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We Don’t Sell Iced Tea

I like this ad about the Lemonade Stand, because it is the opposite of what most entrepreneurs do.

Most founders would run in the house and try to make iced tea to sell to the people who ask for it. That is not a good strategy. Be like the kids: Sell your lemonade! Say No to the iced tea.

When you have enough bandwidth, add a new product (the iced tea). But give an honest effort to selling the lemonade before adding a new product or tweaking your lemonade into Arnold Palmers.

____ 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

November 7, 2016 , NSP Strategist

As the Telecom World Spins

It is happening so fast. Here’s this week in M&A:

FPL Fibernet got bought by Crown Castle
Still have the Verizon-XO merger comingtoo.
Rumor that Windstream is looking to buy Earthlink
Onvoy is getting Inteliquent
Broadsoft took VoIP Logic off the table
CenturyLink is buying Level3.
AT&T is trying to buy TimeWarner
Broadcom to Buy Brocade Communications for $5.5 Billion
Frontier had a better couple of quarters after buying Verizon franchises in FL, TX and Cali; hence, laying off one thousand amid a RE-ORG. Because that will fix the books but little else.

CenturyLink just sold off its data center business that was a combo of Qwest Cyber Centers and SAVVIS to a group of PE firms for $2.15B in cash and C-Link keeps a minority stake worth $150M in the new company. CL bought Savvis for $2.5B in 2011. Buy High; Sell Low. Bell-Head Mentality.

The PE coalition that bought the data centers also grabbed 4 cyber-security firms in order to announce this global security co, to be run by Manny Medina, former CEO of Terremark Worldwide.

Wired’s headline says it best: The World’s Telecoms Are Under Threat From All Sides.

Broadband, cellular and voice are all flat or declining markets.

IAAS and PAAS are ruled by Amazon, IBM and Google. Microsoft only got into the game recently and is doing better than all the telco’s combined.

PE firms are buying up data centers as the world adjust to cloud computing, an app market and streaming TV and radio.

DDoS attacks are happening too often. So are Hacks. There are not enough fingers to fill all the holes in this dyke.

UCaaS is ruled by 8×8, Vonage Business, RingCentral, Fuze and a bunch of other providers that are not a telco. The PBX market may be shrinking but not fast enough for the other Hosted VoIP players. Cisco and Microsoft have chunks of the enterprise UCaaS business that the telcos don’t.

Comcast Business is at $6B in annual revenue, which makes it a bigger CLEC than almost all that are left. WIND does $5B. EarthLink less than $1B. Birch and TelePacific are private. Level3 does $8B. CenturyLink does $17B (much of it ILEC revenue). Zayo is $2B.

Apps like Messenger, WhatsApp, Skype and Slack are replacing voice and SMS and even email. It is a topsy-turvy world. What’s a telco to do? Well, merge! Get bigger because bigger solves nothing, but it makes money for top execs in the C-Suite and the Board room and on Wall Street.

Our economy spins on e-commerce and the Internet. When the companies that provide that Internet are too clunky to do it properly, what happens to our economy?

We went from a five nines voice network of reliability to cell phones and VoIP that quite frankly can’t be more than three nines. Have you noticed the number of outages lately by telcos and cablecos?

There is a lot going on. There are many areas of opportunity, but the fall back from these guys is “more of the same”, “do what I know” and “one more quarter!”. None of these transactions is good for the industry, the economy or the consumers. They are stop gap, short term money movers. We are going to wake up shortly and realize that it is 1970 all over again. It makes the NSA job easier when there are few players, but what about the customers?

In the data center space, one master agency contacted me after the C-Link announcement to tell me that the folks at CenturyLink have no details about the sale. How can that be when Monroe has been trying to sell the DC division all year? Great planning, guys!

Whose customer is it? Will the agent still get paid? Will the customer see a price increase? Who is the billing entity? Who will the customer be paying? These are good questions that bothered some TELX customers when Digital Realty took over.

I keep seeing executives at master agencies say these deals are good. Do they say that in print because they have to?

Don’t forget that you can leave a public comment with the FCC on any of these mergers. You can voice your opinion here. You will need a docket number but you can google it after the filings are in the system.

Tags: att, centurylink, data center, earthlink, FCC, internet, level3, mergers, security, strategy, uptime, windstream
Related tags: business, centurylink, voice, world, centers, makes

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November 4, 2016 , On Rad's Radar

Do They Have the Skills to Sell?

Only 13% of customers believe a salesperson can undertsand their needss.
55% of the people making their living in sales don’t have the right skills to be successful.
Sales has changed in the last 5 years in almost every way. The funnel has flipped.

Most salespeople don’t have a script. They don’t take notes. They wing it. How is that working for your company?

Most people do not listen actively; they listen to respond. In sales, that is puking on your prospect.

Many people in sales and marketing think talking about their company and products (and awards) is necessary. So is a business card and brochure – because those items have closed business!

Understanding what selling/sales is like today is a big step for management to improve sales efforts. (The other step is recruiting successfully and coaching their salespeople.) Sales has been turned upside down due to the Internet.

How long does it take for a salesperson to be successful? Stats say 10 months!

Join me for a session on sales and management to develop a solid foundation for sales in your company.

The one hour long presentation will be on November 8th 2016 at Noon Eastern.

November 4, 2016 , NSP Strategist

So Much Going On

There is so much activity going on, I can’t keep up.
IN M&A:

FPL got bought by Crown Castle
Rumor that Windstream is looking to buy Earthlink
CenturyLink is buying Level3.
CenturyLink just sold off its data center business that was a combo of Qwest Cyber Centers and SAVVIS to a group of PE firms for $2.15B in cash and C-Link keeps a minority stake worth $150M in the new company. CL bought Savvis for $2.5B in 2011.

In FCC news:
FCC set a new privacy policy for user data. ISPs have one year to adopt the new rules.

IN OTHER:
Interesting factoids:

Windstream’s market capitalization is about $653 million.
EarthLink is about $572 million.
Windstream had $4.76 billion in long-term debt.
Earthlink had $466 Million in debt.
Windstream spun a lot of network assets off to CS&L and sold the data center biz to Tierpoint.
Windstream has a bit over $5B in annual revenues; EarthLink just dropped below $1B.

Fiber vs Wireless

FTTH is expensive and many companies are looking at Licensed fixed wireless as well as 5G to solve these problems. (See HERE and Mobile eating world).

MVNO

Meanwhile Comcast and Charter (Charter owns Bright House and TWC now and is branded as Spectrum) are getting into the MVNO business. They will both rely heavily on their wi-fi network and the back-up will be VZW. VZW bought spectrum from SpectrumCo that was co-owned by the 4 MSOs mentioned here. That deal gave the MSOs the option for a good rate at MVNO, which they are now taking. The Timing is kind of awful. MVNOs are opening and closing as the price war between the Big 4 doesn’t leave much room for anyone else. (MVNO means that they are a cellular reseller.)

November 4, 2016 , NSP Strategist

Another Acquisition in VoIP

This M&A is in what I consider wholesale as the private equity firm that owns Onvoy, GTCR, is acquiring Inteliquent for about $800M, a 37% premium to Inteliquent’s closing stock price. Interesting, $90M in revenue for $800M.

Inteliquent was formerly known as Neutral Tandem, with an initial business plan to be an alternative tandem switching platform for CLECs and VoIP Providers. They re-branded after they bought Tinet adding network to their strong voice service. They sold Tinet to GTT in 2013 for about $55M. Inteliquent has been focused on voice and competing pretty well against both Level3 and Bandwidth.

“As the nation’s highest quality provider of voice and messaging interconnection services, Inteliquent is used by nearly all national and regional wireless carriers, cable companies, and CLECs in the markets it serves, and its network carries approximately 21 billion minutes of traffic per month.” They added some CPaaS capability as well. I have to wonder 21B in minutes and just $90M in annual revenue?

Zayo spun out its voice business as Onvoy. It was acquired by GTCR. Onvoy has acquired ANPI, Broadvox and Layered. Now it will combine Inteliquent into that mix.

These deals have made partners and customers nervous. The uncertainty seems to be a normal now.

These integrations are smooth and often have some customer facing problems. (See Frontier for how that works.) There is so much M&A that as a partner it is difficult to choose who to present to your client as a vendor.

Tags: inter-carrier compensation, mergers, voip, wireline
Related tags: onvoy acquired, inteliquent, voice, onvoy

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