The Zultys saga

Last week, the large scale lay-offs to reduce operating costs in wake of a funding crisis has crippled the operation and adversely affected the name of the vendor. Coming at a time when Zultys announced the launch of new products and a release that boasted of new capabilities in collaboration and messaging , Zultys failure to secure funding has devalued its branding significantly. Spotting the opportunity another innovative software based PBX vendor, Swyx invested with Google to divert eyeballs from Zultys to their website by exercising a cute marketing campaign.

There are a few takeaways from this episode. For one, the entry barriers have reduced significantly. However the importance of PBX hasn't dimished with the customers. This I believe is going to put significant pressure on the channel to constantly monitor their supplier's health to the effect to get contractual commitments from them to be in business.

Second is the intense competition in this market. The campaign launched by Swyx is indicative of the margins that can be gained when a software solution replaces a hardware product.