The VAR Guy

It’s one small step for Dell, and another great leap for Asterisk — the open source VoIP phone system. Dell plans to promote Fonality (a major Asterisk proponent) to small business customers seeking IP telephony systems. It’s a landmark development, folks, that benefits Dell in multiple markets (open source, VoIP, unified communications, and managed services). Here’s why.

While most people are zigging, Michael Dell continues to zag. In mid-2007, Dell announced the surprising decision to pre-install Canonical’s Ubuntu Linux on selected desktops and laptops. Red Hat and Novell were the obvious choices for that deal (and Dell maintains partnerships with both companies), but Michael was running Ubuntu on one of his own PCs and gave the operating system his blessing.

This time around, Dell wanted to cash in on the booming VoIP market for small businesses. Dell could have inked a deal with Cisco, ShoreTel, 3Com or any other SMB networking specialist. If Michael was ready to make another open source move, the obvious partner was Digium — which is widely considered the de facto leader of the Asterisk movement. (Digium was Number 2 on The VAR Guy’s list of top 10 open source companies to watch in 2008.)

Once again, though, Michael is betting on a lesser-known partner (Fonality) while also working with Nortel. There are some details buried on Dell’s web site.

Fonality should not be underestimated. The company has been growing 10 percent per month on average and achieved profitability in 2006, according to Fonality’s Web site. Early Fonality investors include Intel Capital.

Did We Mention Managed Services? 

The Fonality deal may also help Dell to push deeper into managed services. The reason: Many solutions providers and service providers are testing or deploying Asterisk as a hosted phone service. It’s easy to envision those service providers deploying Dell/Asterisk servers in their data centers and Asterisk phones at customer sites. In fact, Dell is pursuing that very model by offering Fonality in a “hybrid-hosted” configuration (part on premises, part hosted).

Naturally, Fonality’s CEO is thrilled about the Dell deal. But this is a smart move by Dell as well. Michael has had mixed results in the networking industry, where its SMB efforts are overshadowed by established players like Cisco, Linksys, Hewlett-Packard ProCurve, NetGear, etc.

But this time around, Dell is ahead of the curve. Asterisk is wildly popular within open source circles. And it is the hidden foundation of many l0w-cost SMB phone systems. For Dell partners and customers alike, Fonality could be the perfect extension to Dell desktops, servers and notebooks. In fact, Fonality’s CEO notes that his company’s software already runs well on Dell servers.

Dell never made much noise in the Ethernet switch market. And Dell was mostly quiet as VoIP gained momentum. But through the Fonality deal, Michael has finally found a way to get into the unified communications game.