Several SIP extensions are under development by the Internet Engineering Task Force. What new features of SIP are you most excited about?

One of the big things has been adding functionality to the phone. Initially with SIP, the phone was pretty much a dumb device. Software from companies like Interactive Intelligence run on the desktop, and they let you see who is calling and the real-time status of people in the organization. But there are still some people in this world that don't have computers at their desks. Now SIP is getting functionality to add those features to the phone itself. For example, you can have a button on your phone that flashes when a call comes in from your boss. Phones are becoming little computers in their own right.

What can we expect to see from Interactive Intelligence next year?

We're going to come out with a new version of our flagship platform. The biggest theme of that announcement will be security. Our customers are really pressing us to adopt security standards. In the VOIP world, there is a standard called Secure RTP that encrypts phone calls that we will be adopting. Another big theme is our relentless push to increase scalability. We have big customers like Microsoft and Motorola that say supporting 10,000 users at a location isn't enough. They want us to support 40,000.

Which of your products are driving demand?

The demand is across the board. Organizations of all stripes are making the move to VOIP. Given the strategic important of contact centers, especially within large companies, that's often where the evolution to VOIP begins. We see activity in every vertical. We have particular strength in financial services, higher education and technology. Harvard University, Ohio State, Microsoft, Oracle and Motorola are all customers.

Founded in 1994, Interactive Intelligence weathered the dot-com boom and bust. What is your view of the health of the Internet industry today?

There's a marked difference from where things were at during the height of the lunacy back in 2000. There are still some companies that capture the imagination and seem to float on air these days, but I think investors are a lot more savvy. When I founded the company in 1994, the VOIP products that were on the market were novelties. The standards that were in place were so complex or had poor performance, so we elected to wait until something better came along. We jumped onto SIP in 1999, because we felt that was where the future was going. We had to bide our time until SIP reached a critical mass and some of the infrastructure had evolved to allow us to come out with an effective software system that can scale. That's a big change for us compared to five years ago. Back then we could handle a 300-person contact center, whereas today we're handling tens of thousands of people at large companies like Microsoft and BMW.

Interactive Intelligence is the only publicly traded software company in Indiana. Is it a challenge for you to be alone in the Midwest?

There are some challenges in terms of building relationships with others in the industry and in terms of public relations. If we were in Palo Alto, we would be much more commonly covered in industry periodicals. But there are good aspects of being in Indiana. We have a tremendously stable workforce. Our core engineering team has been with us for 10 or 11 years. That's unheard of on the coasts, where they struggle to keep people long enough to finish a project. Indiana universities -- Purdue, IU, Rose-Hulman, Notre Dame -- are producing some awfully good technical people. Our challenge is to keep them from going off to one of the coasts.

Does your medical degree ever come in handy when running an IT company? (Dr. Brown graduated from Indiana University School of Medicine in 1985. He has a master's degree in computer science and a bachelor's degree in physics.)

Not really. When I'm selling into the healthcare industry, I can speak the language. It's more of a novelty than anything.

You're a serial entrepreneur, having previously founded software companies that were acquired by EDS and IBM. What's different about the entrepreneurial environment today compared to 10 or 15 years ago?

There is better investment potential. There's more venture funding and angel funding, which makes it easier for someone starting today. I didn't have that situation 12 years ago, because I was the venture capitalist for Interactive Intelligence.