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ITEXPO: The UC Outlook

The future of UC is bright says a number of executives at UCaaS providers. But is it?

I spoke with a few VoIP executives including CoreDial at ITEXPO. There are two separate layers: cheap voice or POTS replacement and people who want a comms platform.

Most aren’t using the full suite since they have Slack, Messenger, WhatsApp, etc. They have Office365 or Google for Work. It is a siloed approach to a comms suite.

Price points are decreasing. But then they had to since UCaaS is costing more than a SIP trunk and a small business PBX (think 3CX, FreePBX, Asterisk).

There aren’t that many multi-location businesses. (And everyone is chasing them!)

There are more businesses with remote workers. There are also more workers with consultants, contractors and freelancers who are outside the federation of the enterprise system. How do they fit into the organizations’ communications?

Coredial turns all features on when they sell off the Broadsoft platform. This way users know about features that they may not have been aware of, like voicemail to email or text to email.

There is training for users – and later due to employee turnover, more training for users. This is but one way to ensure that the customer’s organization is getting the full benefit of UCaaS. Otherwise they could have bought the cheaper version!

Everyone is talking about softphones (especially Broadsoft and Counterpath!) Yet there were many new phone/handset vendors at the show. [There also were a couple of VoIP endpoint vendors who had devices very similar to Doorbot! ]

Are you using a softphone on your laptop/desktop/tablet? I’d be curious who is – other than folks who actually work at the VoIP provider!

8×8 is pivoting to Global! I guess they think they have taken all the share they can in the US. Or it is getting too expensive to acquire a customer in the US!

Maybe I am jaded because I have been staring at the VoIP World since 2002.I have waiting for the tidal wave of adoption but small business after small business are pretty happy with a key system, which despite the argument to the contrary is not the value of a Hosted VoIP solution (to see Key System Emulation is UGH!!!!)

I saw quite a few new logos that offer VoIP/UC. Consolidation news has quieted down. Current UC providers have to get – not only better at selling seats – but more efficient at selling them. Velocity has to happen. Yet to have that happen, the provider has to take more friction out of the sales process. The provider has to narrow its focus on who it can best serve and why – and target better for faster conversion.

During my discussion with Coredial. we talked about the market – actually we talked about the fact that the market of 1-500 employees is more like 7 markets with 7 different buying personas. UC is still triggered by an event more often than not, says Coredial. Moving, expanding, shrinking, acquiring — these business events for the organization warrant a look at shifting from premise to Cloud Comm.

The market segments need to be addressed. The messaging, the targeting, etc. Considering many service providers barely have marketing in place for one persona, how will they market to 5 or 7 segments while addressing even half that many buyer personas?

I often talk verticals, but I also know that channel partners HAVE segmented the providers. “We use this one for 1-5 seats and this one for up to 20, etc.”

It is unlikely that a partner will use the same provider for 10 seats as for 150 seats. It would be a white whale.

Just some food for thought.

One more thought: with Net Neutrality going away fast, what do OTT VoIP players do?

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    Copyright On Rad’s Radar?

    The Cost of Competition

    As the new FCC enters a pro-Big Boy era (again), competition will not be a word we will hear often. Consolidation is making it hard to find more than one carrier in a building. – or a territory.

    The Age of the CLEC – the competitive carrier – is at end. They fill gaps now, like Birch, Bullseye and Granite for POTS and other legacy services. XO is part of Verizon. EarthLink absorbed by Windstream to become like AllWorx, USLEC and Paetec, a memory. Level3 will be a division of CenturyLink, where it will cease to be a rival to the RBOC in the Enterprise.

    Net Neutrality is going away. That zero rating investigation to determine if giving some content a free rideover all other content was fair has been closed.

    It is simply cable or ILEC. And both groups have to be wondering how much longer they can continue to carry their massive debt. The big dilemma is that ARPU is stagnant but subscriber counts have peaked. Cord cutting is a real issue for cable, telco, satellite and content owners. NBCU closed two channels recently and re-branded another. Apparently, twenty five cents per subscriber per channel per month isn’t enough any longer. And advertising rates are a little off too. The economics of many legacy businesses are being blown up!

    The cost of services increases as more small cells are deployed to blanket coverage for 4G LTE, LTE-Advanced and how much will 5G cost? If ARPU is stagnant for cellcos in this price war, yet the cost to build and maintain the network remains constant and you don’t lose any subscribers, all is good.

    Sprint and T-Mobile have waged a brand battle against Verizon and AT&T. It has worked to a degree. But all 4 carriers are losers. The foreign owned T-Mobile and Sprint can afford to lose money for a while, but how long?

    With the subsidized phones are gone so are contracts and large ETFs. More churn. Higher cost of customer acquisition. Ma and Pa Bell already saw this small business broadband and voice. Then they lost the consumer broadband and voice market. Now the cellular market is up for grabs.

    Verizon is looking at buying Charter now. Rumor has Comcast looking at buying its 4G backup partner, T-Mobile. The cablecos denied cord cutting until it was too late. Telcos denied cable competition until it was too late. There really aren’t any visionary CEOs in our space.

    The problem remains the same: at some point you have to be make money, not just on paper.

    Debt payments, network CAPEX, stock dividends, payroll and pension liabilities are a burden to ILECs – all of them: Frontier, AT&T, Verizon, CenturyLink, even Windstream and Fairpoint (who sold out to Consolidated).

    Revenue is getting crushed as the cost of bandwidth, transport and transit collapse. Voice revenue has declined. Text revenue is flat. OTT apps have taken video calls (Skype, Facetime), some voice calling (Messenger, WhatsApp), SMS/MMS. What’s left? The Enterprise market and the Government market.

    What happens when there are just 4 carriers? Is the channel necessary to sell monopoly services? Well, see.

    Some other points:

    With subsidized phones gone, how will that affect phone makers long term? Will we see the leaps in tech that we have so far? Unlikely. Google Pixel at $649. The iPhone 7 is $700. Not that many folks are going to drop that cash every 18 months to two years. (Note to self: Get in the smartphone/device insurance business!)

    When will the next highly desired device come along to prompt an exclusive carrier deal (a la AT&T and the original iPhone) to drive signups?

    Even Sprint is Buying into the business of streaming media with a $200M investment into Tidal, another money losing music streaming service.

    As someone at lunch pointed out, many foreign LECs like Vodafone, BT, Telstra, even NTT, are sitting on tens of billions in cash. They could buy into the US market.

    We sit at the nexus point of some interesting times.

    Did you notice that UCaaS consolidation halted? Yeah, me too.

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    Copyright On Rad’s Radar?

    Some Mergers Have Closed

    Verizon closed on XO. XO is now XO, a Verizon Company. It will be business as usual for XO for a little while. Yet Verizon did re-org, according to CRN. “Telecom giant Verizon has revealed a newly restructured business unit geared toward reaching more small and medium-sized businesses (SMBs), Verizon Business Markets. Verizon Business Markets (VBM) was formally known as Verizon Small Business, according to the business unit’s new LinkedIn page. Janet Schijns, vice president of global channels for Verizon Enterprise Solutions, is now leading the new unit as chief channel executive and vice president for VBM.”

    TPG Capital finished up its acquisitions of RCN and Grande from ABRY for $1.6B and $650M, respectively. TPG is combining the two companies into what will be the 7th largest US cable company and plans to expand and enhance operations across the combined footprints.” It will still be the 7th when VZ buys Charter.

    “Strome Fiber Holdings, LLC announced today that it has acquired all of the network and colocation assets of AF-Southeast, LLC. The acquired network and colocation assets consist of a contiguous dark fiber network, constructed along secure private right-of-ways, that extends from Atlanta, Georgia to Miami, Florida including interconnection to key data centers in both markets and strategic access points in between.” [source]

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

    Google, WebRTC and UC

    Interesting look at Google’s deal with RingCentral. It involves WebRTC to power voice and video calls through the Google for Work productivity suite.

    Dialpad is Craig Walker’s latest venture. It was formerly known as Switch.co before Walker bought the rights to the name and domain for dialpad back from Yahoo. He was an investor in Dialpad which sold to Yahoo in 2005. Walker was also the co-founder of Grand Central that Google acquired in 2007. It became Google Voice in 2009. Now Google is trying to revive Google Voice – and Walker is trying to revive Dialpad.

    I actually didn’t know about Jotspot or Springboard or Google Sites (slide 8). Interesting concept that they should market better.

    BTW, Google Voice now has a separate mobile app from Hangouts. See more here.

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

    Hype Jacking

    TeleComp reports, “A Maine based WISP, Redzone Wireless, is seizing on the marketing hype generated by the move to 5G, launching a fixed broadband wireless service and calling it 5Gx. The service uses a proprietary method for aggregating licensed 4G LTE spectrum and unlicensed 5.8 GHz spectrum on a single tower to improve broadband speeds and performance.” Brilliant move actually to hijack the hype and the acronym.

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