Apparently my tweet upset some folks at Windstream.  Let me explain: USTelecom has a forbearance petition at the FCC to eliminate UNEs. Windstream was originally on the side of the CLECs and INCOMPAS. Then Windstream made a private sweetheart deal with the ILECs and switched sides.

Windstream is an ILEC as well as a CLEC.

Why was the tweet supposedly inflammatory? Because I said “I’d be out for myself too if I had a tiny market cap, huge debt and lawsuits chasing me down.” Windstream is in financial straights. It has been for a long while. The spin off of the REIT CS&L (now called UNITI) was a stop gap measure to try to unburden from the debt.  Windstream owes $5.8 Billion in debt. Revenue has been flat for more than a year.

Market cap as of today 9/17/2018: $215M

There are a number of lawsuits over the spin-off.

If I had flat revenue, huge debt, a tiny market cap and lawsuits chasing me, I would join the ILECs and take a deal for UNEs, too.

Many of my clients are CLECs. Currently I am interim executive director of an association of ISPs and CLECs. CLECs will get clobbered by this UNE forbearance. The fact that Windstream would make a side deal after opposing the petition, it is disheartening.  Hence my tweet.

Is a strong Windstream good for the channel? Maybe. Personally, I have never sold any Windstream services. I sold some EarthLink but not Paetec or Broadview. I never understood the Windstream deal. How could they possibly be less in price on network than the company they were buying it from?!!

Let’s do the math on that.  Even with a sweet wholesale deal at say 30% off retail, Windstream still has to pay commission on this which would erase about 25%. There is also the cost of delivering the service and billing it, which even if efficient would be around 15%.  Under water.

Sure they get top line revenue but a loss. This is a stupid business model. I have seen it time and again.

Then someone at Windstream realizes that they are underwater too often a couple of years ago. The result is a decision to wipe out customers and channel partners to right size it.

I am not certain Windstream will ever be a strong channel vendor. Everything they do is about lowering prices. And no one sings their praises on service deliver so….?  Where’s the value?

PS

If I have to hear how SD-WAN is growing, I am going to throw up. Two years ago SD-WAN sales were practically zero. So if now you have even $2 in SD-WAN sales, growth is up!!!

 

 

 

This company looks like it launched this year. The copy doesn’t express exactly what the company does (or what the marketplace is). A message from the CEO says, “OmniBased is a value-added distributor with a unique platform, focused on offering products via the IT channel.”  Yet the vendors are mostly VoIP companies. Worse the logos are grabbed from the web. Half the vendors – Megapath, Global Capacity, Shoretel, Birch, Impact – don’t exist anymore.

If they are a VAD with a valid contract, they are required by contract to use the appropriate logo.  I spoke with one vendor on the list who has never heard of them.

On the website, they spell twitter, LinkedIn and Vonage incorrectly!

Partners Beware!!

 

It has been a while since I last posted. Much has happened. (If you followed me on twitter @radinfo you would have a good idea.)

5G is all the rage. Technically, it isn’t much different from 4G but it will improve urban coverage. In rural, it will be a way for unlicensed spectrum to be used by cellcos.

Is 5G a threat to cable? Only in that many people hate cable companies and will want mobile unlimited data with low latency which is what the cellcos are hopeful their 5G network will deliver.  Right now the cellular pie is flat. It is all take-away business.

Endpoint management is becoming the new normal. Phonism leads the way but Polycom, Edgewater and others are realizing the importance of remote management of phones.  BTW, Edgewater Networks was acquired by Ribbon for $110M, which is the name of the merger between GENBAND and SONUS.

Atlassian Corp. is acquiring OpsGenie for $295 million. Slack acquired Hipchat and Stride. On a side note, Slack closed $427M Series H at a $7B-plus post-valuation; claims more than 8M daily active users and 70k paying teams; raised more than $1.2B.

Coredial rolled out CoreNexa Contact Center, a CCaaS. They have 300K+ seats. They offer white label Broadsoft and Asterisk.  No idea what platform was used for CC.

Asterisk/Digium concedes it is too hard to be in the HPBX space. They sell to  Sangoma for just $28M. Sangoma already owns FreePBX.  Digium had $30M in revenue in 2017 but a net loss of $4M.

Powernet (aka PNG) and managed IT services provider Maxis360 are merging.

The M&A is off the charts especially in the

PE firm buys SugarCRM.   M&A – App Developers & Digital Marketing: ONGO Framework, which offers custom app development services, has acquired Hockystick Media, a digital media agency.

 

It seems the keynotes for the last several years have been about the Death of the Channel. Today at ChannelCon, it is Jay McBain with that headline. It used to be Tiffani Bova, so maybe Gartner’s only theme is that the channel is dying. If that works and brings in consulting gigs maybe I should start ringing that bell.

I don’t see it though. I see the channel through an 21 year lens. It has always been the Adoption Curve. Some go early; some lag behind. The only difference now is that there aren’t enough new recruits into the channel.

 

CompTIA has seen the writing on the wall: the channel is fading because new blood is NOT pouring into the industry as fast as old blood is exiting.

The other factor is how many providers now lean on the channel. Thousands. Indirect has caught up to direct sales in several instances, especially UCaaS. There are thousands of UCaaS/VoIP and backup providers who sell mainly through channel. Security is big with new companies popping up. The problem is that there aren’t enough partners to go around. (Some of that is due to the fact that every provider thinks their market is everyone. If they were more targeted, they would find great partners, increase margin and win – instead of the struggle bus most of them ride on, following the same strategy as everyone else.)

If I block your name off a press release or piece of collateral, could anyone identify it as yours?

Most of the techies I know are either programmers or work in corporate IT. Meanwhile, MSP M&A activity is happening at a faster and faster clip.

These are probably the most turbulent or elastic of times in the channel.

Side Note:

On the agent side of the channel, CLECs were the feeder system into the channel. Folks worked for the LEC, then took a couple deals for themselves and became agents. That doesn’t happen as often anymore.

CLECs used to recruit on college campuses. Not anymore. I guess CompTIA noticed and decided to do something about it.

 

 

8×8 is spinning up their PR machine about their X Series unified cloud platform. Unfortunately, they didn’t think the marketing out. X Series is generic and well used. Just off the top of my head IBM servers and probably Lenovo too.

I see this often in VoIP. No one considers the search engine at all. Not just SEO, but how about if someone searches x series in Google. Lenovo, Dell, Intel.

I was just at the pitch night for Startup Weekend. Those folks understand: find a URL first. Then grab your social handles. Make certain they are available and make sense for your company or product (or change the name). These are startup people who think this stuff through at the beginning.

Cloud PBX, Cloud Phone and numerous other terms that have been used in the past are the exact opposite of Kleenex. We know Kleenex as tissues. The rest of these aren’t known as a brand – and barely known as product/service offering.

Marketing 101 people.

Footnote: TPX Communications should have realized that TPX was the stock symbol for Tempur Sealy International. That makes it hard to do news searches for TPX Comm, since stock stuff is more prevalent.

Flexential used to be Peak 10. I know there is a story behind them picking that name, but I can never remember it and often misspell it. Again not forward thinking on the search side of life. But, hey, you can always buy search terms to come up first. It is a more expensive strategy than picking a clean moniker.

At least Dialpad understood the value of a name and domain.