentially unauthorized charges from a spammer and credited my bill. My lower charges have completely paid for the phone, and I am not locked into any plan. I now have unlimited voice, domestic long-distance, data, and more text messaging than I can possibly use on an Android Gingerbread smartphone, plus a VOIP land line for under $100 a month (including junk fees and taxes). Thank you, T-Mobile (and Google)!

That brings us to the real point of the article. T-Mobile “gets” the Thank You Economy, the new book by Gary Vaynerchuk. The Thank You Economy discusses how social media is transforming the economy in many ways, but especially when it comes to customer service. When I toured the Tampa contact center of T-Mobile last summer, the culture of true customer service was evident everywhere. Well-paid high tenured professionals that were happy and motivated to delight their customers are the norm there. I quickly understood that my positive experience was not unique. It was a logical outcome of proper vision and execution on the part of T-Mobile. They obviously bought into the philosophy that customer service drives sales and maintains customers. Now will AT&T adopt this philosophy?

My recommendations for the new AT&T-Mobile are:

• Give T-Mobile complete control of AT&T Wireless’ customer service.
• Do not lay anyone off that is involved with customer service.
• Announce to the world what you are doing and why.

This is not a knock on AT&T as much as it is a praise of T-Mobile. The AT&T Wireless people I have worked with and have met at the Wireless Technolgy Forum in Atlanta are true professionals that work hard to create the very best company that they can. My wife still uses her AT&T phone and we have had few issues with the network. If she wanted an iPhone, I would get it from AT&T.

But let’s face it. AT&T and T-Mobile both have good phones. One has less coverage and lower prices while one has more coverage at a higher price. They both have 4G capabilities. There are not too many big differences outside of their size. But like it or not, AT&T has at least a customer service perception problem that adopting the T-Mobile philosophy of customer service will solve. And by promoting the merger with the bullet points above, they have another reason to get the merger approved by the regulators. If they do this right, everyone will benefit.

UK-based analyst firm MZA recently publicized a global PBX market report crowning Avaya as the new leader, thanks to its acquisition of Nortel Enterprise Solutions:

Avaya continued to lead the world PBX market, growing market share from 13% in Q1 2010 to 15% in Q2 2010. Its leadership position was first attained as a result of the acquisition of Nortel. Cisco was in second position with a stable 12% market share while Panasonic moved from fourth position in the last quarter to third position in this, maintaining its 11% share. Panasonic continued to lead in the Below 100 Extensions sector with a steady 16% market share, ahead of NEC in second position and Avaya in third position. In the Above 100 Extensions market, Cisco was the market leader with a 24% market share, followed by Avaya.

It’s neck-and-neck between Avaya and Cisco. However, Cisco leads in the 100+ extensions market with nearly a 1/4 stranglehold on the market. Additionally, Cisco maintains its lead in IP extensions — 1/3 of the market, ahead of Avaya by over 10%. The IP segment is what’s growing.

Avaya’s lead of 3% is indeed noteworthy, but more noteworthy is that it’d spent almost half billion dollars to gain that small market edge. That’s no pocket change. Only to step on Cisco’s pinky. In a technology segment that’s shrinking.

To me that is a bit troubling. Maybe it’s time to abandon that tablet thingy? Resources could definitely be allocated elsewhere…

While the industry is abuzz about UC products from Microsoft, Cisco, Avaya, Siemens, and more, nobody has given much thought on open source UC solutions. Why not? We owe much thanks to open source projects like Linux and Asterisk to create the competition and innovation seen in modern software and telephony applications. Can anyone imagine a Web without Firefox and Chrome? Or office productivity without OpenOffice? Or customer relationship management without SugarCRM? Or database systems without MySQL? Or more recently, mobile communications without Android?

So as the likes of Microsoft, Cisco, and Avaya pump out press releases and tweets like there is no tomorrow in order to gain an edge in the market buzz, I’ve wondered why there hasn’t been much news about open source UC. Obviously the free market has created the demand for UC solutions from Big Telecom, and whenever there is a demand there’s usually open source competition, especially in an enterprise application like UC.

I managed to find a couple: Druid (by Voiceroute) and Elastix (by PaloSanto Solutions).

Unfortunately, Druid’s site hasn’t seen updates since late 2009, even though the forum still has some recent activities.

Elastix is developed by an Ecuadorian company which got its start in California. The site seemed to have been last updated in July 2010.

I do hope these and more open source UC solutions survive and flourish. If the company you work for is an open source advocate then consider contributing to projects such as Druid and Elastix. Having more options to choose from on the UC menu can only be a good thing to customers.

It is somewhat refreshing to hear a Gartner analyst jumping away from the UC bandwagon. After all, UC is probably the second most used acronym in communications these days; the first being VOIP, of course.

Nick Jones, a VP and Distinguished Analyst at Gartner, rains on the jolly UC parade:

UC looks to me like an ill-assorted mix of technologies that vendors want to sell in a single bundle because it’s convenient for them, rather than because they’re what your employees actually need. UC is a dinosaur in a world of fast-moving little furry mammals; the leading edge of communication and collaboration is happening in the consumer space driven by companies like Facebook, Twitter, Skype, Fring, Nimbuzz and dozens more. These are better, cheaper and more fashionable than UC and there is no way the so called “enterprise” vendors can keep up with their rate of evolution.

He has a good point there. I also believe that Big Telecom ran out of things to sell (there’s a limit to the excitement level in selling a PBX) and creatively (yes, I’ll grant them that) cooked a stew of various communications parts, slapped on a licensing model, and asked salespeople to constantly mention the buzzworthy product.

Hmmm, these telecom vendors have done this before…

Aha! Remember the VOIP migration projects? What did you gain going from TDM to VOIP? The answer is most definitely not “crystal clear calls.” Hopefully after going VOIP the call quality is enough to rival that of TDM, but it’s still a phone call. The function of establishing a communications channel between two parties — that remains unchanged.

But I digress. To me UC seems more of a gamble for these vendors. It’s about them (trying) thinking outside of the box. It’s about them demonstrating they know a thing or two beyond phones. It’s about them riding the wave of ubiquitous communications.

Have they succeeded? Well… that’s also up for debate.

In the meantime, UC adopters past and present are also in on the gamble. And as in all games of chance, you’d rather be lucky than good…

Internet speed. That’s how fast some of today’s tech companies operate.

For example, Google. Just yesterday morning (Eastern Time) as I started my daily routine of catching up on news from the hundreds of RSS feeds I subscribe to, the leading tech blogs all echoed the tip about Google testing voice features within Gmail — Google Voice not required, either. Then BOOM! — a few hours later, even before the electrons calmed down on the blogs, Google made it official.

Skype and Microsoft didn’t even have a chance to see what hit ‘em.

Actually, maybe not quite. I’m sure Skype already has drawn a bullseye on Google’s front, and Microsoft’s drawn one on Google’s back. Who can blame them? In a matter of hours the Big G turned its popular Web-based email client into a popular Web-based telephony client. And the Interwebs went wild.

Another step toward UC? Some think so, per Dave Michels of Pin Drop Soup:

UC? Absolutely. Google is taking UC to a fairly comprehensive level with a single number integrated to email, voice mail, chat, presence, voice mail, contacts, mobility, and video – not to mention its collaboration capabilities. Google is keeping it all at a consumer level, but I contend an enterprise version is coming.

Google is putting together a comprehensive strategy unified communications. Consider all the Gmail users, all the Google Voice users (over a million), all the Android users, and it becomes pretty compelling pretty quickly that the competitive landscape in telephony can change pretty quickly.

Over at GigaOM, the thought is that Google should really make Gmail the hub of all communications — including social media:

Google should add the ability to send and receive Twitter direct messages and interoperate with Facebook messaging, so we could have a full-blown communications platform. You can start and end your day in this hub without losing it once. Gmail leverages three of Google’s mainstay strengths: infrastructure, search and simplicity of user experience. If Google were smart, it would take a boatload of money and invest in making Gmail the center of all its forays into social and the enterprise (which would mean making Google Voice work with the Google Apps version of Gmail).

Skype may boast 590 million users, but it lacks good collaboration plugins; and mostly, it lacks cash to go head-to-head with the likes of Google and Microsoft. Hotmail and Yahoo! Mail both surpass Gmail is user base, but they both lack the rich features and simplicity of Gmail.

I can say with certainty that millions of other users startup their browsers with Gmail as the first “go to” site. My next app? Skype. Now I’m wondering if I’ll ever need to click that Skype icon again…

The economy’s in the dumps. Housing market in a slump. Stock markets are like a family of bears.

But believe it or not, the entrepreneurial spirit is alive and well. See, entrepreneurs are a silly bunch. They’re risk takers, they’re great at exploiting opportunities, they’re blinded by ideas, they’re determined to eliminate the word “impossible” from the lexicon.

(Okay, so it also helps that their companies aren’t focused on the housing market…)

But startups and the entrepreneurial culture is vital to any economy. The Internet and the Web has evolved — 2.0, 3.0, whatever — all I know is that the Web waits for no one. That’s why events such as the StartupCamp Comm Edition is so important, not only for the presenting startups, not only for the tech industry, but also for our economy.

Mark your calendar: October 4 in Los Angeles, that’s where all the startup action will be.

The previous event in Miami was packed and featured startups like Close Haul, Fonolo (covered here before), Pebb.ly, and SayHired. These have already signed up for October: The 2600hz Project (covered here too), AdelaVoice, GeoGraffiti, Freespee, MedTaker, Ringio, Vokle, NumberTank, and Cloud Telecomputers. That’s more than twice the number of presenting startups than were in Miami!

Larry Lisser, founder of the event and partner of event organizer EMBRASE Business Consulting (and prominent Bay Area comm blogger), has this to share:

This is a StartupCamp exclusively focused on those innovating with communications technology. Ours efforts are all towards creating a unique opportunity for early stage companies to show off to both influencer and prospective customer audiences.

With all the excitement and activities surrounding the communications business sector, it’s great that there’s an event to showcase startups in this space. Comm startups should definitely look into attending, if not presenting, at this event!

Remember the good ol’ days when you could build (or buy) a blue box to make free long-distance phone calls? The blue box generates the 2600 Hz tone which instructs the old phone switches to allow a LD call. It’s funny, be it Karma or whatever you call it, now the phone companies get to stick it to us with convoluted billing statements, overpriced SMS plans, and ridiculous tethering allowances.

But I digress. The 2600hz Project and what it aims to do:

2600hz is home to a collection of open-source telephony software that enables the use of the FreeSWITCH, Asterisk and YATE switching libraries. Initially built around the blue.box project, we aim to provide a collection of software to power your GUI, your cloud-based telephony switch and/or your monitoring and maintenance tool set.

The project was started by some core developers behind FreePBX. According to Om, the venture received $250,000 in funding already.

It’s always good to know that open source telephony continues to receive the attention it deserves.

This guest post is by John Stepp, President of Free Tech Consultants. It’s typed entirely on his Nexus One. Just kidding (but he could’ve).

I know that many are saying that the phone is dead, at least the desktop and landline phone.  If that is the case then why is the mobile world so utterly controlled by the phone?  First people were going crazy to get their hands on the iPhone 4, now many are incensed to find that it has a flaw.  Nobody seems to care much about the revelation that every single iPhone ever shipped has been exaggerating the signal strength of the carrier, AT&T.  No, it is all about the phone.  It is all about the user interface and the user experience.  I understand.  I feel the same way.

When my Nexus One was not perfect and needed to be repaired because of a hardware issue, I had the option of returning it.  Although having calls dropped and having slow data speed was frustrating, I finally decided to just get it fixed.  Just like the Apple iPhone users, I was too enamored with the phone to give it up.  Now that it has the Android 2.2 software on it, the phone is better.  Sure, there is still a dropped call from time to time, but the user interface is great and the data speeds are fast.  Even as the Nexus One is discontinued, CNET tests show that the Nexus One on T-Mobile has data speeds equal or superior to the newer phones.  Whoopi Goldberg was so disgusted with her iPhone 4, she ran over it with her car, but then she went and bought an Apple 3G instead of going to a competitor. The similarity between the Android and Apple infatuation is the great application suites that come with these phones.  From the stunning displays, to the audio/optical communications tools to the immediate access to information, there is much to like.

Gartner recently said that smartphone sales were up almost 50% year over year. And the latest information from ChangeWave Research shows that the next ninety days will have the most explosive growth in smart phones ever with Apple and HTC (Android) leading the way.  However, Research in Motion, the BlackBerry maker favored by most businesses will see its’ market share erode further.  Why are phones that businesses favor in a funk while consumer phones are in such demand that there are now four week backlogs for all the favorites?  The user interface, the phone itself is driving demand and driving change.  E-mail delivery and simple conversations are not enough anymore.  We want pictures, video, social media and immediate access to information.

Businesses will be adapting to this changing landscape on mobility and on the desktop.  Productivity in the workplace will accelerate when the devices employees use in business match that of the devices used in people’s personal lives.  The business telephone and video manufacturers are providing easy to use high value applications for their user interfaces be they computers, netbooks, display phones or video portals.  The future is bright for the companies that decide that the phone (user interface) is everything.  The businesses involved in bringing these “smart” business communications devices to market will grow quickly and sooner than many predict.  And the improved productivity will help businesses grow faster as well, just like the digital revolution did in the nineties.  The phone may morph into many different types of devices, but the future of the phone is as bright as the new displays on the smartphones.

Imitation is the highest form of flattery, but come on, this whole tablet craze has gone too far.

So Apple came out with the blockbuster iPad tablet, and now everyone and their dogs are making one. Yes, I’m talking about you, Avaya, RIM, and Cisco.

What I find funny is that the PC companies — namely Microsoft and HP — abandoned their tablet projects once the iPad was imminent and proved to be a huge success, but it’s the communications companies that have a hard time letting go.

I’m not saying that the iPad is the end-all of all tablet devices. No, let’s hope not. I do want to see competing devices from Microsoft and HP (especially using the recently acquired Palm webOS). These are the companies that have been in the computing business for decades and have a clue about these devices.

But for companies like Avaya, RIM, and Cisco to venture into the tablet alternate universe is not productive. In fact, I dare say that it’s more of a marketing ploy than anything else — generate buzz, ride the iPad’s coattails, show ‘em we’re hip. After all, it’s not too hard to make one these days: source the cheap hardware from China, slap on the OS (be in Android, Windows, or Blackberry), and announce it to the world.

But guess what? There won’t be companies lining up to buy one of these babies.

You should know better, guys. And I’m not talking about not challenging Apple because you are targeting business users. I’m talking about your denial that communications today is more about applications than about the device. Leave the device to the likes of Apple, Microsoft, HP, and IBM to design and make. You are supposed to be leaders in the communications biz, but why am I still carrying an iPhone and a Blackberry and still staring at my ugly desk phone? Now you also want me to carry your tablet?

We’re all accustomed to the fact that audio capabilities aren’t limited to phones anymore. A lot of the emphasis on these new tablets are about video capabilities, but this is 2010 and we also know that smartphones have the horsepower for video, too. So really, is there the need for a business tablet?

So here’s my advice: Abandon your tablet projects and hire more developers and UI experts to focus on applications. If you insist on a tablet, then OEM it from somebody who knows it better than you. Partner with the tablet makers to ensure your app is well-designed for their device. But for the sake of business please stop it with the tablet business.