Recently in telco Category

CircleID has the story of ILECs and Cable companies once again fighting municipalities, like BellSouth and Cox fought LUS.

With President Obama determined to promote the development of open network telecommunications and smart grid networks we can expect the incumbents to step up their legal battles to stop this from happening.

In relation to the recent $7 billion stimulus package AT&T made a statement that it didn't need the money, but that it would launch a defensive campaign against any competitors using the money to encroach on its territory.

To me, it's anti-American for the Duopoly to fight the city. It's more taxpayer money that could be used for something useful that gets used to fight against two enemies of progress and innovation. Should Lafayette taxpayers have had to spend $500,000 in fees to fight the Duopoly?

There is case after case where the city or town with broadband including FTTB (fiber-to-the-business) has created jobs and added tax base while increasing home values. When the duopoly sues to stop broadband deployment, while crying that it is unfair competition, look at the profit statements of these companies. And look at what it is costing your community.

So a client calls me. An agent sent him an unsolicited quote for 10MB of bandwidth over Ethernet for a ridiculously low quote. Since I have a long history with the client, he offered me the chance to match it and take the order.

So I go back to the carrier and ask for a match. I'm told no. "A competitive quote on the competitor's letterhead is required, which must be 10% to 15% less than the discounted price available with this promotion."

There are a couple of things wrong with this:

1. Why can't I offer the same quote as the other agent -- it's the same carrier?
2. How did tthe other agent get this price without a competitive quote?
3. Why do you want me shopping this client around? If I found a better quote, I would sell him that because you made me jump through these ridiculous loops!

This is the type of policy that drives agents crazy. (Where's the common sense?)  It's one reason that resellers are taking business from the carriers.

I spent a couple of hours at VoiceCon in the exhibit hall yesterday. The biggest surprise was VZB and Sprint. Especially Sprint. They are pimping the Wireline / Fiber with mobile integration. They had lots of new handsets. (So again they can't even have a whole booth about the wireline product).

Here's a tweet from FierceVoIP: "Sprint tightens bonds with cable; offering enhanced VoIP services to basic VoIP offerings - Cable needs Sprint = Sprint needs Cable."

When Sprint chose Dan Hesse to be CEO in 2007, I was against it. He was a Bell-head who had huge opportunity at Embarq that he wasted. What do I mean? Sprint announced its intention to spin-off its wireline business into a separate company at the end of 2005. Dan Hesse was named CEO a full five months before Embarq was formed in May of 2006. Plus any new CEO has 4 to 6 months of a honeymoon period. Hesse had at least 9 months to come up with a plan to do something with Embarq, and did nothing. He cost cut, laid people off, and litigated with the pensioners. That's wonderful.

Then Sprint gets into trouble and brings Hesse  back as CEO of Sprint-Nextel. WHAT? So he lays off tons of folks. Maybe cuts some costs, but does NOTHING remarkable. In fact, since Hesse became Sprint's leader in late 2007, the company has gone on to lose 4.6M customers.

Did Sprint get the iPhone? No. The Android phone? No. Any new and exciting handset? No. WHy not? Handsets drive sales in mobility.

Do people realize that Sprint still has a fiber network? Not even the folks at Sprint can talk about their MPLS or IP offerings for more than 22 minutes without jumping back to the not-so-shiny gadgets.

Remember when Sprint used to try stuff? The pin-drop ads because they had the first all fiber network. The failed ION project. But still they tried.

Now we see that Hesse raked in $15.5M in compensation in 2008. Let's recap:

• stock lost 70% of its value in 2008
• company wrote off billions
• lost $2.8B
• people thought it would go into bankruptcy.
• CEO gets $2.6M bonus on top of his $1.2M salary

This is what's wrong with Corporate America and the Boards of Directors! You wonder why Main Street is fed up. Why consumers don't want to feed the beast any more. Why would I want to spend any more money with Sprint if its all going into the CEO's pocket? And I have to assume that the Directors and other Executives also pocketed some healthy bonus money as well. What a joke.

Amid phone calls with agents who are in a struggle over commission payments with carriers, I have been speaking with finance companies about telecom stocks. Lots of debt out there. Not really enough revenue to cover most debt.

The other problem I see is the operational issues that most telecom companies face. Just getting a quote out of most these companies is an ordeal. And the pricing is anything but standard. Two agents and a Direct will likely produce 3 separate quoted rates. WTH? And that's just to get a quote. Generating a contract, especially from the Death Star, can take up to 10 business days!!

One other discrepancy is that agent paperwork is usually more than a direct sales drones. We have to add a Letter of Agency (LOA), at the least, to show our permission to act on the client's behalf. We also usually have other paperwork - like credit applications - that directs get to skip. Why? No idea, but I have seen enough of it over the years.

So now we get the quote and the contracts. As the agent we explain why we need the LOA and that we won't be taking the client for a ride. We are the trusted advisor, right? Now with signatures and a mountain of paperwork, we submit the order. That's fun too. The order site crashes and saves no work. Start over. The email address doesn't auto-respond with a tracking number. (Re-submit. Re-submit. Call. UGH!)

Then we wait to hear if the order was accepted. Likely something on the paperwork will slow it up. Get that fixed requires being tricky or returning to the customer to explain how we missed a page or a signature or something. When we finally get a FOC date, we are half way there!

Last Ma Bell Internet T1 order, after the FOC date, no install because of address mismatch - over a suite number! One telco closet for the whole building and the address was the same as a DSL circuit and 3 phone lines that the RBOC was already billing to the disputed address.

In cases of fiber, there is usually customer premise make-read work to do. Likely, someone will be told what that work is but not any of the contacts on the paperwork. Even in the case of T1, conduit and other inside wiring issues could delay things.

So now we have the circuit installed. Just have to get it turned up. Tele-installs are great. One person reading from a script talking to the office manager. Eventually it works out.

My advice now is No Managed Router! Ma Bell has resorted to email only to make config changes on the router. No phone to call. One time the tech was in Raleigh. The second it was Singapore. Just to get NAT and DHCP turned on and the SIP phones to work.

The time versus compensation meter is tilting upside down. With rates sliding downward on every telecom service, commissions have too, which means agents are working harder in a broken system to make less money. And that's if you don't have any commission issues with the carrier, which every agent has. It's telecom for gosh sakes. Of course, there is commission errors. Billing errors too.  How did it get this broken?

I'm in Orlando today speaking all morning, starting with CLEC Therapy III. I have moderated three other CLEC sessions that discussed such things as collocation, gear, and technical details. Today, we will be pulling 2 ISP's out of the audience to give them a makeover. In other words, we will sketch what they do versus what they should do.

• Why become a CLEC?
• What is the process to become a CLEC?
• What are you going to offer?
• Who will you target?
• Is there enough margin?
• DIY or Outsource?
• Other streams of Income
• How will you Market it?

After that 2 hours, I will be moderating a panel of ITSP's on How to Sell VoIP. We will examine the sales process to sell VoIP to a small business with 15 handsets. It's one thing to take the step to offer VoIP services to your marketplace; it's another thing to actually know how to sell it. And it won't sell itself. If it did Vonage and SunRocket is all I'm saying - and I wouldn't be seeing MagicJack infomercials all over the television.

Telecom is broken. I can't remember the last time an order went smooth. Well, wait, I can actually, it was a BellSouth Metro E. The REUC order center for BellSouth FCC circuits really knows how to work an order. For 10 years that group in Sunrise FL has been outstanding to work with. (The former DSG and the MEOC had some great people who made my life easy too. Those grooups are gone now).

This week just trying to get quotes has been a struggle, but the topper on the cake has been an Internet T1 install. It was delayed for weeks due to address mismatch -- not the street address, the suite number. (The customer was moving into a bigger office space in the same building). Eventually, I just submitted without a suite number.  On install, client was told that the tech would come back. Waited two days, no tech - then told by provisioning that no tech was coming. We finally get to the turn up and I walk the customer through the install on the phone (twice actually, two different people). We get through turn up.

The managed router did not have NAT or DHCP turned on. One day  just for that. No phone number for router configurations. You have to order changes by email!!! And only from the 2 email addresses on the order form. WTH?

Then we add the IP Phones, but we need to modify two lines of the config. We are waiting again.  This is too convoluted for me. The ROI is negative. The turn up alone was 20 hours of time. 

Can anyone guess what carrier this is?

ACC Business is a subsidiary of AT&T. It uses the AT&T network to provide voice, data and Internet services to small and medium business via agents only. ACC Biz does not have a direct sales force. Tech support and billing through ACC Biz is actually more customer friendly than using AT&T. And ACC Biz is MUCH easier to deal with.

When ACC Biz lost Ben Ho as National Sales Director last year, I started to ask what's up. AT&T has a love-hate relationship with their channel. They love you when you fall in line and sell what they tell you to and hate you when you don't. (You can guess where I sit, right?)

So watching the internal moves being made at both the parent company and the step child, my prediction is that ACC Business gets swallowed whole in 2 years.

The product line at ACC Biz hasn't changed much. They are just now getting Ethernet offerings. No VoIP or SIP Trunking, which has been a big hit to SMB. Add in the personel changes, like Dan Morford and Ben Ho, and you have to wonder, what the future holds.

It looks like AT&T is heading for a strike. Most people at AT&T I know have already been cross trained (I use that term loosely) to handle union jobs. A wholesale account manager will be heading to Michigan to be a T1 installer. Nice. Glad I don't have any AT&T orders in the system.

Also, it looks like AT&T is keeping its sales meetings quiet. (No logos. No banners.) I guess they are afraid that if the union or press get wind of the mega-bucks parties that they threw in Dallas in January and next month in Miami, that there might be trouble. The 94 Solution Providers that won Champion awards are set to meet at the Diplomat in April.

There has been much discussion about ethics in the channel. How ethical is it for carrier channel managers to poach agents and deals away from master agencies to move them to "preferred" Champions? This has been going on for some time. It doesn't say much about the Integrity of people in the Channel. And if you are a Master Agent who benefits from poaching, it comes around. The only thing anyone at Bell is loyal to is there own pocketbook. When you start slipping -- and they all do -- you will be thrown by the wayside and picked apart -- to help build up the next "preferred" partner.

IBM

Image via Wikipedia

has a study out about how Social networking has co-opted many minutes of traditional talking.

 

People are communicating more things to more people than ever before, and not just by phone anymore. Internet-enabled communication models are gaining audience, attention and market share at the expense of traditional telecommunication providers (Telcos). Can Telcos fight back and find new growth opportunities in this rapidly changing ecosystem? The challenge is not just in understanding the technology, but also the unfolding fundamental shifts in human communication behavior.

Facebook, SMS, twitter, LinkedIn, Ning, YouTube, Ustream, and all the rest of the social media strata are where people are communicating. IM/chat like Skype, Google Talk, Yahoo, and MSN also have taken some minutes out of the system.

If you look at usage of cell phone minutes on the youth, you will see very little talking but lots of texting and web access. (Maybe charging per minute caused that). The primary communication method is social networks not telephony.

Telcos are losing landlines, mainly to cellular replacement. Certainly, cableco bundles have taken some landlines, but studies show that in this economic mess folks choose the mobile phone over a static line. Add in the fact that the next generation doesn't eat up minutes means that long distance revenue will be dipping as well as landline counts.
 

This presents a problem for telcos because the content folks don't want to share the revenue, which in many cases they don't have. Twitter, Facebook and Hulu are all having a challenging time monetizing a rapidly growing platform.

People are communicating in new ways -- and none of these innovations came to you from Ma or Pa Bell. Surprised? I'm not.