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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.”

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So How is VoIP Doing?
On Rad's Radar
Thursday, 08 July 2010 01:50

According to the FCC, the VoIP subscribers is 21 million not including Skype users. These figures are part of the 31-page report, "Local Telephone Competition". The report uses data from 2008!

Of the 162 million voice lines, 21M are VoIP. Consider that cablecos probably represent almost half that number. Vonage is about 2.5M subs then. VZ's FiOS is VoIP, so that's about 1M. So the hundreds (probably thousands) of VoIP Providers amount to 8M lines? OUCH! No wonder they need more funding.

According toi the report (via The Register), only 2M lines were business. 19M were residential.

Read more... [So How is VoIP Doing?]
 
Two Mergers
On Rad's Radar
Wednesday, 07 July 2010 09:35

Two resellers merged: GLOBALINX Purchases TMC for 'Robust' Agent Channel. GLOBALINX is an IP reseller. TMC is a TDM reseller. Should be interesting to see how the Bell-heads work with the Net-heads, since the thinking is way different (and so is the approach to sales).

LightYear buys the assets of SETEL. SouthEast, a Pikeville, Ky.-based CLEC, filed for bankruptcy in September of 2009, mainly due to bills owed to the ILEC. Sources tell me that a court case over disputed UNE's resulted in a multi-million dollar back billing which forced the BK protection. The Business Journal has details of the asset purchase. According to Yahoo, SETEL had 33,000 customers and revenue of $37.5M.

CLEC's forced into BK is not that unusual. Another KY based CLEC, Win.net, also filed BK last year. The largest debtor was the ILEC. CommPartners was recently forced into bankruptcy protection due to ILEC bills. Honestly, in some cases it's the CLEC business model. In other cases I have seen, the order for a UNE goes into the system as Special Access and the CLEC gets billed a hundred times what they expected and termination liability coupled with late fees and billing penalties pushes the CLEC over. I still maintain that the billing department for an ILEC is a revenue stream. They bill in error on purpose and hardly ever fix it. In fact, account execs I know at the ILEC don't even want to spend time fixing it. So what does that tell you? Telecom is broken.

Read more... [Two Mergers]
 
The Green Zone Inside Out
On Rad's Radar
Wednesday, 07 July 2010 07:15

[Just a warning: This is a Rant, so you can skip it if you want.]

I just finished reading Barry Eisler's book, Inside Out. Eisler used to work for the CIA. Page 301: "Number 1, the country is run by corporate interests. I never understand when people get worked up about socialism. There's no socialism here/ There's corporatism."

I don't know about you, but all during the healthcare debate, my Facebook page was covered up with people crying about how America was a socialist state. It just goes to show how ignorant the average voter is. (Thanks Fox "News" for stirring up the public but not educating them at all). 

And another thing: We already have free healthcare in this country. It's called the ER. Anyone without insurance - homeless, illegal immigrant, other people who know how to game the system - know that they can use the emergency room at a public funded hospital to get treatment, drugs, and even a bed occasionally. All at taxpayer expense.

The whole healthcare debate is so that we can shift the money to Big Pharma and Insurance companies instead of Medicare, which is bankrupt, by the way.

Last I read there were about 14,000 lobbyists in DC for the 535 Congress Critters. Eisler writes that there is only about a 2% churn in Congress. That's how ignorant voters are. They don't like how things rae going, but they vote in the same critter over and over.

In the beginning, Congress was part-time. These guys had JOBS as farmers, merchants, etc. They came together in the Winter (after Harvest) for a short while to perform the necessary Federal things. Now it's a full-time well-paid machine that is out of control. How many more laws do we need? Hardly any. We don't have any new problems -- worse, we don't have any solution other than throw money at it - and I was told that if money would fix it, it wasn't a problem.

Anyway, so after reading Inside Out, I then watched Green Zone. Probably not the double dose of reality I needed. Now I get that both are fiction, but then many of you think that Fox "News" is actually news, so forgive me for thinking that there is always a good dose of reality even in fiction.  Green Zone is about the fact that our US President went to war with Iraq on fabricated intelligience that he later blamed on the CIA. Good movie. Good book. Read and see if you disagree with me. I welcome the dialogue.

Read more... [The Green Zone Inside Out]
 
How to SELLECOM SAAS
On Rad's Radar
Thursday, 01 July 2010 08:56

A 20 minute conversation with Joe Pennavaria, a Channel Manager with CoreBanc, Inc. discussing how to sell Software-as-a-Service (SAAS). (Part of my SELLECOM series).

Read more... [How to SELLECOM SAAS]
 
Zayo Buys AFS
On Rad's Radar
Thursday, 01 July 2010 04:41

As Rob Powell predicted, the self-proclaimed Fiber Bigot, Dave Rusin, CEO of Rochester-based American Fiber Systems, sold the company to Zayo. Some reports were that the sale price was $185M, but Zayo is stating that number is ridiculous. The original press release did not offer a price tag. 

Consider that Zayo financed $250M in debt at 10.25% in April. It's AGL acuisition is still pending. Zayo has a capital intensive business (building out fiber always is). And it's a VC backed company. Zayo smacks of a roll-up waiting for the right time to resell. I don't know when that right time will be because it looks like either Zayo is the sole bidder for these networks (AGL, AFS, etc.) or that they are the most aggressive bidder. Who then would be the buyer? Everyone I speak to that evens knows who Zayo is thinks it's just a roll-up.

Here's why I think that it has some issues as a long-term business:

Zayo's voice division was discontinued in March 2010. (See 3Q2010 earnings report). A little young to already give up on voice, but maybe it's outside its skill set. Makes me think that Z-Colo division will be closed in a year too.

The network is dissparate. Unconnected by its own fiber. And from my experience (and anecdotes from others) Zayo isn't sure where its assets are and takes a long time to deliver a quote. It's like dealing with KDL for heaven's sake.  I know they are salesforce.com powered but maybe they need a better database for network assets and quick quotes.

Like the AFS customer base, it is weighted towards the carrier, wireless and other wholesale segments. Wholesale telecom is not as profitable as retail. 

Zayo as a group does about $59M in revenue per quarter which is about $240M per year from $400M in invested capital. At 10% growth, how do you even pay back the note?

I get telecom math and accounting are fuzzy - ask MCI, Enron, Qwest. etc. But I don't see who can buy them or how they make it long-term. I ask why AGL, KDL, AFS, and other regional fiber companies are for sale. If fiber is king, why sell now? Makes no sense to me.

About American Fiber Systems:  Based in Rochester, New York, privately-held American Fiber Systems (www.afsnetworks.com) provides dark fiber and lit bandwidth services to carrier and large enterprise customers. Since its founding in 1999 by former Frontier Communications President, David Rusin, AFS has expanded to include 1,200+ route miles of metropolitan fiber networks across nine markets and regionally throughout the State of Georgia with 600 lit buildings.

Read more... [Zayo Buys AFS]
 
Is 4G a Game Changer?
On Rad's Radar
Thursday, 01 July 2010 03:45

Lots of buzz around 4G - and Sprint and Clearwire certainly need that buzz to reach tweet level. But is it a game changer

Just my opinion but 3G is ho-hum. I haven't noticed that much speed off by EVDO card or Blackberry. In some places and times, it's quick, but in SO many times and places it is dial-up slow.

I understand the buzz: these companies need to make it seem special so that they can charge more -- to pay for network upgrades and backhaul costs. We are paying for their poor planning.

Think about it: 2.5G, 3G, 4G/LTE/WiMax. That's a lot of upgrading, but the backhaul has been slow and done on the cheap - at the expense of the customer in terms of service delivery. Also, if they had just bit the bullet to have fiber to towers, they would be ahead of the game now, instead of playing catch up.

For the Channel, I don't see how 4G will be that big of a deal. For the POTS/DSL sector, it gives them something else to pedal that resembles TDM. But AT&T doesn't let agents sell iPhones - and why else are people getting on that network? Online sites can sell cellular plans much cheaper than agents can. Even give rebates to the point that the buyer gets money back. Agents don't have that luxury. Agents also don't usually have access to latest devices, handsets or plans. So game changer? Not really.

There are agents that use 4G for M2M or broadband back-up that will be able to make some coin with solution selling it, but I don't think offering 4G like you do Dynamic T1's will be a biz plan that works. I could be wrong, but when the brick-and-mortar corporate stores have to make quota, agents won't be able to compete. And again online stores will win too.

Read more... [Is 4G a Game Changer?]
 
What Makes a Good Master Agent?
On Rad's Radar
Tuesday, 29 June 2010 10:10

The Technology Channel Association (TCA) hosted a conference call today about What Makes a Good Master Agent.

The main factor is of course money. Commissions. Collecting them. Mediating commission disputes. Evergreen contracts. Paying them in a timely manner.

What about the financial stability of the master agency? how can an agent tell if the master agency is financially sound? Bill Leutzinger of Telecommedic says to ask the carrier and ask the master agency to show them revenue run rates. Geoff Shepstone of TBI mentioned looking at the timing of commission payments and whether or not the agency is growing (i.e., hiring employees). Apparently, Microcorp's Commission Insurance is a new twist, but details would be needed to see if that would be enough assurance for an agent.

The Diversity of carriers that a master represents is not as important as the expertise that they have with the carrier. Especially with the carrier the agent is most interested in.

That expertise alone is not enough. This is a Relationship business. As Van Wender of Microcorp commented, "People do business with people they like and trust." (A Gitomer-ism). It certainly has come down to relationship for me with the master agencies I have done business with.

Tools are still new. Not used as much, especially if, as Leutzinger states, the tools are delivering the best available price. He doesn't want to be embarrassed if he delivers a quote that is higher than another agent. (Bill, this happens to me all the time because each carrier has indirect, direct, and wholesale channels).

Jeffrey Potts of Datatel says that the VARs he works with want the back-office support and the repair escalation assistance. They will even take less commission for that peace of mind.

I would have liked to hear from more agenst and less master agents but apparently agents are out scrambling for business and can't get on the call.

Next month's call is Friday, July 23 @ 1 PM ET: Agent 101: Choosing Suppliers, Presented by Dan Vidal, Telecom Advisors. More info here.

Read more... [What Makes a Good Master Agent?]
 
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