Peter Radizeski is Founder and President of RAD-INFO INC. He is an accomplished blogalyst, speaker, author and consultant. He has helped many service providers with sales training, marketing, channel development and business strategy. He is a trusted source of knowledge about the telecom sector. His honest and direct approach make him a refreshing speaker.

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Is On-Premise Dead?

The noise level of hype about UCaaS sales is high. Another analyst report sales it is over 30% growth — yet not one provider has demonstrated that in their numbers!

“Let’s Talk About the Looming Death of the PBX.” Is on-premise dead? It’s pretty inexpensive to install and maintain Asterisk and 3CX. Avaya didn’t close; they went into bankruptcy. Windstream and Frontier are heading that way. Is telecom dead?

Mitel, NEC, Zultys, Star2Star (hybrid) and Fonality round out the PBX guys still kicking. By the way, has Cisco put an end of life on Call Manager? Yeah, no.

If it is so grand, why did BSFT sell? Why are 8×8, RC and Vonage looking to exit?

“It’s time to go all in on UCaaS. Not convinced?” No. I am not. Just like how cloud is a blanket term, so is UCaaS. Hybrid wins. It has been that way forever.

I think CPaaS – defined as SIP Trunking with features – is going to win the game. (I’m not alone either.) Why? The world is being eaten by software. It will be the software that wins. Voice, video, text and other types of features will be add-ons to the software running the business.

UCaaS provider want to be all things to all things. Well, that’s dial-tone. Verticals and full stacks are where the gold is. It isn’t like 8×8, RC and Vonage don’t know that! It’s just they don’t want to abandon the WHOLE market because Wall Street will kill them. When you say that the addressable market is $30B, you can’t take a position that you are going to take a chunk of just $1B. Or at least no one has had the balls to do it yet. They’d rather swim in the same shallow pool with the other 2000 providers. I guess they would get lonely.

Another point: Cloud is about Worldview. Some people feel safe in the cloud; others do not. Some techs worry about job security, so on-premise is there answer to job security. SMB SaaS Survey says that 21 percent said cost was a barrier to implementing a cloud-based solution; and
53 percent said security was an issue.

The TCO on UCaaS is not a cost savings as so many have claimed for so long. At $34 per seat, how is a SIP Trunk not less expensive? Most folks do not need all those features. Voicemail is annoying.

Learn a new system. Learn a new phone. That is Change! No one likes Change!

“UCaaS customers will be with their provider much longer than they kept their PBX.” You think someone still using a Nortel believes that? Or someone with a ten year old key system?

The churn numbers don’t match that. In fact, customer retention is one of the biggest issues facing the industry. The service delivery has holes. User training is needed for user adoption, but it is often over-looked or an expensive add-on. And it happens once, instead of regularly over the course of the contract. Employees churn in other industries besides just telecom, folks.

It isn’t that I don’t like UCaaS. I just think that it too often gets sold on price because of a lack of vertical integration; positioning; and business case impact.

I am tired from all the hype around a garbage can term like UCaaS that doesn’t mean ANYTHING to the buyer.

All too often, we think cloud means jam your box in the data center. That isn’t cloud!!! That is hosted at best and relocated. Let’s replace your PBX by selling you a cloud one is like saying ACT! was replaced by Salesforce.

There are a number of good reasons for a business to choose cloud comms, but using myths to sell it makes you untrustworthy.

And on bigger deals (200+ seats): How low was that seat price? How many seats actually turned up in 120 days? Did the partner get the full commission and spiff or did he just get based on a percentage of the deal?


Sellecom: 101 Ideas for Marketing in the Telecom Jungle by Peter RadizeskiSELLECOM: 101 Ideas for Marketing in the Telecom Jungle.

by Peter Radizeski