Fax machines are a great example of the network effect. If you're the only person you know who has one, it's not worth much. However, as more people get fax machines, they all become more useful. That helps explain why there are still fax machines infesting offices worldwide. But weren't we supposed to have paperless offices by now?

Microsoft took a leap of faith when it shipped inbound fax as part of Exchange Server 2007. Unifying voicemail, faxes, and email sounded like a great idea, but in practice not that many customers deployed Exchange 2007's faxing features. In fact, I have yet to find an Exchange 2007 deployment in North America that actually uses Exchange unified messaging (UM) faxing. I believe there's one simple reason for this lack: The feature is inbound-only. If you have to do all the work of deploying an outbound fax solution anyway, the value of inbound fax support in Exchange UM is quite a bit lower. (Things are slightly different in Europe and the rest of the world, where faxes are still a common method of business communication).

You might have heard that Exchange Server 2010 won't support inbound fax. On the surface, this news sounds like a classic example of a vendor taking away a desirable feature. However, the feature's not really gone, it's just changed.

Exchange 2010 won't create fax messages itself. However, there's a twist: You can outsource your fax over IP (FoIP) capabilities to a compatible service provider. Exchange 2010 will honor any existing Exchange 2007 UM fax configuration properties, and it will continue to recognize fax CNG tones. However, instead of answering the call itself, UM looks at a new configuration property defined on UM mailbox policy objects: FaxServerURI. If this property exists, UM tries to hand off the call to the specified fax service. The external fax solution establishes a fax media session with the sender, creates a fax message, and sends it to the UM-enabled user's mailbox.

Messages created by this method look basically just like Exchange 2007 UM fax messages, and they appear in the Fax search folder in Outlook just as existing messages do.

The foregoing discussion might lead you to wonder who's going to offer FoIP services that work with Exchange 2010. I haven't seen a list yet. However, Concord Technologies sent out a press release at the Worldwide Partner Conference touting the fact that they'd be offering an Exchange 2010–compatible solution, so I guess we can count them in. There will undoubtedly be others.

Davidson Consulting claims that the FoIP market is set to grow at a 12.1 percent compound annual growth rate between now and 2013, yielding a nearly $1.6 billion market by then. Exchange 2010 is well positioned to take advantage of that trend by letting you choose a service provider based on cost, service quality, or whatever other metrics are important to you, then handling the work of distributing the fax as an Exchange message.

Personally, I'm done with faxes. I'm still waiting, however, for my Star Trek–style matter transporter. Talk about network effects!