THE INNOVATION LEADER IN ENTERPRISE IP TELEPHONY

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Agenda• Current Voice Infrastructure Challenges

• Evolution of Business Communications

– Voice over IP Defined

– Voice, Video & Data on a Single Communications Platform

– Drivers To IP Telephony

– Major Customer Benefits

• Business Telephony Shifting to Pure IP

– Business Continuity

– Highest Customer Satisfaction

– ShoreTel Shines at Ease of Use

– Lowest Total Cost of Ownership

• Shoretel Overview

– ShoreTel’s Unique Architecture

– Minimizing Server Use

– Measuring Customer Delight

– Customer Feed Back

– More Than 5,000 Customers Across All Industries

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Current Voice Infrastructure Challenges• Supportability

– Old Equipment • End of Life• Failure Rate• Part Replacement

• Manageability– Multiple Disparate Platforms with Separate Interfaces– Multiple Service and Support Contract (Handled Per Site)

• Disaster Recovery– No Recovery Site for Voice– Difficult to re-organize staff regionally– Setup Up Time Un-Realistic

• End User Application – No Advanced Feature Sets for Users– No Inter-site Communications Between Sites or Business Units– Disparate Feature Sets between all Sites and Users– No Unified Communications – 4 Digit Dialing, Unified Messaging/VM, Instant Messaging, Unified

Directory Company Wide, No Collaboration Tools, No Conferencing Resources

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• Centralized control• Inflexible• Vendor-driven services

Mainframe Computer, Circa 1975 PC LAN, Circa 1990

• Distributed control• Customization• User-driven services

Digital PBX, Circa 1995 IP PBX, Circa 2002

Evolution of Business Communications

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Voice over IP Defined

Internet TelephonyInternet telephony refers to the practice of running voice traffic over the public Internet. Generally has issues with voice quality and is not good for businesses.

Traditional Digital PBXA Digital PBX interfaces directly with the Public Telephone Network via Time Division Multiplexing technology. 20+ year old technology with little or no flexibility or upgradeability.

ShoreTel IP TelephonyIP telephony refers to the technology for transmitting voice communications over a network using an open standards-based Internet Protocol (IP).

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Voice, Video & Data on a Single Communications Platform

email

Voice Messaging

Collaboration

Calendar

Video Conferencing

Web Application

Audio Conferencing

Instant Messaging

TelephoneServices

Voice and Video on the Data Network

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Drivers To IP Telephony

Business Resilience• Business Continuity• Disaster recovery

Business Resilience• Business Continuity• Disaster recovery

Competitive Advantage• Rain Dance - Conference Calls Internal• Content Sharing – Power Point, Word, Excel• Mobility and teleworker gains• Find Me, Follow Me• Higher productivity

Competitive Advantage• Rain Dance - Conference Calls Internal• Content Sharing – Power Point, Word, Excel• Mobility and teleworker gains• Find Me, Follow Me• Higher productivity

Expanded BenefitsExpanded BenefitsImproving Business Improving Business

ProductivityProductivity

Lower CostsLower Costs• Reduce mgmt costsReduce mgmt costs• Move, add, changesMove, add, changes• Lower cabling costsLower cabling costs• Toll bypassToll bypass

Lower CostsLower Costs• Reduce mgmt costsReduce mgmt costs• Move, add, changesMove, add, changes• Lower cabling costsLower cabling costs• Toll bypassToll bypass

Initial BenefitsInitial BenefitsReducing CostReducing Cost

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Major Customer Benefits• Single Communications Platform for all Business Units

• One Maintenance Contract for All Company Sites (Just like Data)

• Standardized Phone & Feature Set at All Sites and for Remote Workers

• Standardize Support for all Sites

• Responsive Disaster Recovery Strategy

• Communications Tools for the Future– Conference Bridge & Web Collaboration

– Single Global Directory

– Outlook Integration

– 4 Digit Dialing to all Sites, Users, and Mobile Phones

– Single Voicemail System

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Business Telephony Shifting to Pure IP

Source: Gartner Dataquest 2006 Pure TDM IP-Enabled Pure IP

Line Shipments to North American Enterprises

Thou

sand

s

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

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Business Continuity

• Allows business to continue despite severe interruptions

• Quickly setup remote communications for Disaster Recovery

• Minimize business down time

Purpose Built Communications Platform

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Highest Customer Satisfaction

1=unacceptable, 2=poor, 3=fair, 4=good, 5=excellent

Source: Nemertes Research 2007 for 2006 results, selected categories shown.

# 1 in Customer Satisfaction in Every Category for 4 Years Running

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PricingEase of Use Pricing-to-Performance

ShoreTel Avaya Cisco Mitel Nortel

Infonetics: ShoreTel Shines at Ease of Use, Pricing, and Price/Performance

7

6

5

4

3

Source: Infonetics Report. User Plans for Voice over IP: North America 2007, April 2007

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Lowest Total Cost of Ownership

Source: Nemertes Research 2007

$645

$354

$540

$188

$646

$927

$739

$532

$542

$114

$1,185

$896

Competitors Competitors

Capital Costs

Start-Up Costs Ongoing Annual Operating Costs

Less than 1,000 Lines More than 1,000 Lines

Operational Costs

(1) (2)

$750

$142

$11

$386

Competitors Competitors

Ongoing Operational Costs

Less than 1,000 Lines More than 1,000 Lines

(3) (4)

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ShoreTel Overview

ApplicationsShoreGear

IP Voice SwitchesShorePhoneIP Phones

Founded 1996

Headquarters Sunnyvale, California

Customers 5,000+

Ownership Public, Listed on NASDAQ (SHOR)

Profitability 9 Sequential Quarters

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Most Phone Systems Create Customer Pain

San Francisco

Regional Office System

Headquarters Office System

Branch Office System

PBX

VM

PBX

VM

PBX

VM

Boston

London

WAN

PSTN PSTN

PSTN

• Independent Telephone Systems

• Limited Feature Transparency Between Systems

• Fixed Capacities

• Costly to Maintain and Manage

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ShoreTel’s Unique Architecture • Reliable

– Switch-based

– Not server dependent

– N+1 redundancy

• Distributed– Sites operate independently

if network fails

• Scalable– From ten to tens of

thousands of users

• Managed as a Single System – Low TCO

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Minimizing Server Use

Call Processing

E911

Paging

Voicemail

Desktop Call Handling

Operator Client

Integrated System Mgmt

Total Servers

Headquarters Regional Office

1 1

Total Servers: 2

Headquarters Regional Office

Server Centric Pure IP Alternate

9 5

Total Servers: 14

Switch Based

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50

55

60

65

70

75

80

85

90

95

Baseline Q305 Q405 Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407

Measuring Customer Delight(Q3 FY05 – Q4 FY07)

Ran

king

92.1791.0686.5283.38 87.42 87.63 91.14 91.16 90.90 92.70 92.36

World Class

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Customer Feed BackVICKI LITTER

• EASE OF USE Rating:  8

– “ I think at first it is a very complicated. However, after using it for some time and being taught the features, it is a pretty .  There are a few features that I still have problems with, but I am sure with more training it will work just fine.”

DOUG PILIGIAN

• RELIABILITY OF SYSTEM: Rating: 10

– “ Never had a problem that was related to the VoIP system. I believe this will be a business and productivity tool for Company. “

MISTY CUELLAR

• PHONES: Rating: 9

– “ There are always features that can make any phone system better - this phone covers it. Our old system (Avaya) is not as efficient as the ShoreTel system. Features available allow us to transfer & check messages at a much faster rate. “

SHANNON GASKINS

• SOUND QUALITY & OVERALL EXPERIENCE: Rating: 10

– “ Love the speaker phones sound. There are many features that are advantageous to my daily work routine, for instance, I am able to receive an email notifying me that I have a new voicemail. “

nice phone system

GREAT

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More Than 5,000 Customers Across All Industries

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Thank you for your interest and consideration of

Conexant Communication’s Enterprise Solutions.

We looking forward to working with you!