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“Peter possesses a keen sense and insight for turning telecom services and products into customers and dollars. He is passionate about this industry, his work and the people he serves. Visit his site, read his blog and sign up for his newsletter at marketingideaguy.com and you will discover what makes Peter a sought after marketing consultant.”

Cynthia de Lorenzi, CEO, Patriot Computer Group

You Won't Believe This Stuff
NSP Strategist
Tuesday, 20 March 2012 06:53

Interesting maghttp://www.blogger.com/img/blank.gif. OTT video is about content -- if you don't have what people want to pay for, they won't. "That in a few days Netflix will lose its rights to carry Starz video content, including my daughter’s favorite Disney films, offers yet more evidence." Comcast has size and distribution. The cablecos and telcos control the bits and pipes. They paid big money for video distribution; they want to see an ROI on that. They don't want Apple, Google, Amazon or Netflix to have it. They also don't want OTT VoIP, but that is a tricky business to play with, since cable has already been caught once playing with Vonage - and it didn't go well PR-wise.

"They adopt a predictable pattern--they let someone introduce a new service, watch the market grow, and much later step in and take away the opportunity. This is how cable companies beat out TiVo (which introduced the world to the DVR) and Vonage (which convinced Americans to embrace VoIP)." Keep that in mind as you partner with cable because you are frustrated with ILEC.

MSP's are looking at offering email marketing to SMB. "SMBs are in need of some serious assistance with their email marketing activities, which could present an excellent growth opportunity for MSPs serving this market. At least these are the conclusions which can be drawn from a recent study by email marketing platform provider GetResponse." Just another way to be sticky. You can partner with a freelancer to provide this.

Cable is following telco into home security and home automation. Comcast, TWC and Bright House are entering home security after Verizon. Comcast is reselling iControl.

In case you missed it, VZ is offering Fixed LTE as a broadband choice in rural and non-Verizon regions. Despite the complaints that they don't have enough bandwidth. Also, they need more customers so it is time to expand into other ILEC territories.

The VZ-SpectrumCo spectrum deal, which would result in a joint venture company that co-markets each others products, is under FCC scrutiny (as it should be). This will wipe out competition.

Some new government guidelines for EHR (EMR) here.

Is ISP Six Strikes Plan an Antitrust Violation? "Most of the largest ISPs are set to begin ramping up a new anti-piracy effort in July that could involve filtering access to websites or throttling the connections of suspected pirates." apparently, they all got together with the RIAA and MPAA to come up with this plan. Look for much more encrypted data to transverse your network.

NetZero is at it again with free 3G/4G broadband via Clearwire WiMax network. Have you seen that Republic Wireless, owned by Bandwidth.com, is offering a really cheap $20 wireless (not really cell) service. It uses Wi-Fi as much as possible and is metered.

Peter Radizeski is a telecommunications consultant and analyst with RAD-INFO INC. Service Providers have called on RAD-INFO INC for assistance building a channel, improving sales, managing online marketing efforts, and overall company strategy. Contact RAD-INFO INC at 813-963-5884 or http://rad-info.net

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What a Crazy Monday
On Rad's Radar
Monday, 19 March 2012 10:02

So Zayo is buying AboveNet for $2.2B.

Avaya bought RADVision for $230M. Conferencing is making a lot of noise. As David Byrd points out, "It is clear that video conferencing is growing in importance in the market.... is the market big enough to support them and others attempting to stake out market share. Vidyo, ooVoo, Skype, Polycom, ShoreTel and others are all battling it out to deliver video conferencing either as a desktop offering or major telepresence in conference rooms." Byrd forgot Google, who has made video chat with G+ Hangouts stupid easy. Easier than Skype, since there isn't any software to download.

AT&T quietly settles the iPhone data cap case. Quietly because they don't want a rash of these lawsuits, even if it only costs $900 to settle. Will there be a rush to the small claims courts?

This headline killed it this morning: "Bernstein Downgrades Sprint, Notes Bankruptcy Risk". It being Sprint's stock, which dropped. Is Sprint in risk of BK? Not in the near term (2012 or 2013). Maybe in 2014 if it has to pay Apple for unused iPhones. See Bernstein thinks that the iPhone 5 which will utilize the 4G network will hurt Sprint who doesn't yet have a nationwide 4G network. Why not? Sprint just opted out of the LightSquared deal that the federal government all but kaboshed. Clearwire can't get it's act together. (Even with a deal with NetZero for free 4G data!) Bernstein stated that Sprint didn't have spectrum for 4G, which isn't true, since Clearwire has Sprint's spectrum combined with others to have a big chunk in most markets. Also, with roaming agreements in place, Sprint can use AT&T or other 4G carriers, although that will be costly. Sprint has a Brand isuue. Not to mention an under-utilized fiber network. BTW, CNET has a story about the 4G spectrum issues.

LightSquared has chosen to yell at the FCC and demand replacement spectrum. LightSquared said that the FCC action violates its constitutional property rights. What a bunch of BS!! The DOD said you can't use the spectrum. Period. You don't OWN the spectrum. You have a license to USE the spectrum - as it was deemed in said license. The LightSquared spectrum was licensed for satellite usage, not terrestrial broadband usage. "LightSquared's spectrum holdings (between 1525MHz and 1660.5 MHz) are close to the GPS satellite signals," reported ARS. And even more about the challenge that LightSquared faces from the Laws of Physics. LightSquared has offered to swap spectrum with the Dept. of Defense.. Corporate welfare clowns annoy me.

Creditors Want Zenith Infotech to Liquidate

Read more... [What a Crazy Monday]
 
An Interview with StartMeeting
On Rad's Radar
Monday, 19 March 2012 09:40

SM_Logo_Print[1] copy 2.jpg

I had a long talk with Greg Plum, new VP of Channel Development at sart-up, SmartMeeting.com at ITEXPO East. He agreed to a short interview.

What's the special sauce for StartMeeting?

StartMeeting incorporates components of web conferencing that have become familiar and trusted, while introducing some new features, including fully integrated toll, toll-free, and HD VoIP audio options, custom greeting and on-hold music, and a fully customizable meeting wall for meeting hosts, all at price points well below the industry.

Why should agents and VARs choose to sell StartMeeting over other web conferencing options?

StartMeeting offers a simple, intuitive, and effective communications solution. Our aggressive pricing, starting at $19.95 per month for a 50 seat license, coupled with a reliable, fully-integrated, audio bridge, will get a prospect's attention. Our differences, including HD audio, social platform integration, and our customizable meeting wall, will make them loyal, long-term customers. Since ease of sale is paramount to the agent, our proprietary provisioning system affords the agent 80 pricing scenarios, paying commissions ranging from 25% to 35%, all via a promo code matrix. It doesn't get any easier than this.

Name one sales trigger for web conferencing.

When a prospect tells an agent they are using ANY web conferencing solution, the agent should recognize this as an opportunity to win this prospect as a customer and save them money by offering StartMeeting. This could also be used to get the attention of a seemingly impervious prospect. Agents can now show them something different... Disruptively different.

CALL TO ACTION: StartMeeting will be offering free demo accounts to agents and VAR's who visit our booth (#331) at the Channel Partners Conference at Caesar's Palace in Las Vegas, March 27-29, 2012.

The other interesting tidbit is that StartMeeting is owned by the same folks that bring you FreeConference.com.

Read more... [An Interview with StartMeeting]
 
Zayo Buys AboveNet
On Rad's Radar
Monday, 19 March 2012 07:31

It was a big surprise this morning to hear that Zayo bought AboveNet for $2.2B. My first thought was "Where did Zayo get the money?" I mean, the Dealbook writes, "As of Dec. 31, Zayo had about $25.9 million in cash and short-term investments, along with $682.7 million in long-term debt. It currently has a credit rating of B2." Apparently, Zayo backers and bankers went into their reserves to buy AboveNet. I guess the heady days of Bain LBO is back, thanks Mitt! (LBO is leveraged buy out).

AboveNet was one of the few fiber shops that had its act together. They know where their fiber is. They can quote it fast. They can deliver on what's quoted. And they knew their sweet spot. Except for US Carrier and FiberLight, no other fiber CLEC's that I have dealt with can say that. (I'm waiting over 6 weeks for quotes and maps from IFN and L3.)

This will be Zayo's 21st acquisition. I hope the integration goes well, because in the past Zayo has had issues with their knowledge of fiber assets. It has improved. Google earth!!

Zayo doesn't sell via the Channel - direct sales only. Via email from Dan Caruso, when asked about the Channel this morning, "I am sure we will be supportive of efforts Abovenet has underway."

Rob Powell likes this deal, even at 9.2x projected 2012 EBITDA. I think scale for scales sake is the problem with telecom. Mounting debt combined with shrinking prices does not make for a healthy business. Zayo and Level3 are buying up a lot of the competition, but that hasn't really increased pricing because Cogent and resellers are still there dropping their pants to win any revenue. And the ILECs are in a price war with the cablecos.

I mainly sell transit and transport. Fiber companies are my bread and butter. It is certainly easier to just check a single fiber map, as opposed to a number of them. Here's hoping for a smooth integration.

DEBT

The debt in this industry is crazy. AT&T and VZ combined have $105 Billion in debt. The top 5 MSO's have about $100B with Comcast at $40B. Level3 is at $8.5B. WIND has $9B. CenturyLink has $22B. When you are paying 7.75% on those notes, that's big bucks! Zayo already had $682.7 million in long-term debt; now it will have about $2.9 Billion in debt on approximately $900 million in annual revenue.

I still think that taking Cogent out would be a good move for L3 or someone. You get fiber, revenue, lit buildings and take the low priced carrier out of the market. It did take almost a year for AboveNet's investors to sell, so maybe in 3Q or 4Q. Most buyers - L3, CTL, WIND - have already bought something and are still refinancing debt as well as integrating what they bought.

For the Channel, this mounting debt is scary. Why? Because the CFO looks at the line item for commissions that grows every quarter. He wonders why he has to keep paying it, The CFO thinks, "If I wipe that line item out, our books look great." That's the scary part.

Read more... [Zayo Buys AboveNet]
 
Lotus Ad for Cloud
NSP Strategist
Wednesday, 14 March 2012 18:42
Peter Radizeski is a telecommunications consultant and analyst with RAD-INFO INC. Service Providers have called on RAD-INFO INC for assistance building a channel, improving sales, managing online marketing efforts, and overall company strategy. Contact RAD-INFO INC at 813-963-5884 or http://rad-info.net

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EarthLink's Sweet Spot
On Rad's Radar
Wednesday, 14 March 2012 11:53
I learned a few things at the EarthLink training today in Tampa. EarthLink has 175K business customers and about 3 Million consumers, most of them dial-up customers, providing $20M in free cash flow per month. So of the $1.3B in annual revenue, about $500M is dial-up. ELNK has 4 data centers - Columbia, SC; Rochester, NY; Marlborough, MA; and 55 Marietta.)

The first (or 70+ slides) shows that Pipe is the foundation for Managed Security and other services. However, despite having 28,000 miles of fiber, they don't want to sell transport on it. Even On-Net gets the response that "This is not our sweet spot".

What is the Sweet Spot? As I wrote here, Multi-Location Multi-Access type across LEC's or cablecos.

The partner portal is in development. The customer portal, called myLink, seems cool they way that you can drill done on customer locations in Google Earth and open a trouble ticket.

Agents in the room, called T1 Slingers, asked about DSL, since EarthLink resells ADSL out of 10K end offices through 12 providers. As a resell service, a 1FB is required. And since neither RBOC is really supporting their copper plant and especially not DSL, it leaves the business DSL customer hanging for days when there is an outage. [See my post about Is DSL Done?] 3G/4G wireless backup is my answer for that. There are cool routers that even do it automatically.

The other question centered around T1. "You just are not going to make a living slinging T1's at $400 any more."  PRI's are available east of the Mississippi still, which actually IS an advantage for ELNK. TDM PRI's are still the preferred reliable way to deliver voice to a PBX, especially with alarms, faxes, and elevators.

It was an hour on MPLS. I still find it amazing that almost 9 years after my first MPLS class, we are still presenting the Fundamentals of MPLS. For Agents, it will be about layering on services to the MPLS network. The sticky stuff is value added services.

Retail needs a voice line, some Internet, credit card processing, payroll and data backup. That should actually be a bundle that someone offers. ELNK has the old New Edge AX platform that connects payroll and cc processing to the MPLS Network. Add on a VoIP line and some data backup and there's a bundle. Want to make it stickier? Add network DVR to the service so that those IP surveillance cameras can be viewed from anywhere (and can't be erased locally). Bingo!  (Do you have an opening in Product Management? My resume is here.)

The team mentioned POS, Inventory, HR and Loyalty programs. Do you have those on the AX platform? Those would make some excellent sticky add-ons.

"So we have an Internet T1 service that connects you securely to one of 4 data centers, Mr. Prospect. Do you currently have a payroll service? Are you looking to upgrade your POS? Are you worried about security on your credit card data (PCI compliance)?"

That's where the conversation has to go. Even though the customers just want the access - as cheap as possible - Agents will have to steer the conversation to: applications on top of that access (AOTTA).

So back to MPLS with Type II access. Ethernet is delivered over a Type II DS3 from the LEC. T1 is delivered over the ILEC copper pair. DSL is a resell of the ILEC product offering. Then for outliers to attach to the MPLS network, there is an IPSec GRE tunnel with BYOB (bring your own broadband). Blended Access.

EarthLink is a Sprint MVNO, but it is more for 3G access where there isn't DSL to attached to the MPLS. Also, for the MPLS customers that want to have one bill that included cellular.

Something else I learned: ELNK bought STS because Rolla knew the Mark Amarant, CEO of STS, and STS had a reputation for best practices in on-boarding customers in the Hosted PBX realm. That's smart, because Hosted PBX (like VDI, another product that ELNK is rolling out), requires a detailed on-boarding process from pre-sales through post-sale, including mapping extensions to desktops, extension attributes, handset type, employee training and some on-site installation. EarthLink is not selling Hosted PBX as a stand-alone. You have to buy access from ELNK.

So in summary word of the day: "Blended Access".

Key association: Multi-location multi-access MPLS.

Read more... [EarthLink's Sweet Spot]
 
CLEC Strategy 2012
NSP Strategist
Wednesday, 14 March 2012 10:39

If you are a nationwide CLEC or ITSP, your new strategy going forward is this:

The ILEC's are kicking are ass on Special Access. (See L3's FCC docket)

Cable will own all SMB services under $500.

We have fiber but we don't want to sell transport.

We want multi-location MPLS. CLEC's originally had a slight advantage with LNP, calling area, and cross-LEC services. Let me explain.

LNP: If your business was moving across the LATA or at least off the Central Office you were serviced from, you lost your number. CLEC's stepped in to let you keep that number. The same today.

Calling area: CLEC's typically gave you a larger local calling area. LATA-wide dialing was the usual deal. For small business, today, they are used to unlimited dialing through a VoIP provider (billed per handset) or on the cellphone plan. The per-minute and long distance billing is really only a medium, government and enterprise deal.

Cross-LEC services: cable companies have regions like ILEC's do. CLEC's can provide one-bill service across LEC's and across cableco regions. With the MVNO services that some CLEC's have, they are saying, hey, we can provide all that on one bill. It's not the lead offer, but it is in the tool kit.

So it is MPLS, Managed Security services and Cloud (including Hosted VoIP). And it is not BYOB Cloud either. It's so picky that they might as well throw in the towel and call it a day.

Peter Radizeski is a telecommunications consultant and analyst with RAD-INFO INC. Service Providers have called on RAD-INFO INC for assistance building a channel, improving sales, managing online marketing efforts, and overall company strategy. Contact RAD-INFO INC at 813-963-5884 or http://rad-info.net

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