A warm welcome to you all, and thank you for attending today's webinar. Learn how your business can be more productive and effective with Polycom Collaboration Solutions for Microsoft Lync, brought to you by Microsoft and Polycom. I'm Brooke Campanelli, and I'm your moderator today. We have just a few announcements before we begin. All participants will be muted for this call. You can participate in the Q&A session by asking questions at any time during the presentation. Just type your question into the Ask a Question widget in the bottom of your screen, then click the Submit button. Questions will be fielded towards the end of this webinar. To view speaker bios, simply click on the Bios icons. The slides will advance automatically throughout the event.
If you are experiencing problems with the program, please press F5 on your keyboard or close your window and relaunch the presentation using another media player. You can also visit our webcast help guide by clicking on the Help button below the slide window. Now on to the presentation, learn how your business can be more productive and effective with Polycom Collaboration Solutions for Microsoft Lync. I'd like to welcome Sue Hayden, Polycom's Executive Vice President of Strategic Alliances, to start off the webinar. Sue is responsible for Polycom's Strategic Alliances and global partnerships, including Microsoft. Sue, please start us off.
Brooke, thanks so much for the introduction, and welcome everyone to the webinar this morning. It's my pleasure to introduce all of today's speakers and to kick us off. As you can see from our agenda today, we have a very full agenda of topics. First, we're going to start off with a snapshot of our alliance with Microsoft and provide a short overview of Lync's capabilities, and then take a close look at the new Polycom voice and video solutions that we recently announced. Next, we'll hear from our esteemed customer from Sprint, and then open it up for all of your questions, and we'll provide answers to those. If we'll just go to the next slide, let me do a brief introduction of today's speakers for all of you. We'll be joined by Jim Kruger, Polycom's Senior Vice President of Global Solutions Marketing.
Jim has more than 18 years of experience in leading business and marketing strategy and execution, and in his role as SVP of Global Solutions Marketing for Polycom, Jim oversees all aspects of product, services, and industry marketing. Prior to this position, he has spent nine years in Polycom's Voice Division in Product Marketing and Management and General Management and was instrumental in increasing share and bringing breakthrough new products to market. We'll also hear from Kirk Gregersen, General Manager of Microsoft Lync at Microsoft. Kirk Gregersen is a General Manager in Microsoft's Office Division and is responsible for product management and marketing of the company's real-time communications products, including Lync Server, Lync Online, Lync Client Applications, and Live Meeting. Kirk joined Microsoft in 2000 and has held a variety of leadership roles in Office Product Management and Business Planning, as well as managed several online service incubations.
We'll also hear today from Joe Hamblin, the Senior Manager of Enterprise Communications and Collaboration at Sprint. Joe is a leader in the unified communications field and is currently the Senior Manager of Sprint's Enterprise Communication and Collaboration organization within the Information Technology Group. He's been in the communications industry for more than 30 years and with Sprint for the past 24 years. Joe has held a variety of leadership roles, including engineering, planning, and strategy, and has had extensive experience with technology providers such as Microsoft, Nortel, Cisco, Fujitsu, and NEC. You can see today that we have a terrific panel for you to take us through this morning's discussion. Let's take a little bit of a closer look at the relationship between Microsoft and Polycom, which we like to say is a real natural partnership. Polycom and Microsoft have a strong strategic relationship.
This relationship entails product development as well as a coordinated go-to-market initiative with a real focus on providing innovative solutions. Together, we share a vision for business productivity solutions that are built on standards-based platforms that provide open, interoperable, flexible, and flexible solutions that protect our customers' investments. Together, Microsoft and Polycom deliver end-to-end UC solutions that transform unified communications for our customers. We're proud that Polycom is the only company offering integrated HD voice and visual communications for Microsoft Lync and other Microsoft UC suites for complete end-to-end UC offerings for our customers. We're proud to have been named as Microsoft's 2011 Unified Communications Innovation Partner of the Year. You can see we have a long history of working effectively together.
What I'd like to do is I'd like to actually share with you what some of the benefits are that our customers are seeing as a result of these joint solutions. In a recent survey of over 300 customers that were benchmarking the return on investment and the benefits of video conferencing, Polycom and Wainhouse Research found that on average, video conferencing helped enterprises reduce more than 30% of their travel costs, reduce time to market by 24%, reduce downtime, save on training, shrink recruitment times by almost 20%, and reduce sales-related expenses by 24%. In fact, we've seen these same kind of benefits over and over and even stronger ROI and productivity improvements from customers who've adopted Polycom Solutions with Microsoft Lync. You can see some of the companies' logos on this slide. These are some of the many, many customers who enjoy some of the benefits that I just mentioned.
Let's take a little bit of a closer look at some specific examples, and obviously we'll hear from Joe from Sprint a little bit later on in the call. Here are some specific examples of the customers that are really enjoying productivity and impact from these UC solutions. Take, for example, LA Fitness, who enjoys more than $500,000 annual savings as a result of their implementation of Microsoft and Polycom UC solutions. They were able to replace their existing telephone systems with more reliable and full-featured solutions, and they added the true benefits of truly unified communications. What they found was that Microsoft Lync helps facilitate consistent culture, attitude, and behavior throughout LA Fitness, and they no longer have to use traditional PBX or Private Branch Exchange systems and are able to use Lync to make and receive calls.
As a result, they're saving more than $500,000 a year, cutting charges for tools and conferences and the costs associated with installing and supporting telephony solutions across their clubs. Additionally, obviously a different industry, Nasdaq, has been a Polycom customer for more than five years, and they've recently purchased Polycom RealPresence Platform and immersive telepresence solutions because they needed to upgrade their infrastructure to Lync and wanted to take advantage of high profile. It's that high profile capability that allows them to use up to half the bandwidth they would have normally required for other video solutions. They continue to invest with Polycom and Microsoft because of open standards and our strong partnership. Finally, NDS is seeing huge benefits with an upgraded Microsoft and Polycom platform, time savings, productivity gains, reducing costs, and really streamlining process. One last point, we had a customer on the prior slide, A.T.
Kearney, which recently deployed Lync as well. One of the things they found was that it was actually the fastest uptake of any product they've ever introduced across the business. They found when they put it out there, it spread like wildfire. It was just intuitive, and their internal users just picked it up. In fact, more than 60% of their 32,000 users were using it within 24 hours when the tool just landed on their desktops. There were no compatibility issues. There were no scalability issues. It just worked. These are some of the terrific advantages that our customers are seeing when they implement Polycom and Microsoft solutions. I'm often asked, "So tell me, Sue, tell me about Microsoft Lync and that set of solutions." I can't think of anybody better to introduce that set of solutions to you than Kirk Gregersen.
At this point, I'm going to turn the call over to Kirk to take you through an overview of Lync.
Thanks, Sue. Good morning, good afternoon, everyone. Thanks for your time today. We're very excited about the partnership with Polycom and how it taps into both companies' strengths and experience. I'm personally very pleased to be able to participate today to help highlight some of the latest examples of our joint solutions coming to market from Microsoft and Polycom because we see these really delivering on the promise of interoperable standards. Before I get into some of the specifics around Microsoft Lync 2010, I wanted to take a couple of minutes to talk about how unified communications or UC falls into Microsoft's broader business productivity vision, essentially how we think about collaboration and productivity all up, and how we orient ourselves in terms of our investments and information work and productivity software, which is really our heritage and passion as a company.
There are three areas that we focus on as North Stars as we think about investments and product development in unified communications and collaboration more generally. The first you'll see has to do with the capabilities or workloads that you see along the bottom of this slide. These, in many ways, in our approach here is reflective of the journey that we've been on with the broader industry around really transforming information work over the last 20 years. The way we would think of our differentiation in this space is that we think not only vertically in terms of each of these capabilities, but we also think very deeply about the interaction model between them. We invest on both dimensions, and that's something we think is unique in the market.
For example, as we design Lync and SharePoint, we'll think about how expertise search can be accessed via a real-time tool like Lync or within SharePoint itself, how you could access, tap into those real-time capabilities, and how, for example, that scenario can benefit from things like presence. Taking at Enterprise Content Management, another example is that we think a lot about how content management and real-time communications and workflow are deeply related to an Office document. As we take this broad approach, we think this brings a lot of benefits to customers in terms of the level of interop within the end-user experience, the types of out-of-box capabilities we can deliver, like the SharePoint skill search example I just mentioned, benefits from server and vendor consolidation, and really a more consistent and familiar management and developer experience.
A core part of the value proposition for this North Star is really making sure that these workloads are well integrated together for the IT administrator and the end user. Another point here is that we've consistently sought to, I'll use the word democratize, access to more of the high-end and powerful workloads so that millions of end users can tap directly into capabilities like ECM or business intelligence in the context of the everyday tools they're used to, like an Excel or a SharePoint or a Lync. This theme of opening up these kinds of scenarios to end users is something I'll touch on again as we get more into Lync and talk about concepts like video and conferencing.
The second North Star that I'll refer to on this slide is that we're maniacally focused on delivering this broad productivity experience across the PC and the Mac, the phone, and the browser. This is in part because the world of computing is changing. As all of you know, our heritage has been in the PC, but we see so much opportunity around new form factors. One of the things we're doing is taking the Office platform and making it available across many form factors, in essence, in any place where our customers are. Of course, we're making big bets on Windows and Windows Phone, but we're also the only vendor on the market that's taken productivity as broadly and deeply across multiple platforms. I'll give an example here of Office 2010.
We think Office is the leading productivity on the PC, but many folks are also surprised to find that Office is one of the most widely used software products on the Mac. With the 2010 release, we also took many of these capabilities into browser-based applications and made them available via, whether it's Safari, IE, Firefox, and complementing what we've long delivered with Outlook Web Access, which is one of the more well-known examples here. We've done the same thing with taking, let's say, a rich mobile version of an application like OneNote, bringing it to Windows Phone, but then to the iPhone as well, and taking Exchange ActiveSync across multiple platforms. You'll see us continuing to deliver across modalities in native forms, including a big Lync mobile release in the next couple of weeks.
The second area is a huge focus for us, and it's also one of the reasons why we are so excited about the Skype acquisition. I can talk a bit more about that later as well, but really going to where our users are and connecting people. The final North Star I'll reference is around how we approach the Cloud, and there's no question that the Cloud is top of mind for many customers today, which has been really a big change over the last 18 months- 24 months. Today, when we talk to customers, the Cloud comes up in almost every conversation, and many folks may not be going there yet, but they're thinking about it. We realize that we need to be helpful in terms of that transition.
We also believe in delivering the Cloud on the customer's term, as the phrase you'll see on the slide, which really means that we want to make sure there's choice and flexibility in terms of the deployment options, whether it's via server, on-premises, via pure service, private and public Cloud, hosted, or via Office 365, which is our services suite, or in a hybrid context. This is another place where we would say we're one of the only vendors in the market that across productivity solutions and collaboration is so committed to taking this journey with customers and providing the flexibility to how customers want to move to the Cloud or some combination. With that as a basic introduction to our overall approach and focus for UC and C or productivity more broadly, I'll spend a couple of minutes on Lync 2010. Lync 2010 is Microsoft's real-time communication solution.
With this release, this was the next stage of the journey, which began with the Office Communication Server product and Communicator. With the 2010 release, we really aimed to transform the way people communicate and to get them to be able to communicate anytime, anywhere, and in new ways. Lync's journey really represents the evolution of the collaboration space generally from what we saw when we started on this journey as lots and lots of siloed workloads to a more integrated and truly unified communication solution. Lync 2010 delivered on that promise of being the first truly unified communication solution on the market, bringing IM and presence, PC to PC, audio and video, web conferencing, and enterprise voice and video into a single experience for all users. That takes place on multiple levels.
For the end user, this means a single client experience and not having to jump in and out of multiple interfaces and application experiences. For the IT professional, the benefits there are from a single infrastructure to manage, i.e., one server. It's also the same underlying architecture, whether you're running Lync on-prem or in the Cloud or in a hybrid mode. For the corporate developer or the developer generally, Lync provides a single set of unified APIs that enable real-time communications to be incorporated into business applications and workflows, essentially really delivering on the promise of communications-enabled business process, which has been a long time coming. One of the things that this unified infrastructure and reduced management tax can mean is greatly reduced cost.
One of the things I love the most about working on the Lync business is really the hard dollar savings that free up resources for other projects and initiatives when you talk to customers. In a moment, as Sue mentioned, you'll hear from Joe Hamblin as he talks about the money that Sprint's saved and the business benefits and transformation they've had. Other customers, like Sue mentioned, LA Fitness, are saving millions of dollars consolidating and simplifying their infrastructure. I'd encourage you to take a look at the more than 400 customer references for Lync and Microsoft UC that we have up on microsoft.com on the Lync site.
The second area that we've seen customers get quite excited about is that Lync 2010, and the way it's been designed, particularly the end user experience, brings a lot faster adoption and ROI because of the easy-to-use Office-like interface and the out-of-the-box integration with SharePoint, Exchange, and Office 2010. This means a quicker path to value and reduced training costs, and more importantly, that people can collaborate from wherever they are, whether that's collaborating in a co-authoring session in Word or PowerPoint, or scheduling a web conference with one click in Outlook, or seeing a colleague's presence and contact information via the contact card integration in SharePoint or Outlook. Lots of different places where you'll see essentially unified communications sprinkled throughout other application experiences. We have found that this leads to great adoption and quicker return.
Sue mentioned the Commonwealth Bank of Australia, which had recently rolled out to their 32,000 users, and due in part to this integration, CBA had great usage, 60% within 24 hours, and an incredibly fast product rollout. We have that great video on the microsoft.com site that you can check out if you're interested in CBA's story. Finally, and most important for the discussion today, Microsoft Lync 2010 also provides for great interoperability, both with legacy PBX infrastructure if a customer isn't ready to replace their PBX like Sprint has done or LA Fitness, and also with cutting-edge technologies and solutions like the ones we're hearing about today from Polycom.
Today, we have major announcements on both fronts, expanding our interop with Polycom SIP and wireless phones, and also talking about innovative solutions like the new C X7000, which was specifically designed for Lync and is the first video and collaboration solution optimized for Lync. Now, with that, let me turn it back to Jim so he can talk a bit more about this great new product.
Great. Thank you, Kirk. So far, we've heard about the benefits of unified communications from an ROI perspective. Sue talked about that, and then Kirk, of course, just gave the overview of Lync. I wanted to spend some time on the new solutions that Polycom is in the process of launching, specifically for a Microsoft Lync environment. Before we jump into that, I always like to talk about the use cases first before jumping into the solutions. If you take a look at the needs across almost all organizations globally, these use cases apply whether you're an enterprise, a hospital, or education institution. Really, the common theme that cuts across all of these is easy access to people and information to get work done faster.
For example, when we look at lines of business in an organization like human resources, for example, employees can reduce their time to hiring by more than 20% by using federated HD video communication through Lync. If you look at road warriors and how difficult it is sometimes to maintain productivity while you're on the road, there's key solutions from that perspective. If you look at Polycom's new RealPresence mobile software application for tablets, that enables instantaneous secure HD video connectivity while in the field. With Lync, it not only provides anywhere access with an internet connection, but it also provides features that keep users connected, such as simultaneous ring call transfer from Lync Client to a cell phone. Lync also enables road warriors to communicate with customers and partners through federation, sustaining the same type of level of access that you would have inside the office.
Really, the bottom line across all of these is that the combined Lync and Polycom solution meets all the use cases and needs across all markets, including the enterprise, education, healthcare, and other vertical markets. Let's talk a little bit about what enables these use cases. For unified communications to truly fulfill the promise, a platform is required, and that's what both Polycom and Microsoft provide. Polycom's RealPresence platform, together with Microsoft Lync and other UC software applications and endpoints, provide the elements required to enable an end-to-end communication solution. At the core networking and security layer, if you take a look at that green bar across the bottom, that's where Polycom plugs into the network and enables the resource allocation to power our solution.
We work closely with companies like Juniper and HP to enable those solutions and optimize video communications, but we also interoperate with all standards-based network and security infrastructure. If we move up the slide into the light blue box with the title Polycom RealPresence platform, there are really five key components that cut across that platform that I wanted to spend a little bit of time on. The first box there you see is called Universal Video Collaboration. That's a software that enables multipoint video, voice, and content collaboration and connects the most people at the lowest cost at the highest quality. Moving next to the next box, you see Video Resource Management. That's a software to centrally manage, monitor, and deliver video collaboration across your organization, really the provisioning side of things and monitoring side of things. The next is Virtualized Management.
This is unique to Polycom and provides scalability and provides virtualization on your network. It provides massive scalability, up to 25,000 concurrent calls and 75,000 devices. Next is the Universal Access and Security. This is software that enables you to go outside your firewall and communicate with other businesses for B2B communication. Finally, the last box is the Video Content Management. This is the non-real-time elements of video communications and is software for secure video capture, content management, and administration for applications like training and executive communication. You notice that I talked a lot about software here, and that's where Polycom is putting a lot of emphasis. It's a software that enables us to interoperate and deliver faster innovation across this platform. We also offer advanced services, the yellow bar across the RealPresence platform.
Our UC services range from planning and design to full deployment for a joint Polycom and Microsoft Lync solution. As we move up into the Lync server application, this enables things like, as Kirk talked about, instant messaging, presence, call control, web conferencing, video collaboration, mobility, social, that are all interoperable with Polycom's RealPresence platform and Polycom endpoints. From a benefits perspective, the Polycom and Microsoft solution connect directly, and there's some key things that that enables. Rather than going through gateways, which add cost and complexity, this direct integration allows us to scale much more easily than going through gateways and offers the best user experience without any latency. This enables our voice and video solutions to easily integrate into things like Exchange and Active Directory, which lowers the total cost of ownership and eliminates those additional servers or gateways.
With direct native interoperability, you can place HD calls from video clients without the use of media gateways. You can make calls to partners and customers outside your firewall through existing federation and the Lync servers, and you can scale to many more users and calls as you don't have the bottleneck of gateways in place. Let's drill down a little bit on the solutions. From Polycom's perspective, and if you look at what we've announced just yesterday, we provide 44 different solutions that fully integrate with Microsoft Lync. Not only do these solutions integrate with Lync, but we also integrate with Microsoft Exchange and SharePoint. We leverage Exchange for calendar Lync collaboration calls. For example, you can click on a calendar event to connect to a session versus having to dial numbers.
Our RealPresence Media Manager, which I talked about in terms of recording and so forth, publishes and distributes video content on the back end and integrates with SharePoint to provide portal access and a familiar user interface. If we look at the left hand of the slide here and the voice solutions, we have a full product line of purpose-built endpoints for Lync environments called the CX product line. These products have been tested by Microsoft and have the Optimized for Microsoft Lync logo on them. This includes USB devices to use in conjunction with your PC, plug-and-play type devices, the network-connected desktop phones, to the legendary Polycom triangular-shaped conference phones.
Yesterday, we announced that we now have the full line of Polycom SIP-based SoundPoint IP desktop phones, SoundStation IP conference phones, and wireless DECT and Spectralink Wi-Fi phones are all interoperable with Lync, and I'll talk more about that in just a minute. On the right-hand side of the slide, you see the HD video solutions. Our full line of HD video endpoints and our RealPresence Platform that I just talked about have full native interoperability with Microsoft Lync. Yesterday, we also announced the availability to order the new Polycom CX7000. This is the first room video collaboration solution that is custom-built for integration with Microsoft Lync. This is the first video collaboration solution that will be qualified by Microsoft and carry that optimized for Microsoft Lync logo. Polycom is also in the process of testing our immersive telepresence solutions, our RPX, ATX, and OTX for a Microsoft Lync environment.
If we drill down deeper into the voice solutions, as I mentioned, we've expanded that voice portfolio in a Lync environment. That gives you additional options in terms of things that you can connect to the Lync environment. For example, our renowned IP phone desktop phones is a portfolio of 10 different phones that you can deploy in a Lync environment, ranging from entry- level all the way up to executive desktop phones that include video communications. The DECT and Wi-Fi phones also provide on-site wireless solutions with multiple models and price points to choose from. Our conference phones provide solutions for small, medium, and large conference rooms. In terms of options, for example, when you take a look at the desktop, our portfolio starts with entry-level solutions, starting in the price range of about $120 in North America.
If you're an existing customer and you've already deployed Polycom voice solutions, you can simply upgrade the software on your endpoints and be interoperable instantaneously with Lync. The wireless Wi-Fi and DECT handsets are a first on the Lync platform, and that gives users a much greater flexibility for vertical on-site mobile applications for things such as retail, manufacturing, hospitality, and healthcare. This provides tremendous value and a high ROI for Lync deployments in those industry-specific segments. Now, if we jump to the Polycom CX7000, as I mentioned, this is a group video solution that has Lync Client embedded in it, and it provides strong integration to not only Lync on the desktop, but also to Polycom's full line of HDX video endpoints. This is a true game changer in terms of ease of scheduling, connecting to a video conference, managing video calls for distributed work groups.
One of our CX7000 beta customers, Sebesta Blomberg, who is recognized nationally as a provider of full-service engineering and design services, provided us with some very positive feedback during our beta session. JJ Brantingham, who's a partner and CIO, states that unified communications is not about saving on travel, it's about using collaboration as a competitive advantage to drive company-wide gains in productivity, efficiency, and innovation. In just a minute, Joe will speak about the overall benefits of the joint Polycom and Microsoft Lync solution. If we take a look at what is that user experience flow when a customer enters that conference room, and what does the Polycom CX7000 do in terms of changing the game?
First of all, if you're setting up a conference, you'd basically set it up just like you're scheduling a meeting in Outlook, and you would schedule that resource, the Polycom CX7000, as a part of the resource. When you walk into that conference room, you'll see an actual full keypad as well as a mouse on the conference room table. Just as you would wake up your PC, you'd basically move the mouse or touch a keypad, and that first screenshot would pop up, and you'd see a schedule of all of the conferences that were scheduled for that specific room during the day. You'd double-click on your conference, and that would automatically add you into the session and start up the video communication.
You can also go to an IM session, instant messaging, you'd be able to see presence, access your corporate directory, and actually drag and drop people in and out of the conference, so you have control to do that. Once you start up the conference, you have, of course, high-quality, reliable, and secure video communications, and you have the capability to share and collaborate. You can share a document, you can enable multi-points and have multiple sites, and do true collaboration in terms of changing a document, a presentation, things of that sort from different locations. This is truly a game changer and provides a new solution for the conference room. In summary, the joint Microsoft and Polycom solution provides broad interoperability to ensure a smooth deployment for customers, a simple, intuitive user experience, and a lower total cost of ownership.
As we kind of discussed through this webinar so far, this solution provides secure, reliable, real-time, as well as non-real-time communication that spans across multiple use case scenarios from knowledge workers to teleworkers, road warriors, real-time and non-real-time training, and applications from instant messaging to voice communications to video and data communication. The Polycom and Lync solution provides more flexibility and operational control with open interoperability and a broad portfolio of solutions and centralized management. This solution ushers in a new connected experience that can transform every communication into an interaction that is more collaborative, engaging, and accessible. A single user interface unites voice, instant messaging, video, and web conferencing into a richer, more contextual offering. Also, with a single identity, it makes it easier for users to find contacts, check their availability, and click to connect with them.
At this point, I'd like to introduce Joe Hamblin, who is the Senior Manager, Enterprise Communications and Collaboration at Sprint. Joe will take us through a case study showing the joint Microsoft solution in action and the results that Sprint has enjoyed today. Joe, I'll turn it over to you.
Thanks, Jim. Good morning, and I appreciate the opportunity to share our Sprint story with my IT peers. I'm going to give you guys kind of a background on where we came from, the things that we did. Let this thing update here for me. Sorry, guys. I'm going to probably have to have you guys push it for me, Jim. It looks like for some reason, here we go. Okay, sorry. Real quick, I want to give you guys some background. Obviously, I've been with Sprint 24 years, primarily in the voice industry. Prior to that, I come from the old interconnect business. Those of you that have been around long enough to know things like TIE and NEC and some of those things that go back those days in 1A2Q, that's where I came from.
I'm not sharing that with you to give you my resume, but I do want to kind of level set where we come from thinking about this from voice and collaboration tools. As many of you know, as IT guys, we have a tendency to have our biases based on part of the industry that we grew up in. For us, most of the folks that drove our strategy for unified communications and collaboration, we drove it out of more of the voice engineering solution. Just a quick level set there. I want to real quickly provide you kind of what unified communications and collaboration means to us here at Sprint. As you talk to different vendors, read the different trade rags, you're going to get a different definition, different interpretation. For us here at Sprint, really internally, it is any tool we use to communicate and collaborate.
I will even include things like social networking now. You continue to think about how the media and those types of things become relevant to us. We're constantly in a perpetual chat mode, and those are the things that we're looking at continuing to bring into our environment. How do we communicate quicker, faster, and better? For us IT folks, we typically get money for two reasons. It's broke or we got a compelling ROI that says this is the right solution that we need to go with, and we can actually put something together. At the end of the day, by improving our communications and collaboration capabilities, we improve our ability to make decisions faster, and that's one of the things that drives our goals and our drivers here at Sprint.
Let's look at where we were in 2006, and we actually started doing our unified communication story dates clear back to live communication server. One of the things that we were looking at back then was, as we go through the budgeting cycle each year, and all of us do it, what we discovered was our expenses kept going up, maintaining those 490 Nortel PBXs that we had out there. Also, my user community, the way they worked, the way they were conducting their business had changed. We were no longer working in our offices like we used to. What we found was that people were trying to conduct their business from anywhere but in the office. We had a lot of different challenges trying to keep up with the pace of our business. PBXs no longer met our needs.
We had out there roughly 18 symposium call centers, 19 call pilots that we had networked using our network. We had a lot of different hardware and software. Trying to keep this infrastructure up to date was very difficult. As you can imagine, no more than get done doing the upgrade process, you're back out there doing it again. Every two and a half years to three years, you're doing an upgrade to all this infrastructure. Expensive to do it, the upgrades, the support costs, the skill sets keeping my staff trained. I had nearly 30 engineers, voice engineers dedicated to keeping this environment running scattered across the country, and that was their sole purpose. The travel that went into it, all of those expenses, you guys understand those pieces. The high network costs, every one of those sites required PRI services, they required dedicated T1s coming into them.
The exciting cost to go into those, like the red dots that you might see on your presentation, the smaller option 11s, those actually out there would run me anywhere from $1,200 to $1,500 a month recurring, money leaving my company, going to my competitors. Those are the things that we wanted to target. Again, I'm IT. I've got to focus on driving costs out of the business first, and that is the key piece for us. We always start there. Now, if we can improve other things, the softer things, we'll do that second, but I have to stay focused on driving costs out of the business and being more efficient, doing more with less. I think each one of us are challenged with that. The other thing I want to do is get out of the moves adds and change business.
In 2007, I did nearly 8,000 internal moves adds and changes. If you can calculate, you know, going out there and physically moving a phone, those types of things, or I have to drive windshield time, you're looking at anywhere from 15 minutes if I can do it in software to 30 minutes to 1 hour if I can do it in hardware. We wanted to find a way to get out of that business and try to come up with different ways of allowing people to work where they wanted to work. Kind of borrowed the phrase, work is something you do, not someplace you go. That was something we wanted to work on there, getting the tools. Because Sprint, we sell mobility, that's our lifeblood. We're all about mobility, so we wanted to take those same tools that we're doing internally and provide that to our users.
The other thing we did, we partnered with our real estate folks, and what we learned from working with them, the information we got is people were no longer in their cubes. Like I said earlier, they're working, but they're working from Starbucks, they're working from their favorite coffee shop and restaurant, they're working from home, they're out on customer site, they're not in their cubes. We wanted to partner with our real estate folks and come up with different ways to solve these problems. Like every IT organization, we lay out a vision every year, and what we did back in 2006 and 2007 is we said, "Okay, where do we want to be in 2010?" I'm always challenging my team. Where do we want to be now in 2014? What does this model look like, especially as we start thinking about the consumerization of IT?
What do we continually want to do? Today, we're going to solve today's business problems, but we also want to put ourselves on the right roadmap that we can continue to drive costs out of the business and we can continue to deliver value to our young users, my customers that wear the Sprint badges. Again, as IT, we focus first and foremost on reducing costs. We've got to start there. Again, I get money for two reasons. It's broke or I got a compelling ROI. When we sat down in 2006 and started looking at the different solutions that were out there, we knew we wanted to get centralized. That was the key thing. In 2006, many of you know, unified communications was kind of an emerging thought and kind of an emerging technology. Nobody really knew what it meant yet.
What we really wanted to look at was how do we take and go from all these decentralized PBXs and come up with a very centralized solution that we can manage with less support and less infrastructure. We spent a lot of time looking at the traditional VoIP solutions, and we came up with no less than four business cases, and all four of them failed miserably because of the cost to deploy them. We were nearly $25 million to get rid of those 490 PBXs. Had a five-year ROI, but the key piece for us when we looked at it was 70% of that capital expenditure was around handset replacement. Taking an old Nortel TDM handset that worked and trying to replace it with a pick-your-favorite vendor, a VoIP handset that was still tethered to a wall jack that didn't necessarily meet all of our mobility needs.
That was the challenge we kept running into, and we never could quite find the right solution that said, "Here's where we wanted to go." At the same time, we were also working with a lot of soft clients, and we had worked with the major manufacturers from a VoIP perspective on soft clients, so we knew if 70% of our cost was in handsets, what could we do different? Our biggest goal became, "Okay, we're going to stay focused on being centralized, we're going to stay focused on using things like SIP trunking and GMPLS." We knew VoIP was the key, but how could we introduce more? How could we move people from those handsets that I've already told you my folks weren't in their cubes using anyhow to something that they could carry with them very portable? They already had to have their laptops at that time.
We focused on driving that cost out of the business by leveraging the clients that were already on our machines. We were originally thinking about the legacy stuff. Very quickly, one day we were working, and this is kind of a true story. My guys were sitting around, we were already a big IM shop using live communication server, and we happened to notice this thing inside the IM called Call. Walked over to the exchange team that was managed by a completely different group, asked them what it was all about. They said it was something for you dumb voice guys, and that was really how our story started. We ran out, we got ourselves a gateway and put it up between a PBX and put about 200 IT users on it, and we learned a lot about that UC experience from live communication server.
That's when we started having conversations with Microsoft saying, "Okay, where are you going with this? It's already built in, I own it, it's in my environment. How do I take advantage of this and what lies in store?" That's when they introduced us to OCS R1. Here's kind of the initial results for us. When you look at what we did, obviously, again, going centralized was key for us. We centralized not only our infrastructure, we centralized our management. I went from the 30 voice engineers I had scattered across the country, along with the support contractors and technicians, to now I have 22 people that work for me. They manage Exchange 2010, Lync 2010, SharePoint. We also have our Polycom infrastructure that we use. I have 55 Polycom rooms scattered across the country that we also are able to take advantage of and tie back into our infrastructure.
The next piece was we drove nearly $6 million out of our business in electric charges. Those costs, even though I own a long-distance network, a fiber optic network, those PRIs that I was having to license, those were going to my competitors. That was money I was able to return back to Sprint by leveraging our internal SIP trunking and bring those dollars back in. Got out of the moves, adds, and changes business. We now have really worked with our real estate folks to drive additional costs out of the business that I'll share with you a little bit later. The main thing there is by taking our space and making it more open, taking the names off the cubes, giving people the headsets, allowing them to move around and take advantage of, we've done a few things.
First, we've taken space that at one time would have maybe housed 75 people. Now it holds maybe 150 people because of the way we work. We have the ability to do that. The other things that we were able to do is take a lot of the space that would have been offices and rededicate those to teaming rooms. I have the Exchange team and the Lync team. Each one has their own room. It's the way they like to work. They have their own hard wall area with whiteboards, and they can go in there and sit face-to-face, and that's how they spend their day. Now they're not required to, they can also work from home. I manage them by presence. I'm able to connect to them in any form of communications I want, whether it be IM, email, video, voice, obviously.
By the way, if they step away, I'm able to use things like SIM Ring to allow me to find them anywhere, any place. I don't have to necessarily see these folks. I'm able to see them. It's just a different way of managing. That way for me to manage my guys is really through presence. This slide here, I want to leave you with just some key thoughts. Each one of us in IT, I talk to our peers all the time about this strategy and what we've done here. I probably do two to three presentations a week for people. One of the things I want everybody to kind of take away is all of us are on this journey somewhere, and this is a journey.
When you start this process, you guys are going to look at it and say, "Okay, I'm going to install this and I'm done." You're not done. You're going to install this, and you're going to go from the yesterday, which was very much where I came from, where I managed the voice world, my peers at that time would have managed Exchange and the network. Those guys, you know, we never really would have talked to each other. I wouldn't have talked to the Exchange guy unless I had an email problem. He wouldn't have come to me unless he had a voice problem. You're going to change your world as you start down this journey. Today, my team is very much in the integrated piece. Again, we manage that entire Microsoft and Polycom environment internally here.
Tomorrow, where we're going, this is about, and I think this is a real key part, and this is a hard part to sell. This is the softer stuff, but it's really around transformation. You think about this click-to-call, click-to-collaborate capabilities that we have. We want to drive those into our business processes. We want to take our customer record management systems and put that same click-to-collaborate tool inside there, so you don't have to leave that screen to go find a subject matter expert. You don't have to bring up another window. You don't have to go and look through the directory. You can already see somebody's AD ID. Maybe they updated a customer record, and their presence information is already in there off their ID. Rather than going to look them up, I can click to contact them.
Oh, by the way, I can give them contextual information on why I'm contacting them. Those are the things we're thinking about. The other thing that we're trying to do, when you look at the 55 Polycom rooms that I have set up across the country today, our utilization on those has not been where we want. As a matter of fact, it's been very low. Part of the challenge that we see, and this is why we're so excited about going to the new HD and the Polycom CX7000 series equipment, is I can now integrate it into Microsoft Lync, but I can also integrate it into Exchange, so my scheduling of these rooms, the utilization of these rooms becomes so much easier, so much simpler for my folks to walk in there.
They don't have to be intimidated by this big controller, TV remote, and how to set up a call. They can walk in there, hit click to call, their calls get set up, they join the meetings, they're able to push content just like they do from their desktop. I can have folks participate from anywhere in the world, and I think this is one of the key things I want you to take away. As you look for what you want your company to be in 2013 and 2014, you have to think about it from an IT perspective. Yeah, we want to drive costs out of the business, but how can we put ourselves in an advantage to give our company a competitive advantage? We're going to be competing for young men and women coming out of these universities. This is the way they work.
They're used to working through social networking, they're used to working through things that video chats and Twitters. We have to create environments that's going to attract those types of people that we want to bring in. Oh, by the way, I don't have to bring them to Kansas City to work. I can attract those types of talent from anywhere in the world because they're able to participate and share and gather information and share that information on the fly. I don't have to have them in Kansas anymore. I'm able to recruit and find people anywhere. Areas of opportunities, so this is things that you can think of.
These are actual facts that we drove out of our business here at Sprint and areas I would encourage you to look at in your company as you move forward with the unified communications story of your own and put these in place. Obviously, you want to look at your let costs. First and foremost, SIP trunking drove out $6.7 million, and I did a couple of different things there. Some of them we got new numbers, and then some of them I ported numbers. My sales folks, obviously, they wanted to keep their numbers, so we had to do a port there. A little bit longer lead time, I would encourage you there as you're working through those pieces. Plan on about 30 days- 45 days to get those requests in to get those numbers ported.
If you can give your folks new numbers, it makes it a little bit easier from the transition because remember, you know I've driven out nearly 300 and some PBXs out of my environment. I've got another 120 I've got to get rid of by the end of first quarter next year. We'll be doing seven, eight, nine PBXs every month to get those completed. I'm Microsoft's largest PBX displacement customer out there in the world right now. When you go to make those changes, you're picking up that person's telephone, you're handing them a headset. If you can give them a new number, it allows you to have the opportunity for those folks to come up to speed. You can give them a little bit, maybe a week, two weeks, don't make it too long because it does cost you money to run that dual network environment.
If you can't, you know, you try them in advance, you give them the headset. Most of your folks that are already using IM, they're going to be very comfortable with it. All you're doing is giving them new capabilities. Audio conferencing was another piece. I do 5.2 million minutes a week in audio conferencing. Now I've taken my audio conferencing, I've internalized that. I would have been spending that $3 million annually with a third party. I've brought all that internal now. Oh, by the way, I'm not only doing the audio conferencing, I'm also giving the piece to share and collaborate and push content to each other. I got off the treadmill, and you can too, of doing those PBX upgrades. About $2.5 million annually is what I put in the business case.
Really, I could have spent $2.5 million just in Kansas City alone on the PBXs and infrastructure I had here. Green savings, you know, Sprint is very aggressive in this area, and we're always trying to be a leader. I think we are number three as far as Fortune 500 companies in the green space. This is really key for us and fundamental for us. We want to try to do the right thing for the environment. $700,000 annually, power and cooling costs that we were able to return. If you think about those individual PBXs out there, an old Option 11 would cost you about $500 annually to cool and power. An Option 81 that we had scattered across the country, that might cost you somewhere in the neighborhood of $8,000- $10,000 annually to cool and power. Get out of the moves ads and change business.
You know, that changes every year. You're going to have to look at your historical data as you put that part into your business case, and I would probably average it out over three to five years what you've done. For us, what we did is we just said, "Hey, you know, let's say $6,000." That was pretty average for us. If we just said, "Hey, $600,000," and we tried to keep it very simple, something we could get our heads around. The other piece, again, you want to extend your borders beyond just the IT world. Talk to your folks who manage your real estate organizations. By partnering with them, Sprint has been able to drive out. We've got $20 million here. I've talked to my peer over in real estate, it's closer to $30 million. A couple of different strategies we did there.
In the field where you saw a lot of those red dots, if those were sales offices with 25 people or less, we closed them and sent them home. Now, unified communications wasn't the total driver, but it was the enabler. It allowed people to go home and still have the same tools they would have had in their office to do all their communications and collaboration. That's a key piece, and I encourage you to look at those areas. The other piece, again, is look at more open office seatings. I come to the Sprint campus every day. I don't have an office with my name on it. I have an area, kind of a bulletin area I like to report to. If I want a window seat, I just get here early.
Those types of things that we've dealt with in the past in the IT organizations, when somebody would move and restructure, "Okay, if this person moves and somebody else wants to move, take their cube," that domino effect. I've gotten out of that, and those are things that you can also do in your environment. We'll move here to my last slide and leave you with some thoughts. Stakeholder buy-in, guys, you need to make sure you have all your folks on board. Human Resources, why is Human Resources important? You're giving capabilities that allow people to always be on, whether they're using their personal wireless device, whether they're using their laptop.
You have to think about if you're putting this in the hands of people who are hourly employees, if they are getting email over their devices, if they're getting IMs over their devices, by all rights, they should be charging for that time. Think about that, who you're putting this in the hands of. Make sure your human resource folks know that, "Hey, these are the things and the capabilities we're rolling out." Enlist corporate com, your corporate communications teams. We have a tendency in IT that, "Hey, it makes sense to us," and we speak a lot of IT speak. Bring the corporate com folks in. Help them help you craft a message that makes sense to the masses. The last thing we want to do is make our folks have to become IT experts to use this stuff.
I think that's the key, is we have taken tools that they're so used to using with the click-to-calls and the click-to-collaborate capabilities that it's a very easy transformation. Make sure your corporate com folks help you with that, crafting that. Keep your legal folks involved, things around E911, those types of things. Make sure they understand how you're solving that problem with location-based servers and those types of things. Again, partner with your real estate folks because it really is a strategy that goes beyond your IT borders. Do not underestimate end-user adoption, guys. That's a big key. I put this up here kind of jokingly.
Change is good until it happens to you, but when you walk into somebody's cube and you start taking away their phone and you say, "Hey, this is how you're going to communicate now with this headset and those types of things," it's change. It's changed that if they understand your story and they understand why you're doing it and the capabilities you're going to give them, they will adopt it. For some, it's harder. It could be a, you know, I hate to be this way, but it could be kind of an age thing. My younger employees coming in, they love it, they get it. Some of the guys like myself that have been here a while were a little bit slower. You got to really craft your message and work on that end-user adoption piece. Do not underestimate the training. The technology is not the challenge.
The backend infrastructure is not the challenge. This stuff works, guys. This is the piece you got to focus on, what makes sense for your users. Focus on those areas, bring in the experts you need to do the backend to help you make that right. If you get your end-user experience right and you have a satisfied customer, that's where you want to target. Having a backend infrastructure that's fully redundant and do all these things and all the backup does not buy you anything if your end users cannot take advantage of it. You're going to change the way you do some work. Obviously, network analysis, do those upfront. Make sure you're looking at the sites before you convert them. Make sure you get enough bandwidth out there. MPLS is obviously a key. Leverage QoS. Make sure you're doing packet tagging.
We did a lot of stuff with Microsoft in the early OCS R1 and R2 days to do packet tagging for old XP machines and those types of things. Windows 7 machines, you're going to be a whole lot further ahead if you were there. We've got a lot of XP machines. Most of the machines I've got at Sprint are still XP, but we had to go back and do some things with some packet tagging. We had to look at the different latencies and make sure your network's right. Support tools, you're going to bring in some new things. You're going to train your folks to troubleshoot differently. Wireshark, some of the things we're using, Snooper, SCOM, the Microsoft SCOM, and now we're starting off to use SCCM.
Quality of experience and your customer data records, those are very useful tools inside of SCOM that you can pull out the information. I would encourage you to use something like a Sniffer or some other network analyzer to help you because now you're dealing with, "Here's what's going to change in your world," and these are the things that you got to think about as you start breaking down your silos. This is one thing that I would encourage each of you to do when you think about troubleshooting this. When there is an issue out there, it's going to show up probably in your UC organization first. I'll give you an example. Somebody calls me and says, "Hey, there's a voice quality problem in this building." UC doesn't work that way.
I either have all of my users having an issue or I have a network problem in a building, but the ticket shows up in my organization first. You have to bring in folks who understand the desktop piece, the voice piece, the network piece. All of those things need to come together when you redo your organizations to start supporting an environment like this. Obviously, look at your support structure for your Tier 1, Tier 2, and Tier 3. My folks handle all the Tier 2 and Tier 3. Anything we can't handle, obviously we take back either to Polycom if it's video related or we take back to Microsoft if it's something on our infrastructure side. Your alerting and monitoring pieces. Most of those things you guys get.
If there's anything I can do to help, if there's any shortcuts we can share with you, I mean, there's no secret here. We're happy to do it, and we do it all the time for many of our friends and colleagues out there in the IT world. With that, Jim, I'm going to turn it back over to you, and I hope that was useful.
Excellent, Joe. Thank you so much for joining us today, and congratulations to you and the Sprint team for driving those tremendous results. We're running a little bit over time here, so we're just going to do a quick wrap-up. We did receive a tremendous amount of questions. Unfortunately, we're not going to have time to go through those live questions here on the call, but we will answer all of them individually offline, so be rest assured that we'll do that. Today, we heard about how Microsoft and Polycom are joining together to improve productivity, have high ROI, provide greater choice, and investment protection. One of the things that we'd like to invite you to do is to send us an email if you'd like to get a demonstration either at a Microsoft Technology Center or a Polycom Executive Briefing Center. Visit polycom.com/microsoft for more information.
We will be sending out a follow-up email that will include the presentation, and again, we will answer all questions. Thank you very much for joining us today. We really appreciate it, and have a great rest of the day. Bye-bye.