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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

Progress is Being Made
NSP Strategist
Sunday, 15 August 2010 05:48
"As a general rule, whenever you hear special-interest groups using near-hysterical language to warn that some proposal will destroy jobs, snuff out innovation and end free-market capitalism as we know it, you can generally assume that progress is being made." from the Benton Foundation.Seth Godin had something similar to say this morning: "I've talked to brand stewards from JetBlue and Starbucks

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Quiet Last Week
NSP Strategist
Sunday, 15 August 2010 05:40
Sorry about the lack of posts last week. I had to go to Connecticut to look-in on some family problems. I will likely be quiet this week as well, since I will be training an ILEC-CLEC in KY all week. But I will be back to posting like crazy after that :)

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An Interview With Level3
On Rad's Radar
Wednesday, 11 August 2010 11:41

As a founding member of the Technology Channel Association, I get to interface with some of the channel execs. One that I have a lot of respect for is Craig Schlagbaum, VP Indirect Channels, Level 3. Craig let me interview him about changes in the channel.

1. What is one change that you have noticed in the Channel thus far in 2010?

As the concept of cloud-computing continues to emerge as a viable next-generation solution for businesses, the line between the high tech and telecom service worlds has blurred. VARs and solution providers from the traditional high tech industry are transforming their approach towards serving their customers, shifting away from a "one-time sale" model to become much more solution-oriented in nature with recurring services that are on-demand. In addition, many of the solutions these partners are beginning to offer such as SIP, SaaS, and managed services require carrier services to enable them.

In fact, many of our larger producing partners in 2010 have come from the traditional high tech world and have successfully made the pivot to selling carrier services in conjunction with the value-add components that they're piling on.

2. The Channel Partners are experiencing the shift from TDM to all-IP. Level 3 certainly spends time on training and explaining. Do you think that the Channel learns better peer-to-peer?

As we continue to see the transition from TDM to IP-based products, effective training is critical due to the complexity of the product sets. At Level 3 we offer a wide variety of training opportunities for our indirect channel partners. We understand that everyone learns differently, so we've tried to implement a number of vehicles for our business partners to learn not only our Level 3 service portfolio, but also the technologies associated with these services as a whole.

Our online training platform, which can be accessed through our Business Partner Portal, has become a popular training medium as it is a self-paced tool that allows partners to undergo trainings at their own speed. As this training portal continues to evolve, we will be requiring certain levels of certifications moving into 2011. In addition to our online training platform, we offer monthly service trainings via webcast and face-to-face trainings with our Partner Sales Managers and SEs.

There is no substitution for learning with peers, but in order to scale more effectively, it is crucial that we put the necessary tools and systems in place to allow our partners to become as self-sufficient as possible.

3. How do you foresee TCA's certification program affecting (if at all) the Channel?

Even though the transition from the IT space to the carrier world creates a significant opportunity for the indirect channel holistically, not all partners from the high tech industry can successfully make the pivot. Training and certifications will be an essential ingredient for success and will become more meaningful within the carrier services world as more IT channel partners make the switch.

I think that implementing a TCA standard industry certification positively influences channel partners that are already involved in the carrier services space, raising the bar and allowing committed partners to demonstrate their skills to their customers.

Read more... [An Interview With Level3]
 
Broadsoft's First Public Quarter
On Rad's Radar
Tuesday, 10 August 2010 12:25

So Monday morning I was on the very short investor call for Broadsoft's first quarter being public since it's IPO. Marketwatch has the 2Q2010 results here.

  • "Total revenue was $19.8 million in the second quarter of 2010, compared to $17.7 million in the second quarter of 2009"
  • Net loss for the second quarter of 2010 was $1.8 million
  • Net loss for the first six months of 2010 was $4.4 million

"During the second quarter, our license revenue increased 20%, to $10.6 million, compared to the first quarter of this year, reflecting service providers' demand, as they transition from TDM to IP-based communications, for our flagship product, BroadWorks, which enables carriers to deliver feature-rich IP-based communications services to their enterprise and consumer customers."

More than 50% of revenue is coming from licenses. Mainly VZ FiOS, Comcast, XO and Brazilian MSO, it seemed like from the call.

The key is selling licenses. Many more licenses, since 400+ service providers already own the softswitch. How many more prospective softswitch buyers are out there? Broadsoft clients have to start selling Hosted PBX in droves. Two hurdles:

  1. In our TDM-based world, most sales people can't sell IP Communications.
  2. ISP's are blocking port traffic which disrupts the voice applications of Hosted VoIP Providers.
The timing seems right. Maybe we'll hear some promising messages at ITEXPO in LA on Oct. 4-6, 2010.

Read more... [Broadsoft's First Public Quarter]
 
Do You Compete With Your Channel Manager?
On Rad's Radar
Tuesday, 10 August 2010 12:09

Lately, I have been seeing some crazy things out of Channel Managers. Do they not understand that everything comes out since we operate in a small world?

I have seen this twice this month, where someone is a channel manager for a VoIP Provider and also runs a VoIP Provider. You read that correctly. On LinkedIn. Two different people who run a VoIP business (BigTown Business VoIP) that competes with the day job of running a Channel for another VoIP Business (CHI-Town Biz VoIP).

My best guess is that the BigTown is a reseller of CHI-Town for deals that CHI-Town doesn't want. Which leads me to wonder about leads that go into the CHI-Town's channel. Just plain conflict of interest.

And this is why people think telecom is sleazy! Because there is way too much of this crap!

How about a Channel Manager who gives leads to his favorite agents that come from his non-favorite agents? Nice huh?

Read more... [Do You Compete With Your Channel Manager?]
 
Mergers Only Mask the Truth
On Rad's Radar
Tuesday, 10 August 2010 10:14

I have a firm belief that most mergers are just ways to make the books look better by clouding the numbers. Take this headline from the Morning Journal, "CenturyLink has profitable second quarter, primarily due to acquisition". I agree with that.

The telling number is the revenue or income or EBITA, but this metric: "CenturyLink added more than 29,000 high-speed Internet customers in the second quarter, compared to 28,000 in the second quarter of 2009, the company reported." HUH? You added the same number of broadband even though your revenue was up 3x what it was before you merged with EMBARQ?

Windstream added 14,800 new high-speed Internet customers during the second quarter - about 58% resi penetration. ... Total access lines declined by approximately 34,000. [Windstream]

"Qwest saw a decline in its earnings as revenue continued to fall on further landline losses," according to the WSJ. "As with the other telcos, the DSL business continues to be weak. ... Qwest only added 7,000."

Debt is going up (and getting more expensive) while access lines are declining. Long term this doesn't look good. Qwest has been working on an FTTX plan, but it will be a while to pull off (and require more CAPEX than they are now spending).

ctel-wind-2q.jpg

Most mergers are about scale. The bigger they are the cheaper they can deliver service. How often has that reality been true? Bigger means that there will be massive layoffs to the point that the new company can't find anything or accomplish anything, because all the people with deep domain knowledge (the Linchpins) are gone. Then there is the back office, which usually can't be integrated for months or even years. The political silos and departmental turf mean that no one can work together and there are competing pieces of the company working against each other. It's a nightmare that only the bankers win. Shareholders may make a little bank upfront, but long term value is not on the increase. Teclos play in flat markets: phone, broadband, TV - these aren't growing pools; they are shifting pools. Shifting as customers bounce from cable to telco and back. Shifting as people move around the nation looking for a better job or just A job or a better life. So long term growth opportunities are looking good because they don't innovate and the hardware vendors aren't making enough profits to innovate either.

Sounds bleak but it leaves plenty of room for forward thinking, flexible companies that have a value porposition for a selective target market - and can move on it now!

Read more... [Mergers Only Mask the Truth]
 
Hosted Exchange Adds VoIP
NSP Strategist
Tuesday, 10 August 2010 08:38
Intermedia has been an ISPCON mainstay back in the day. GroupSpark and Intermedia introduced white label hosted email to the industry - or at least rang that bell for many years."Microsoft Exchange hosting provider Intermedia today announced the launch of a new hosted PBX VoIP service which integrates with Intermedia's hosted Exchange e-mail service enabling customers to access both unlimited

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