When they have the TSD talking heads on keynotes, it would be nice to have a deep dive into their cliche responses.

“”I think what we’re seeing is … there are more opportunities for advisors, and ultimately, that’s what creates a better market for customers,” Edwards said.”  [source] Word salad. How would he know what my customer wants or thinks?

The channel is historically centered on SMB. It was designed that way by the Big Channel Vendors who wanted the big clients for themselves. Avaya is kind of highlighting that now, but back when there was a BellSouth, there were many protected accounts. But also the funding for the channel came from the Small Business division, so they didn’t get credit for selling to Government, Enterprise, etc.

Microsoft, Cisco, IBM, AT&T, Verizon – have all had protected accounts.

The whole idea of channel conflict is a partner chasing an account that is in Siebel.

Also, most channel orders are transactional with shorter sales cycles.

When AppDirect buys 3 companies that only offer services to large companies, I realize that (A) they don’t understand the channel any better today than in 2020 when they acquired MicroCorp; and (B) they don’t examine their own data to realize that 85-90% of the customers are SMB.

There are maybe 60 agencies servicing Enterprise accounts. Heck, even in the MSP segment only 15% service mid-market and above! It’s about 400 MSPs that service large business.

To sell to a large business requires (A) great follow up; (B) Long sales cycles; (C) selling to multiple decision makers; and (D) great discovery questions.

Most salespeople do not have great follow up skills. They do not get motivated by a long sales cycle. The lady that sells Bombardier CRJ700 jets is not going to be able to sell DIA. Different skill sets. Different motivations.

If a TSD could in fact look at their data, they would see that at least 80% of sales are still network and simple voice (SIP trunks, POTS replacement, cell phones, digital voice).

These are packaged products familiar to the Buyer. AI, IoT, IIoT, cyber-security are not packaged products. They also are NOT replacement services nor are they bundles that could carry a SKU. That means that at least 80% of the salespeople in the industry struggle with a sale.

AI companies have been hammering me for six months about getting in the channel. But they can’t tell me who the Buyer is; what the product is; what the outcome is.

Most people in telecom probably don’t know the stories about all the booms and busts — maybe they should read Caruso’s book. Putting fiber in the ground sounds an awful lot like AI and CyberSec. Lots of opportunity, lots of investor dollars, but very little actual sales revenue.

You would think after Katrina it would have been easy to sell Disaster Recovery services like backup. No. Most businesses thought it was a once in a lifetime act and since they survived, no worries. Yet many SMBs closed because they only had paper files that were lost to flooding and had no business data to go back to. But it was still hard to sell DR in NOLA!

I also think that some TSDs only talk to their top 20 partners and consider that “the market”.

I have been thinking about this quote from Intelisys’ Ken Mills:

“And I think that is really important to have the advisor play a more strategic role their customers, bring more services their customers, and leverage organizations to help them deliver [the right solutions]. … We want to bring different value propositions to customers and have our advisors start to play bigger roles in those opportunities.”

Some customers have a PBX guy, an MSP, a network guy, etc. They aren’t going to shut out one “guy” over another.

“We’re just going to continue to sell new things,” said Bridgepointe’s Evars. “There’s a huge opportunity there.”

There is a huge opportunity to sell new things, but by a tired audience of sellers who are on a treadmill, running as fast as they can to sell stuff to maintain commissions as each renewal results in less commission. They want to sell new stuff IF it is packaged to sell fast and pay fast. Is it? No.

Well, actually Net2Phone’s new AI assistant is.

The TSD answer is to sell more to each customer. That means spend more cycles with each customer to get more wallet share.

This goes against the lesson of UCaaS. One reason UCaaS isn’t every partner’s first choice to sell is because it has a longer sales cycle than just replacing dial-tone or the PBX. Also, the compensation (without SPIFFs) is not worth the sales cycle, the service delivery or the headache after.

And once again, partners don’t create demand; we supply it. There is still demand for key systems, side cars, and paging systems. Not every business – especially small business – has a desire to consume technology. They don’t have a technology team. They don’t want to slow down production while the staff learns (and fights) new tech. That’s reality even if it doesn’t fit in with the industry singing OPPORTUNITY! That’s what Frontier, Fusion, GTT, Airspan, Cyxtera, Starry, Windstream, Sungard, Covad, Focal Communications, McLeod, Northpoint, Winstar, AboveNet, MCI, 360networks and so many more said before they filed for BK.

There was a cable company that hired me to train the sales reps on selling Hosted PBX/UCaaS. The sales leader asked why sales were still slow. I asked if the comp plan had changed. No it hadn’t. So there was no penalty for not selling UCaaS. So the sales team sold what was easy.

I have managed sales teams for ISPs and MSPs and every time there isn’t a mandate to sell HPBX, the sales reps ignore it. Get quota fast and furious selling network and voice replacement.

Everyone confuses the Partner as a business genius, but in so many cases, they are just sales people who now work for themselves – not entrepreneurs. they are solopreneurs or freelancers. You know how I know they aren’t business people? The number of partners who did business with TNCI and the number that sold to private equity. We get to hear those horror stories every month on our partner call.

There are sound business people in this channel, no doubt. There are partners selling to Enterprise – Scott Levy, Dyson, ACT, Acuity – but these are not the majority. They are a niche. It takes a different set of skills to land and handle an Enterprise account. [BTW, if it was easy to land Enterprise accounts, don’t you think the vendors would do it without the channel?!]

Went to Enterprise Connect yesterday. Had some meetings and walked the show floor. Two terms showed up at most booths: CX and AI. Not a surprise, but really boring. The same thing over and over.

At one meeting I was asked about the future of cloud comms. I don’t think the 5% CAGR puts it in growth mode. As I have said previously, Enterprise Communications is for 44K companies, which does not represent most of the addressable market. The addressable market is SMB, which represents 99% of your customers.

The major problem for most cloud comm providers is that they want to sell to Enterprise and Big Business without the ability to actually do that. They won’t hire a sales and marketing team. They won’t put in the work. Partners can’t do that work for you. They supply demand; not create it.

RingCentral spent years and a couple of billion dollars going after to mid-size and large accounts. SDR, sales teams and tools, every aspect of marketing, R&D, user design, and M&A. It made deals with Mitel and Avaya to get into large accounts. It partnered with VZ, AT&T, Spectrum and other telcos for more opportunities, but had to suffer through the piles of smaller deals that came with it.

And even with all that Microsoft Teams and Zoom have taken all the oxygen out of the UC&C room. The CCaaS space is hyper-competitive with most of those providers also chasing Enterprise because who else has call centers with at least 200 agents?

What has your company done to win enterprise?

I sat through a TSD’s partner workshop last week where they paraded vendors that only sell to enterprise in front of us. And the whole time, I am thinking: “What a waste of our time and theirs.”  Historically, the channel handles the SMB space. There are partners who sell to Enterprise, but that is a small subset of partners.

The SMB market is 33M businesses in the US with less than 500 employees. 15.7M have between 1-49 employees.

SMB is most of the accounts. Most partners (85%+) sell to SMB. SMB does not buy like enterprise nor do they have the organization or staff of enterprise. Small business lacks the technical skill and the staff to run a POC (proof of concept trial); play with SDKs; try to get integrations to work. They need reliable solutions that are turn-key with a specific ROI.

If you notice lately, some Enterprise vendors want to move down market. They have been fighting for 44K largest accounts and they are tired and bloody. It is very hard to displace Microsoft, Cisco, IBM, and Google.

Let’s talk AI for a minute.

AI for the most part (at this time) is a cost savings and productivity tool for large business. Does it save so much productivity that each employee should pay $30 per month for it? Probably not. Does it save a call center agent or two? Probably.

Chatbots, assistants, AI agents – they don’t work in a vacuum. They require data. Where are they going to get that data?

Freshworks surveyed 600 businesses in 2024 and found 71% of small businesses use CRM. I think that is high, but also begs the question: What CRM? There are over 800 CRM platforms out there. Stripe and Quickbooks could be the CRM. Really hard to extract data from either of those platforms for your GenAI chatbot. MSPs use ConnectWise for CRM, billing and ticketing. Really hard to extract data from that platform as well. So where does a small business get usable data to feed into the ML/AI?

Is the data in your SaaS applications available to your AI? Is it only available to YOUR AI or to everyone’s AI?

Most examples of AI are writing assist – emails, business plans, marketing copy, blogs. (Great! We are replacing humans writing!) Or chatbots. In some cases, the AI is just fancy IVR.

These are Enterprise uses. That’s who CX and AI are built for. That’s what EC targets: Enterprise Comms. Just remember that Enterprise buys different things and in different ways from SMB.

That’s why it is important to know who your Buyer is and what benefit they get from your services. Otherwise you are chasing a market that

Businesses with Under 99 employees will continue to leverage PBX – from Asterisk, 3CX, Freeswitch, Yeastar, Zultys and others. The on-premise phone system is still affordable and a solid tool. Ask VoIP Supply or 888VoIP.

Very small business (under 10 employees) buy UCaaS – and that is a large portion of businesses in Europe, Canada and the US. Yet not many providers want to target that market. It requires efficiency and has high support costs. And they may not buy YOUR UCaaS because they may want one integrated into the software that runs their business. Or one designed for VSB.

We are on the cusp of seeing more verticalization, specialization and platforms designed for the VSB. Weave has done well in the SMB healthcare space. Others have done well with law, hospitality, retail. This will be the trend.

With the Avaya/Mitel/NEC issues; Zoom/MS Teams dominance; Broadsoft/Metaswitch EOL; BEAD billions; and other factors, I think Voice will go back to being Voice for most businesses and Collab/Video/Messaging will be a separate thing. There is a growing problem with robocalls, scam calls, scam texts. The $4.5M fine on Telnyx for robocalls will also ripple. The mess that is SMS/MMS, 10DLC and the Campaign Registry will also cause headaches for businesses and providers. There are just too many moving parts in telecom for cloud comms right now.

Many CSPs are about to decide of a voice platform for FTTH. That will swing focus, sales, and attention to digital voice, not a full stack CP+UC+CCaaS. That will shift things further for many UCaaS players who are already struggling.

Meanwhile, on the sales front, due to macro-economics, the political environ, the hype of AI and CX (without concrete outcomes), sales are taking longer. Status Quo is winning. That isn’t good for the industry.

Side facts:

ServiceNow is now a CRM and agentic AI company.

50% of CRM projects fail because of a lack of cross-functional coordination. [source]

LinkedIn this morning is buzzing with news that Mitel is going to file bankruptcy to deal with $1.15B in debt. Mitel has accumulated this debt, largely due to financial commitments to its owners, Searchlight Capital, with high interest payments to service the debt. [The telecom universe has many companies that are PE owned and weighted down with high interest debt.]

This financial crisis explains why Mitel wasn’t the winner in buying the NEC assets. Instead the NEC on-premise and private hosting assets went to an NEC dealer, Forerunner. And Forerunner probably has some PE debt as well now.

Some view this move as doom, others feel it is like Avaya who uses BK as a tool.

This does create uncertainty in the market – and uncertainty stalls sales.

Like Avaya, Mitel announced deals with both RingCentral and Zoom. Like Avaya I don’t think this was much more than buzz … for Zoom. Probably the only winner in both deals was Zoom.

Like Avaya, Mitel is focused on UC in on-premise and private hosted. Development is out the door. It is mainly about working with the largest customers to keep them happy. Hence, why Avaya is just working with its Global 1500 customers and all customers with less than 200 CC seats are dismissed. Avaya has presented its competitors with new opportunities. I think Mitel will too.

Will buyers not make parallels between Avaya and Mitel?

SMB prefers on-premise PBX due to a fixed cost. It also doesn’t have personnel to constantly hone and experiment with the communications systems. Out of the box, the comms package has to produce results. A small business doesn’t always get the outcomes they think with SaaS. That is what Mitel and Avaya are banking on, but they don’t want to serve SMB. Avaya has come out and said so. Mitel hasn’t yet.

The Global 1500 Avaya customers are kind of stuck because to migrate off their current duct-taped comms platform would require an interior godfather to evangelize and bet his ass on a new comms platform. That isn’t happening in today’s business environment.

Metaswitch 2.0 was when Microsoft acquired them. Metaswitch 3.0 starts now that Alianza has completed the acquisition.

I have a problem with their PR headline: Alianza Completes Acquisition of Metaswitch from Microsoft to Empower Service Provider Growth and Help Telcos Close a Massive Gap in Services Revenue.  It doesn’t say anything about how they are helping telcos with a massive revenue gap. Not a word. Or really how they would help with growth.

Metaswitch is in the voice network of about 1000 service providers worldwide. For many of them, Metaswitch has a role as a class 4 switch for GR303 and TDM. There is still 30M copper lines in service. Heck, Verizon just moved the NYFD off Centrex!

I don’t see how a wholesale in the cloud softswitch replaces an on-premise class 4 switch for TDM, but I understand that TDM is ending.

Many ISPs just need digital voice. It is where Alianza amd Momentum got their start — tier 2 and tier 3 cableco digital voice. It is where many ISPs will migrate now that the UCaaS battle has been won by Microsoft (I say that tongue and cheek, but I hear it from folks.)

Approximately, 700 of the telcos will just pay software maintenance. There are about 700 mom-and-pop telcos with less than 5K lines.

That leaves 300 to possibly choose Alianza for their next softswitch.

As RAD-INFO assists service providers with switch decisions, there are many questions to answer.

• Does the platform scale? We don’t know how many lines they have now. We don’t know if it can scale to 30M lines.
• Are they financially solvent? There is debt from the acquisition. Can the company stand on just software assurance?
• How will they afford all those Metaswitch people? That is a significant payroll.

These are questions that need to be asked, because no one wants to migrate to a new platform to do it again in 2 years.

Got this in email today: “a recent Channel Marketing Association study found that over 60% of channel companies spend more than $250,000 per year on events—but only 30% track or see measurable ROI.” Well then, if only 30% track this spending, the results kind of are skewed or irrelevant.

Most companies do a lot wrong at events.

The booth graphics don’t give a simple, clear message. Often the messaging is too much (TL;DR) or vague or me, too. At the very least, you want the booth and its graphics to make people stop or remember. Think about all the TV commercials like Liberty Mutual or GEICO or Progressive. The colors are the same. There is a recognizable mascot, even if it is a human. The message is the same, repeated over and over. That is branding in a nutshell. Create recognition of your  logo, your color, your Value Prop or motto. Make it yours.

As I walk around expo halls, I find myself looking at booths unable to discern what the vendor does – and ask myself ‘What were they thinking?” They spent money and didn’t even add a tag line like CyberSec for MSPs or White Label VoIP. How many people are going to ask you what you do? Not many.

If you are spending $250K, that is at least one event per month, so having a marketing plan for these events is important. The plan should be about the brand, the message, the action plan, what you would expect to gain (why and how).

The people in the booth need training. What is the goal? What is the KPI? What should we be asking? What is the profile of the partner we are seeking?

Most booths have the people talking amongst themselves – or looking at their phone. When I have manned a booth, we gamify it. Talk to everyone who walks by. Be friendly. Say Hi.

If you have a tchotchke, offer it. You don’t want to take it back home. It at least allows for an opening question, “Do you want one?” If nothing else, your name gets out there.

Some vendors check ROI on a show by how many new partners were touched. It has to also be how many old partners were touched. How many meaningful conversations?

It would be great if you were able to just talk about deals – how many deals were closed because that person walked by our booth at that show – but that takes sophisticated tracking.

What if the partner saw you at three shows  before they engaged with you? Several partners and I joke about how many vendors will be in Vegas once. We will see them in Vegas and then never again. Partners want to know you are long for the channel, not looking for a quick hit or just dipping your toe in. Why? Because if we sell your stuff, we want to get paid. Can’t get paid if you are out of the channel in 2 years.

What is your sales cycle? If it is 6 months, then you won’t see a sale from any partner for at least a year. Why? Meet them, court them, get the contract signed, on-board them, get the first quote and close in 6 months. And if you are selling to Enterprise, the sales cycle and budget cycle could be 2 years! Most Channel Chiefs don’t last 2 years.

A smart plan is a recognizable booth with attentive friendly staff who are scheduling partners for a webinar or a call to learn more, but who are also disqualifying partners who aren’t a good fit. At most channel shows, there are a mix of channel types – MSP, VAR, TA, TSB – which are you looking for? Know! Stop wasting time with people that aren’t a good fit.

If you don’t have a profile, you don’t have proper messaging, you haven’t trained the staff, then you are wasting money even if you aren’t tracking it.

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