A look at the new Blackberry that was displayed at ITEXPO East 2013 in Miami last week.
The new phone goes with the company name change from RIM to Blackberry.
]]>Cell companies are stuck. After years of leveraged cool handsets to drive sales, cellcos are stuck as hardware providers - subsidized hardware too.
Cellcos aren't alone. VoIP providers are stuck in the hardware space too - phones, headsets, switches and routers.
On the one hand, the customer is getting it all in one stop and the ITSP (VoIP provider) can ensure that the gear inter-operates with the VoIP service. So that is good. However, there is a capital outlay involved, a lease arranged, or some other factor that can deter the sale.
Subsidizing phones plays heck with cash flow for cellcos. The subsidized handset results in more risk for the phone company, since if the customer goes belly up, they may not collect that ETF. The value of the contract is shadowed by the handset subsidy.
Even with BYOD (bring-your-own-device), the phone companies are still stuck with phones, with hardware - and the logistics and support that come with it. Their support costs would increase dramatically and customer profitability would decline, if they abandon hardware right now.
Consumers haven't separated the device (the phone) from the phone companies (cellcos or ITSPs) or from the phone service. If the device breaks or voice quality is poor, the phone company (VoIP or cellular service provider) takes a consumer satisfaction hit.
The phone companies have to start planning for a time when they can distance themselves from the device. What will support look like? How will they market their service?
]]>Tech Data is the 2nd largest VAD at $26 Billion after Ingram Micro (at $37.8 Billion in sales), but TD is located in Tampa Bay, where I reside.
Tech Data has a long standing sales agent agreement with XO. Next, it established a cellular master agency with TDMobility, which also offers MDM. Then last year, TD inked a deal with master agency, Microcorp. Tech Data has long dabbled in telecom, without actually embracing it.
CDW has a telecom division that is doing very well.
SYNNEX has a $180 million per year telecommunications division, according to an executive bio I read today.
Ingram Micro inked a deal with TWC and CenturyLink.
Adam Edwards at Telarus thinks this is great. I think it is the beginning of the shift for distributors to take over for most master agencies for network services. For straight telecom services, the distributors are in a better position to automate the process for the channel and for the carriers. In fact, for cablecos who lack the automation for channel sales, working with a VAD may actually enhance their channel opportunity.
When stuff becomes a commodity like T1, broadband, cellular, voice, hosted email, web hosting and hardware, margin comes from efficiencies. I see much of this, especially in the small business marketplace becoming something you buy at Amazon or Best Buy fairly soon. The more savvy VAR's will have a check box for each service to insure that the customer has it taken care of -- and to see if she can take it over under her billing or management. The total wallet share idea.
Where does that leave Master Agencies? They will have to morph like some of them are doing into either an extension of a carrier's channel sales division or a cloud service brokerage. Unfortunately, even in both those realms, they will be competing with VADs. SYNNEX, Tech Data, Ingram Micro and Arrow have cloud platforms. Sprint is making a play in this space as well, utilizing its Parallels system to sell cloud services to its wholesale and retail customers. APNI and VoIP innovations both rolled out private label Hosted PBX services as well. It seems we have come full circle in VoIP - white label, wholesale, retail, wholesale, white label.
I think cloud will be the sticker service. Once you start selling even Hosted Exchange or Sharepoint, are you going to want 2 vendors for this or just one?
Everyone seems to be scrambling to figure it out - masters, carriers, CSBs, VADs - and even the Agents and VARs, who are the ants marching in this scenario. It takes some real thinking to figure out the next move and then the next one after that.
]]>Today, the Duopoly is cheering because President Obama nominated a lobbyist as the new chair of the FCC. I get the revolving door effect in DC, where people go from the regulatory agency to the private sector that they just regulated. To the average taxpayer - well, they don't notice do they? But to the taxpayer who is paying attention, we just want to kick their butts.
Today, the entire telecom industry is basically unregulated. Very few states still have a regulated LEC. With the clipping of copper, carrier of last resort options decline as does the ability for CLEC's to provide service. Oh, how we will wake up in a few years with huge bills, lousy service, no competition and no regulation. You will just have to like it a drink a cup of STFU.
This cracks me up: "Mobile operators including largest U.S. wireless carrier Verizon Wireless and No. 2 AT&T Inc. "should benefit from a focus on their economic health" by a Wheeler-run FCC, Paul Gallant, Washington-based managing director at Guggenheim Securities, said in a note today." Their economic health???? It isn't the FCC's job to worry about that. The FCC has one mandate: Protect the consumer.
Tom Wheeler ran both CTIA and NCTA, so the cable and wireless companies were popping corks last night. I hope they get the same surprise that the COMPTEL members got from McDowell. I doubt it though. This administration - both at 1600 Pennsylvania and at 445 12th Street SW - have been huge disappointments. N o one gets that our nation's very economy ebbs and flows with our telecom infrastructure. Idiots.
]]>DISH merging with Sprint would be interesting. I mean, who wouldn't want Blockbuster stores to also sell satellite gear AND cell phones? It would look like a mini-Best Buy.
As TechCrunch explains, "That pre-existing deal came with a lot of visible support from both Softbank's and Sprint's top management, and came also with financial help worked in for the continued build-out of Sprint's network."
Would DISH be able to help Sprint build out a network? Now it would be 3 sets of spectrum - DISH, Clearwire, Sprint. It would be wholesale and retail. It would be Satellite TV and cellphones and videos. Did Charlie ever (successfully) do anything with Blockbuster? DISH announced that it sold the British arm of Blockbuster video last month.
]]>Oracle bought Tekelec, which was known for its Class 4/5 TDM switch in the day, but is now referred to as a signaling company. (Huh?) On the heels of its purchase of Acme Packet, I have to wonder what Oracle sees in the telecom industry that I am missing. Consolidation and bankruptcies are coming. There is too much debt, too much disappearing revenue, and too many companies that do the same thing. There are a thousand VoIP providers out there who could buy a telecom package from oracle IF they had more than 300 customers and any profitable revenue. Unfortunately, most of the VoIP companies can only take orders and not sell. It has become a whore's game of how low can you go - in LD, international, termination, toll-free, and POTS line replacement. It will be interesting to see if these purchases end up being Oracle's Palm.
Global Capacity came out of bankruptcy with a new owner, Pivotal Investment; a new PR firm, iMiller; and new marketing spin in the One Marketplace. Netwolves, UNSI and EarthLink have joined the platform either to sell circuits or to extend their reach for MPLS.
The FCC released its wireless study that Congress requires but doesn't read. ARPU has been steady from 2009-2011 but voice revenue is dropping as data revenue increases. Is the wireless industry competitive? The report doesn't say. What do you think?
Broadsoft released UC-One, its IMS FMC offering. Basically, after signing up 400+ customers, it now has to sell deeper into each account, because there are no more new accounts. So all you BSFT customers, start selling IMS and FMC vis UC-One. Leslie says so.
Broadsoft also blogged that UC demand was outpacing supply, which makes me laugh. On the street, where sales are actually made, customers are seeing 2-4 quotes for phone service. No one is asking for UC, but that doesn't mean unified comms isn't being quoted and sold. Why would the analyst say that? One, he might not be watching enough service providers to see sales growing. Many of the VoIP companies are private and don't do PR or report numbers to anyone, so how would any analyst know the size fo the market, revenues, sales, seats sold, etc.? Two, UC is being quoted but not being purchased - due to poor sales skills or customer sticker shock or the fact that Premise PBX are still selling. Finally, it could be that UC only works with integration. So if the customer isn't using the 3 or 4 applications that integrate with the UC platform, it won't be a good fit (or will require big dollar integration). There are number of reasons why UC sales look dim. A lot of it is education to the customer and to the sales teams, but also a lot of businesses just want fast Internet, a smartphone and cheap dial-tone.
]]>Personally, I think these CEOs - Crowe, Hesse, and others - have to take more responsibility for revenue, integration, value and culture. The role of CEO is more than just setting some ambiguous vision that your reports then have to crystallize and execute on.
Best quote from Mobile World Congress:
"Openness is not something to be afraid of. There are lots of business models available. But openness is also about being open to innovate." - Jolla CEO Marc Dillion (launched Sailfish at MWC)
FCC and FTC gave the green light for T-Mobile to merge with MetroPCS. To VZW and ATT, this is a yawner. To the consumer, it will just eliminate one of the all-you-can-eat players.
This news comes as Gary Kim writes about the spectrum crunch that never came. Please note that all of the Top 5 cellcos still have a bunch of spectrum that they have not deployed yet. It bears repeating: there is plenty of spectrum that they have not deployed yet! (Despite what Hesse spouts to the press. He likes being in the spotlight, which is fine, if someone else was running Sprint.)
Susan Crawford wrote an article about the lack of wireless competition. Every flavor of broadband - terrestrial or wireless - has clear winners and losers, but mostly losers, who we call customers.
I have beat this drum before but all the value in the US economy is in knowledge and innovation -- it is the Internet Economy. Stifling that due to profits for a few companies is not going to make the US competitive in a global race.
Nice blog about small business, Obamacare and the opportunity for channel partners.
In SAAS, the secret sauce is data integration - which fails almost 20% of the time!
One last one: at CPExpo, a channel AVP at ATT was given my book and read it and took the time to come over to say that he enjoyed it. Kind of a highlight at the show.
]]>Saw this picture on twitter. It made me think about the lack of innovation from the telcos.
For example. cellular and DSL technologies were discovered by Bell Labs in the 1960s, but didn't to market until decades later. And it usually wasn't by AT&T -- it was from a market disruptor. Think Covad for business DSL; Yipes for Ethernet; and Vonage for VoIP.
The ILECs launched Centrex but only recently started to offer IP Centrex - or Hosted PBX as we call it today, despite Broadsoft's second customer rolling it out in Tampa in 2003.
In most cases, the innovation is in the devices. Handsets add all of the coolness to cellular service. Wireless AP's add the utility to broadband modems.
Just food for thought.
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The new phone goes with the company name change from RIM to Blackberry.
]]>An interesting announcement today two weeks before thier customer summit, Cisco bought a stake in Parallels and gets a Board seat.
Parallels is the middleware for many cloud providers, customers that Cisco would like to sell a lot of stuff through. This might be a response to the cooling relationship between Cisco and VMware, according to reports.
Alltel is completely gone now. AT&T grabbed the leftover assets (customers 500K+ and spectrum) of Alltel for $780 million per VZW's divestiture of Alltel after their 2009 sale.
Google updated Panda again. SearchEngineLand has this to say: "Google has announced a new Panda refresh, making this version number 24. This refresh has a noticeable impact 1.2% of English based queries according to Google. The previous confirmed update was #23 and it impacted 1.3% of English queries on December 21, 2012. Prior to that was a refresh on November 21st that impacted 0.8% of queries. It seems like Google is now rolling out these updates every 4 weeks or so."
Panda is Google's algorithm for search results to " helping people find high-quality sites in Google's search results."
]]>VoIP in the US: Market Research Report states that consumer VoIP is flat, but cable voice (VoIP) and cellular voice (also VoIP) are growth markets -- but both are primarily consumer. ??? IBISWorld looks at 860 companies in the VoIP space representing $15B in revenue in the US. Yet they list 873 MSO's in another report.
Forbes agrees that - despite the free offers from the likes of Skype and Google Voice - the VoIP industry in the US is a $15B business. How much of it is about Mobile though?
Everyone is impressed with IBISWorld stating "that the VoIP industry has experienced a 16.7% annual growth rate in the last five years." Umm, most of it is about POTS and TDM replacement. Have you tried to order a TDM PRI in the last 18 months? Almost all of it is SIP Trunking with PRI signaling at the customer premise from the IAD. BTW, that is NOT a PRI! Dynamic T1's, FiOS voice, cable digital voice, cellular voice -- all are VoIP, so to say that it grew less than 17% per year isn't that big of a deal. In addition, there has been a proliferation of VoIP players - like Vonage, Skype, MagicJack, etc.
Look at RebTel. All of the sudden they have 20M users and $80M in revenue.
It's the Hosted PBX and UC space that has dismal growth.
One reason is that the replacement stuff like SIP Trunking, cable and cellular just kind of happen. Replacement sales are easy. It's what the industry as a whole is trained to do.
But the move to UC or Hosted PBX is more than a replacement and requires what looks like work. Here's hoping 2013 is the year for Hosted PBX sales. I'd like that to have a 16% growth (and so would all the CCA VC's!)
]]>Airlines want full planes. Customers don't want to be sardines and have bags checked for them.
Consumers hope that not everyone is using the Internet at 8 PM. The ISPs need over-subscription for their business model to succeed.
Cellular carriers want the radios on towers to be to capacity. The users want to be able to actually use their smartphones as advertised.
Restaurants need to be busy to make money (especially for the wait staff). Foodies hope that there isn't a line to get in at their favorite bistro. Others hope for a seat at the bar.
How does a business model succeed when it has to be full, cramped, stuffed, oversubscribed, which makes the customers miserable? Fact is in many cases the model doesn't work.
Look at airlines, how many have gone bankrupt or needed bailouts?
Restaurants have a large failure rate, even with a great chef.
When you are at odds with your customers' experience or expectations, scale (getting bigger) doesn't mean better at all.
]]>Broadsoft announced UC One and now Rich Communications Services (RCS) to be added to its BroadCloud SAAS platform. [UCStrategies]
After Softbank put $20B into Sprint, Sprint turns around and buys some US Cellular markets for $480M. Consolidation - that's all we have left as an industry.
RUMOR! Google and DISH launching wireless network! This is the rumor, since the FCC is about to rule on spectrum that DISH controls (40 MHz of MSS S-band spectrum in the 2 GHz band, that the FCC renamed AWS-4). This spectrum may get cropped and added to the H-block auction. Should have an FCC announcement by Thanksgiving.
Right now, One in five smart phones sold in the U.S. is from the Samsung Galaxy series. I guess the $1B patent fine was nothing!
]]>There is talk about AT&T using this big announcement to force state utility commissions to allow for the clipping of copper. If you want LTE and fiber in your community, then AT&T gets what it wants. Never has there been a better time for CLEC's to SELL DEEP and invest in their own fiber.
]]>Tech Data already has a direct relationship with XO. I mentioned that it isn't going stellar - and I want to elaborate. Tech Data, like any hardware VAD, has a unique model built around distributing hardware and software (licensing) for partners like Cisco, Microsoft, HP and IBM. The VAD works on slim margins - like grocery chains - counting on co-marketing dollars and other incentives from its partners to bring in revenue. Those co-marketing dollars (and associated quotas) dictate the attention that a partner gets, the same way the P&G pays to get perfect placement for Tide on the laundry aisle.
Smaller partners are relegated to the corners of the website or among the millions of SKU's in the catalog.
The VAD has tens of thousands of VAR's as customers, but hardly any are exclusive. When I was working for a VAR we had accounts with SYNNEX, TD and Ingram. A purchase comes down to pricing, stock and location. A battery backup from APC is very heavy. You want it to be available (in-stock) in a warehouse as close to the end user as possible to cut down on shipping costs (and delivery times). That - more than anything - determines a transaction.
Now as we move from inventory to services (cloud or telecom), things change. VAR's will not want to have to log into numerous systems to place orders or check status, so one VAD will win the majority of the business from a VAR. No longer will a VAd have tens of thousands of (shared) VARs. Once a VAR chooses a VAD for a servcie - whether that is Office 365, backup, or cellular - it is very likely that the VAR will stick with that VAD for all future similar transactions. A very different model for the VADs to deal with.
What else changes? All that warehouse space and inventory will shrink as the shift occurs from hardware to services.
Now in the telecom space, while TDMobility may have a handle on the paperwork for a cellular sale - a very transactional sale - the move to voice, Hosted PBX, MPLS and SIP Trunking will be very different!
The VAR's won't know which carrier to ask for quotes from at first, so there will be a lot of channel manager intervention (or a crap ton of useless quoting).
Telecom orders require a lot of paperwork - agreements, surveys, LOA, etc. Clean paperwork hand-off results in a happy customer, an accurate order and usually timely compensation. There isn't any online ordering. The missing link here is twofold: (1) back office; and (2) access to VAR's.
Telecom doesn't have a back office system. There aren't any API calls that can be added to improve efficiency. There is just a mess of manual systems that will have to be pushed, poked and jeered.
Imagine if you will, a VAR putting in a quote request for a cable broadband circuit, getting a site survey form (that resembles a service agreement more than a little), submitting it, waiting, getting an okay, and then ten days from the start told that it is a no-go.
Or an order for a 10MB DIA circuit languishing on someone's desk at a CLEC office for an extra month or so before frantic calls get it moved up the supply chain line. You think I make this stuff up? In 2012, telecom is more broken and antiquated than it was in 1996. How you can talk about cloud services and not build one cloud service from the ground up to act as ordering-billing-ticketing is beyond me.
Access to the VAR's is another hurdle. There isn't a gate to get at the advertised "60,000 resellers". TD's own people don't know the event schedule. Only a handful of the VAR's attend the show - like the Agent shows as well. This adds even more shows to the schedule for both Microcorp and its carrier partners. Despite this time and monetary expense for an additional show schedule, will you touch enough VAR's to make the process (and partnership) worthwhile? We will see.
I'd like to know how the commission situation is going at TDMobility in cellular. I know of authorized agents who have filed lawsuits for carrier-wide abuse of charge-backs from cell providers. Commissions are the reason we are in this - and those commission numbers will be sparse in comparison to Ingram's $36B in annual revenue and TD's $26B.
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