On Rad's Radar? - xo Archives

Interesting Links for Your Consideration

2013-05-14T17:11:47Z

There have been some interesting articles lately. I can't get to all of them, but here are some good reads.

Death of the Telecom VAR in 2013 - How an entire sub-industry will be wiped out in the next 24 months by Jeff Hawkes. "Traditional telecom VARs or value-added reseller businesses- those that derive the majority of their revenue from the sale of on-premise PBX equipment to business customers- have ridden one of the longest product life cycle waves in recent technological history and combined with an emerging threat from hosted phone providers and a professional background that leaves most ill-prepared to run a business larger than a few employees is threatening to wipe-out or dramatically alter an entire sub-industry in the next 24 months." He writes like me.

Not telecom - but patent law - Monsanto wins a big case. "The court ruled unanimously that an Indiana farmer violated Monsanto's patent on genetically modified soybeans when he culled some from a grain elevator and used them to replant his own crop in future years."

Infonetics scores Comcast, Verizon, 8x8 and XO top North American business VoIP providers. SIP Trunking is the big winner. Revenues are the big loser as SIP trunk is used as a low price dial-tone replacement.

Blair Pleasant is "still not convinced that the cloud is the long-term panacea."

Doug Mahoney reports that HD Voice is Experiencing Unprecedented Growth globally.

YorkTel's VideoCloud integrates with Microsoft. So I wonder how Skype feels about that.

lastly....

The Cash Cow is Dying: Mobile Networks Face Bleak Future (based on SMS and LD revenue). Lucky for cellcos that Metaswitch just released Clearwater, an IMS implant.

RBOCs Declare War on CLECs

2012-12-06T17:58:29Z

This is a letter from telecom lawyer Kris Twomey to the members of FISPA, an association for ISP's and CLEC's. I know that Politics and Regulatory talk puts you to sleep or bores you or you don't have time for it - but these proposed changes to the Telecom Act WILL affect you!

"One of the questions I am often asked by ISPs considering starting CLEC operations is whether access to unbundled network elements ("UNEs" or "the copper in the ground") will continue in the future. My response has always been something like, "Of course, the Telecom Act guarantees it. Congress would have to revise the Act for any changes to impact UNE availability." Those of you that know me know that I don't get involved in hyperbole, and I'm basically too optimistic to accept any sky is falling-type theories. Now though, there's something brewing in D.C. that genuinely worries me. Turns out AT&T has a plan to wipe out the Telecom Act of 1996, or at least, the parts regulating interconnection.

"I think the next great telecom policy battle is at hand-- nothing less than an attempt by AT&T and others to dismantle the Telecom Act, destroy CLECs, and essentially codify the ILEC/Cableco wireline duopoly. Smaller CLECs need to get organized and respond.

"Debate has begun on all fronts about the future of telecom regulation and I believe we are at the precipice of major change. Over the last couple years, AT&T and Verizon have been quietly lobbying for the FCC to consider rules to transition to an all-IP network, or in ILEC-speak "facilitate a sunset of the POTS network." Verizon is even using a natural disaster to justify removing copper (and therefore interconnection rights) from its network: Other ILECs have been murmuring that the Telecom Act is now 15 years old and needs to be updated.

"On November 8th, AT&T filed the first real proposal with the FCC to "modernize telecom regulation for an IP world." The petition is here [pdf].

"The AT&T petition is a direct shot across the bow of the FCC and CLECs, essentially daring the FCC to act. The petition is breathtaking in its audacity. Here are its main points and suggestions":

Eliminate the availability of copper loops (all UNEs, really) in certain central offices as an experiment and see what happens;
Limit the time that CLECs can object to ILEC notices of network changes;
Reduce state utility commission regulatory authority;
Allow ILECs to remove all copper facilities when the feeder (such as a remote terminal) is upgraded to fiber;
Eliminate legacy ILEC regulations such as carrier of last resort obligations, long distance parity, etc.

"Various stakeholders have responded. The National Regulatory Research Institute, a group representing state public utility commissions, issued a paper on the TDM to IP network transition (here).

"The trade associations have begun to weigh in on AT&T's proposal. CompTel and individual CLECs have lobbied for pro-competitive policies and filed proposals concerning the IP network transition, preserving access to copper loops in fiber-fed ILEC networks, and requiring direct IP to IP network interconnection.

"The cable trade association, NCTA, filed a response to the AT&T petition arguing that the FCC should take its time developing a record. After all, they've actually got a pretty good deal under the current rules. The NTCA, which represents smaller ILECs, filed its own petition on November 19th seeking regulatory relief.

"I am concerned that there is no organized coalition of smaller facilities-based CLECs to defend its interests and propose alternative ideas. I fear COMPTEL will push the interests of its large CLEC members over those of smaller CLECs. I do not think that necessarily the interests of Level 3, Windstream, etc., that do not purchase many copper loops, will adequately align with those of truly local competitors in suburban or rural markets reliant on central office connectivity at regulated rates. I'm especially worried because, well, those "local competitors" describes virtually my entire client base and the businesses of many people that I consider friends." [RAD's note: Mine too, btw]

"As a preliminary matter on strategy, I believe that it is fruitless to solely fight against a policy without offering clear alternative proposals. I also think that by refusing to acknowledge the legitimacy of some opponents' suggestions detracts from the power of our unique ideas. I have several alternative, pro-competitive policy suggestions that would truly represent a modernization of the current system; seek to even the current playing field; and give the ILECs relief from some of the legacy regulatory requirements that are arguably outdated. For now though, it is better that these ideas remain off-list until consensus positions can be developed by a group.

"I have spoken to several of my facilities-based CLEC clients that are interested in forming an organized opposition to these attempts to gut the Telecom Act both at the FCC and to lobby Congress for a true modernization of the Act. I will be hosting a conference call for interested companies on Wednesday, December 12th at 2pm EST. The call is restricted to optimists--those that do not subscribe to the defeatist notion that the ILECs must always get their way. I have some very specific ideas and policy proposals, but am not pre-disposed to any particular strategy. I think it's time for like-minded companies to join forces to protect their interests and I'd be honored to represent them. Please contact me off-list at kris at lokt.net for call-in details."

[RAD Commentary] The RBOCs lost a court battle each recently.

VZW lost in Appeals court its fight to forbear cellular data roaming. It challenged the FCC's authority on this matter and lost.

Meanwhile, ATT lost a data throttling case in small claims court.

Copper clipping will affect Agents because EoC is a big deal - but requires copper plant!!!

XO, TelePacific, MegaPath and other CLECs would lose territories that they could offer EoC and flavors of DSL. ADTRAN, Zhone and Overture Networks make the geat gear that goes in the CO for CLEC's to provide EoC. These companies would be affected as well. Can you see the ripple effect?

How about affordable mid-band Internet Access for the SMB space? That is what EoC is - and it will go away.

Channel Moves

2012-09-05T17:49:39Z

Zayo decided to keep the AboveNet channel intact with Angelo Germani in charge. Zayo announced that zColo's products and services will join Ethernet, Wavelength and IP products for sale via channel partners.

Windstream is partnering with Lifesize (a division of Logitech) for HD Videoconferencing equipment. Paetec has long offered equipment for lease to SMB to go with services.

Windstream has hired Anne Brogan, formerly at NITEL, as National Channel Manager, just about 6 weeks after the channel head, Dan Sterling, was let go and Jeff Howe assumed his duties. Good Luck, Anne!

CloudTC, the Android based IP desk phone that debuted at StartupCamp a couple of years ago, has rolled out to the Channel.

West IP (formerly Smoothstone) has a really cool new website. Luv the madness screamer! With the website revamp comes MediaCloud, a Microsoft Lync offering.

8x8 is going global - to Canada and the UK, according to UC Strategies. A lot of that info was covered in these two blog posts - CMO interview and Agent interviews.

The timing on this announcement couldn't be better: RadioShack launches MVNO service! They are so good at customer service that they have become a service provider. Lucky for them, telecom - much like airlines - has a very low bar for customer care. Oh, they answer the phone and quote you policy but that's about it. RS will fit right in.

Once upon a time, OC-192 networks were the way to measure a network's manhood. Now it is 100G. XO rolled out 100G nationwide.

IRONY of the Day: The guy I wrote about that thought Agents work part-time, just got a new gig as a channel manager. I guess that part-time agency plan went down the tubes. I just hope he works full-time as a channel manager - just not as MY channel manager.

If you will be at the CPExpo next week in Orlando, let's meet up. The TCA is holding its 4th year Anniversary on 9/11 at 7:30 in Orlando. Register here. See you there!

Various Tidbits

2012-07-11T16:40:49Z

Two of my pals work at Counterpath. It went on NASDAQ today. Congrats! "CounterPath Corporation (OTCBB: CPAH) (TSX-V: CCV), an award-winning provider of desktop and mobile VoIP software products and solutions, today announced that its common stock will commence trading on the NASDAQ Capital Market on July 11, 2012. The stock will continue to trade under the symbol "CPAH" on the NASDAQ Capital Market and under the symbol "CCV" on the TSX Venture Exchange." Counterpath is a Vancouver, BC, Canada, company. Big VoIP/tech hub there.

CenturyLink wants more than the 30% of the $300M USF reform fund called Connect America. In fact, they want to overbuild on existing WISP's with that money. WISPA Opposes the new federal Subsidies for CenturyLink. Personally, I don't think that any LEC or MSO should receive federal funds. If we had the best broadband in the world, I would say okay - that's worth the money. We don't. They spend more than $300M in lobbbying per year!! Spend that money on broadband. Plus there are small businesses called Wireless ISP's already in that market that C-Link is going to spend tax dollars to put out of business! That's the Corporate Way!

MegaPath has the largest Ethernet over Copper footprint in the US. There are 600 Central Offices with ADTRAN Total Access 5000 gear to provide facilities-based EoC up to 20 MB.

Data Centers are growing. That was actually a headline yesterday. No kidding!

Health Care: What HIPAA Means for Data Centers. My understanding is that transport isn't a worry - and there is no such thing as HIPAA compliant transport! It is all about the storage, security and handling of the medical records - physical or electronic. That also means data centers have to be secure and tracking visitors, in case one gets access to a storage device. BTW, it is HIPAA, not HIPPA. How can you even say you are compliant if you get the acronymn wrong?!

Dell Voice is offered in Canada as a competitor to Vonage Mobile. Dell Voice is now on Blackberry, just in time for their corporate jet auction.

XO introduces a purple logo and a new XO Partner Program.

I remember all the WinTel articles about the Intel-Microsoft alliance dominating tech in the 90s. Today, not so much.

Voice Carrier wasn't thinking when it named itself. Branding rule number 1: if they can't find you in search, you don't exist. Didn't you learn anything from Xerox or Kleenex?

"Today services like Dropbox give people access to their work anywhere, any time, on any device, and users love it. (52% of our survey respondents said Dropbox is used in their organizations. Only 12% of IT departments are supporting it.)" How Mobile Consumer Devices Drive Cloud Applications in Enterprise IT.

Are you like a dog with a bone about anything?

The Mobile Master Agent

2012-07-03T00:01:37Z

There is a lot of chatter in the Channel about Transactional agents being replaced by VAR's and Consultative Agents. I see Master Agents having to do a similar dance real soon.

Tech Data is one of the largest VAD (value added distributors) in the world. Most VAR's have an account with TD to buy hardware. The TDmobility division is a master agent for cellco services. Moreso than any master agency I know of.

Now Ingram, the other large VAD, just bought BrightPoint for $650M. 'BrightPoint distributes mobile phones and other wireless devices sold by companies such as Apple Inc, LG Electronics Inc and Nokia Oyj to customers, which include Sprint Nextel Corp, Vodafone Group Plc and RadioShack Corp." basically, BrightPoint is fulfillment - one of the big hurdles in the MVNO world.

Ingram is becoming a Cloud Aggregator and a Mobile Aggregator. Tech Data is a Master Agent for mobile, XO, some cloud and MDM. This might be where the transactional agents end up: as customers (or partners) of a VAD.

Is it Cloud versus Agents?

2012-05-02T16:45:52Z

Is it Cloud versus Agents?

As an Agent, I sell bandwidth and transport almost exclusively. I am learning that the Channel does not want that business. The carriers do, but on the wholesale/carrier side. No 10GB private lines. No 1GB ports. Nope. The Channel wants Multi-site multi-access customers. That's fine. Just stop talking about your fiber map then. It's irrelevant for that kind of sale.

The CLEC's also want Agents to sell Managed Services and anything Cloud. That's nice but who cares?

Cbeyond announced that they are "no longer recruiting traditional telecom agents". well, they already signed up the biggest masters - CMS, Telarus, Microcorp, TBI, etc. So what they are really saying is that traditional agents will have to use a master agent to get paid. That's becoming Normal in telecom. Carriers just want to deal with master Agents. I guess, they think that is more effective or efficient. I have no idea if it is either. We'll see, I guess.

Like so many other providers, Cbeyond thinks that the answer to its cloud strategy will be VAR's. That's not likely to happen.

VAR's don't trust telco. (Heck, I'm still waiting a month for an FOC from XO on an Internet T1, so I totally get the attitude.) VARs already have relationships with VAD's like Ingram and Tech Data, who can provide most of what Cbeyond is offering - or they can provide it themselves. Would you go to Rackspace or Cbeyond or EarthLink for hosting? That's basically what it comes down to: who is doing the hosting.

Right now Microsoft itself and carriers are getting into the traditional VAR space (offering hosted Microsoft products and data backup). Why would VAR's shift from a reseller model to a sales agent? It's kind of like, do you want white-label or straight resale?

The thing that most miss is that it is all about Control. In white-label, you can build a branded business that you have a decent amount of control over, especially in Hosted PBX. In straight resale, the bill, the brand, everything is in the carrier's name. No control at all.

My clients - CLEC, ISP and ITSP - want the illusion of control - or at least as much control as they can get. VAR's want the same thing. In the case of the ISP and the VAR, they like technology, but selling and marketing not-so-much. And you won't have much success forcing them into a sales+marketing shop - any more than you will trying to get T1 slingers become Consultative Sales people pitching cloud. Why? Motivation. Comfort Zone.

Robin Robbins has a very successful business offering turn-key marketing programs to VAR's. Cloud providers need to plug in to that kind of a system.

XO just re-launched its old hosting brand, Concentric, probably to get some space between the telco and its cloud services. (XO has to do something about its reputation in the telecom space and re-branding buys them time until someone buys them.)

Some Agents will obviously move into this space. Some already have making money on Cloud Comm like Hosted PBX, UC, IVR and conferencing. Some have sold collocation - although its a big leap to PAAS and IAAS from colo. But virtualization might be a nice tool in that box. It will come down to who you trust to deliver it.

I'm not saying Agents shouldn't be shifting their business. Lord knows that the way it is now, it is extremely tough to make the living we are used to while selling what we are used to. So a shift has to come. I just don't think it will be to the same carriers that make it in the future. When you look at things like commission adjustments, contract disputes, channel segmentation, and the like, Agents might want to try another silo of vendors to see if they get a better shake.

There is a tremendous amount of competition for the attention of Agents and VARs. That means that there will be price competition, commission shopping, and other things that the providers do not want to have to deal with right now.

The only providers who can afford to be exclusive right now are vertical cloud providers and cablecos - both have an almost exclusive product to offer.

Everyone else is selling the same stuff - MPLS, SIP, backup, managed network security, blah, blah, blah. That means the Channel can shop around. And as you can see from the ecosystem diagram, there are a lot of places to shop - VAD, Microsoft, Google, Amazon, ILEC, CLEC, Cableco, MSP, Rackspace, Web hosts, Parallels, ITSP's, and so much more. And Agents can just partner up with a VAR or MSP to sell their own services, leaving the CLEC's out to dry.

It's a matter of control. Do you want to build yourself a business with white-label partners (like VAR Dynamics) or do you want to trust that the telco that is having trouble delivering telecom services reliably will be able to provide you and your customers with unparallelled service delivery of cloud services?

We'll see. In the mean time, be nicer to the Agents. They may be all you have left.

What Else Are You Going to Sell?

2012-03-04T23:44:40Z

TDM is running out of runway. Agents have already switched to selling Ethernet, MPLS and SIP Trunking. What else can they be selling?

Back-up, like Conferencing, is a cash cow that Agents just don't sell. From archiving email per federal regulations to backing up laptops, smartphones, databases, customer records, billing and more "in the Cloud", online backup service isn't much different from Google (see Chrome ad) or Apple iCloud. Access to everything you need through an authorized device attached to the Internet is the beauty to Cloud services, but backing up data is vital to business continuity. How long can a business run without billing records or a customer database? Not very long. Think how flummoxed you are when you lose your contacts in your smartphone. Imagine that contact list was your business. That's why backup is important (to your customers). VAR's are already selling different versions of online backup: their own; a white-label from Remote Backup, DriveHQ or LiveDrive; and a resell of Carbonite (who is hugging Agents right now) or Intronis (who loves the Channel) or Anxient or many others. There are some like SugarSync or Mozy that backup your smartphone and your laptop to the same account.

Managed Security - most of the CLEC's (XO, EarthLink, Netwolves, Integra, Cbeyond), the RBOCs and the ILEC's (Windstream and CenturyLink) offer some type of security offering, usually Managed Firewall, IDS (Intrusion Detection Service) and Network Monitoring. As more data moves to the web (Cloud), security will become even more significant, in the form of email and application security, encryption, event and log management, and mobile device management. For example, Reflexion provides hosted email security, archiving and encryption services exclusively through the channel.

Hosting and email services - everyone has a website or blog; everyone has email. Why shouldn't you be offering those services too? XO started out as Concentric Network, a hosting company. This was Cloud before it was called that. XO sells Hosted Exchange and website hosting. Megapath just rolled out the Microsoft suite. Intercall offers Live365. It isn't big dollars, but it is a place to get your feet wet in Cloud and apps.

Managed IT - remote monitoring of servers and desktops - is a VAR service powered by software like Autotask, Connectwise, Kaseya and GFI MAX. As businesses are essentially dependent upon computers and technology to do business, managed IT services become an option when skilled technical support staff are too expensive, churned or unavailable.

A step past, Managed IT is the remote desktop - aka Desktop-as-a-service (a term I dislike) and VDI (virtual desktop infrastructure). In 1999, Wyse terminals were going to replace desktops for efficiency. It didn't happen (except in the POS space.) Now we are trying it again. MSP's offer this service - with a big fat helping of bandwidth. There are big names in this space, including Citrix, VMware, and Microsoft. There are also a number of providers, like IIS Group, who provide VDI through the channel. Navisite, which TWC owns, just chose Desktone as its DaaS partner.

Next to DaaS is HaaS, or Hardware as a Service. Don't ask me how this is different or how it isn't just leasing. Ask Chartec.

There are issues with selling cloud services - like the service provider's (SP's) financial position; redundancy and resiliency of the SP's architecture; SP's ability to scale in terms of on-boarding new customers properly and scaling tech support for end users; the end users' experiences as cloud services will change some business environmental factors; and licensing issues.

That being said, Agents should be surveying their current customers about the needs outlined here. Why? To get a bigger share of the customer's wallet.

Another way to look at it is: the customer is going to shop these services like he shops T1's, broadband, and voice. He might as well pay you to shop them for him, like he does for the telecom stuff. Get in there!

If you liked this, you might like this blog post too:

What about selling Cloud

One addition, I interviewed VAR Dynamics (local boys from Tampa) at ITEXPO. VAR Dynamics is a private-label Software-as-a-Service (SaaS) and Cloud business apps provider selling exclusively through channels. Apps include Microsoft Exchange, Microsoft Dynamics CRM, Microsoft SharePoint, Zimbra, BlackBerry BES, email encryption, email archiving and more. There will be cross-over in what a provider sells. Just as VAR Dynamics sells the Microsoft software and email security, CLEC's that you are already familiar with - like XO and Cbeyond - offer a variety of services to sell deep into your customers.

Telecom Tidbits on Presidents Day

2012-02-20T19:22:10Z

On a LinkedIn group we are discussing SLA (service level agreements) and how they do not represent uptime. If you need uptime, you need redundancy. You need to build a resilient network. Netwolves has a solution called Bonded Broadband. "NetWolves consolidates the best carriers through their Bonded Broadband product by combining four circuits of diverse types from different carriers. It supports DSL, Cable, Fixed Wireless and VSAT (and even a T-1, etc.) simultaneously. It will to operate, though at lower speed, even when it loses one of the underlying circuits. It provides a level of high availability with diversity that is unique and valuable. Bonded Broadband always includes 1 static IP for the virtual circuit."

Conferencing is a different kind of sale. It's good that InterCall has added some scripting into their FAQ. By that I mean, by provided answers to questions that come up in sales meetings, like "The majority of our meetings are audio only, how can Unified Meeting add value to those meetings?" More companies should do that.

Aastra IP phones are not widely supported by Broadsoft based VoIP providers. Aastra gets a lift since Metaswitch based EarthLink selected 6700i SIP phones for EarthLink Complete™ (hosted VoIP service).

Analysts are raving about Rogers Communications in Canada launching One Number by utilizing Counterpath's Bria softphone. Now the customer has one number on any platform - PC, Mac, mobile, etc. Rogers mentions IMS, that long ago over-hyped architecture that was supposed to solve the telecom world's many problems, as the underlying network piece. The other is the Bria software, which presents an almost Google Voice like service. "Rogers, however, isn't simply re-branding the Bria Android and iPhone clients. It's doing something far more sophisticated. It's using the underlying Bria technology to power a web-based portal that can make and receive phone calls and send text messages to any Canadian number as well as video chat with other Rogers One Number users - all at no charge and with no penalty to a customer's voice minute or SMS caps," writes GigaOM. Jon Arnold has a good look at the service on his blog too, including a post about the beta launch.

AT&T partnered with VMware to launch AT&T's "Virtual Private Cloud". I have a blog coming up about telcos and Cloud. Watch for it this week.

New to the American market but not new to the global telecom industry, One Access

They make CPE for CLEC on multi-access platforms.

Looking for a white-label VoIP company? Flat Planet Phone Company is looking for a few select partners that want to own a VoIP business and the healthy (40%) margins that come with it.

I get press releases because PR folks like to make me annoyed daily. What really gets me is how many make outrageous claims like free calls and no more cell charges: "Zipring works with every phone and turns any smartphone into a free or cheap calling phone. It supports all SIP-enabled devices and does not handcuff users to Zipring software. It also turns any iPod Touch into a smart phone."

Carbonite has some cool new ads to sell online backup [from Adweek]

XO Communications Inc. launched a three-year strategic plan in 2012 that involves streamlining its product offering, including eliminating most TDM services.

The FCC has a lot on its plate and wants to close some dockets. FCC's Genachowski Tells Congress He Will Consider Closing Title II Docket, which proposed to reclassify Internet access service as a telecommunications service subject common carrier regulations.

I emailed my list this post from L3 this morning. How Kodak is just like POTS.

11 Top Stories in Telecom in 2011

2011-12-15T17:41:31Z

Here's my take on the Top 11 stories in telecom of 2011.

1. Shane McNamara being named VP of the Indirect Channel at XO. It was a shock pick for many in the industry.

2. TNCI Bankruptcy! I understand that the reseller model has been taking a huge beating in the last 3 years, but when you start off hawking "Agent Equity", you need to be better fudiciary stewarts than this.

3. WIND-PAETEC merger - I just didn't see that one coming. It did prove my point about the difference in running a private company as opposed to a public one, who is a slave to Wall Street.

4. Qwest getting bought by CenturyLink - and then CL buying Savvis. It was a big shopping spree. I thought it would have been wiser to buy a cell company, but CL is going all-in on the Cloud.

5. The TCA's Certification program. This is kind of self-promoting because I am a Board member and founder of TCA, but I have seen how the carriers are looking at certification for the indirect channel. I think for agents the CTP (or some certification) will be necessary.

6. The Cloud M&A - there was so much of it! The big one was VZ buying Terremark, which might have been the same plan that CenturyLink used when scooping up Qwest CyberCenters and Savvis. I think the one least spoken about is the TWC-Navisite deal.

7. InterNAP killing its Channel. I don't think this story is over, since the agents have to keep fighting this one or risk more crap like this from carriers who need to rightside their balance sheet like some kind of lipstick on a pig. Cloud companies don't want to see it, but it is this action by InterNAP (and Equinix with Switch & Data before it) that keeps Agents from running to the Cloud. Fear of being cut off at the knees. Not that telcos - remember MCI? - haven't sliced the channel (hello RBOCs!)

8. TelePacific's buying spree - Telekenex, Tel-West, Covad Wireless, and Orange County Internet Xchange. It was fast and furious and quick.

9. Dan Foster leaving then returning to MegaPath to take over for Bruce Chatterly as President of the Business Markets Group. That game of musical chairs was confusing to watch, coming on the heels of the merger of Covad's two largest customers - Megapath and Speakeasy - into one company.

10. Since 2011 seemed like the year of serial acquisitions from companies - Megapath, TelePacific, CenturyLink, Windstream, TDS - let's give a hand to EarthLink, who took New Edge Networks and combined it with One Comm., DeltaCom, and STS Telecom to make a nationwide business CLEC play, then added a bunch of IT/Managed services/Cloud services to that CLEC with Logical Solutions, Business Vitals and the Synergy Global Solutions deals. We'll see how that integration works out in 2012.

11. Comcast hiring Craig Schlagbaum to build and run its Channel indicated that Cable was coming to play in the business space. CLEC's need to take note, because most CLEC"s don't OWN or operate their own network, but lease network from ILEC's and Cablecos. Also, Cox and Comcast are rolling out Hosted PBX nationwide, which means the ITSP space better wake up and get its house in order, since cable has a brand and a network to go with that Hosted PBX service.

I'm certain we will see more M&A in 2012 since companies are flush with cash and can't organically increase revenue. And I am also certain that Cable will be making a big impact in the SMB space in 2012, much to the detriment of CLEC's and VoIP providers.

Frontier Gets Cell Service, Agents Should Too

2011-11-18T18:23:01Z

Frontier Communications has inked a deal to be a channel sales agent for AT&T for voice and data cellular plans, as reported by the Fool. "This was a natural extension of a product that we are not currently offering that would fit well with our product suite," Steve Crosby, Frontier's senior vice president of government affairs and public relations. At least they realize that cellular is an important part of the total telecom send. Do you?

When master agent,TBI, launched its SAAS-based TEM platform, Geoff Yearack, director of TBI's wireless division, stated that it was a way to aid agents with getting some of the wireless spend of clients.

Agents have to start looking at ways to get more of the telecom wallet as that budget is absorbed into the IT budget. The simple approach is to offer TEM to your clients. Another approach is to offer asset management. To tie into cyber-security , laptops, data cards, mi-fi gadgets, tablets and smartphones not only need to be tracked by businesses but secured against data theft and loss.

Cbeyond, XO, TelePacific and other CLEC's are offering cellular plans in conjunction with Dynamic T1 and other services. With the average T1 price at an all time low, it's one way to increase ARPU or MRR -- and in turn, increase commissions.

Sprint recently raised $4B in a debt offering in order to pay for network upgrades for "iPhone and its Network Vision network modernization plan". Rumor is that some of it will be used for Clearwire build-out, which seems likely given that Clearwire has some of Sprint's spectrum and has been Sprint's 4G partner. How do you hang that up now? But it goes to show that even after the billions already spent by the the cellcos - VZW, ATT, Sprint, Clearwire, and even MetroPCS - billions more will have to be spent to -- not buy more spectrum -- but to just deploy the spectrum they are currently sitting on, for tower backhaul and for network management. Big pie there that Agents need to take a piece of.

So Who is Going to Buy XO?

2011-11-03T18:11:22Z

I got asked this question again today: Who is going to buy XO? I think we can almost all agree that Carl Icahn would like to sell his company.

XO had 2010 revenue of $1.5 billion, only $8 million more than 2009. So that's flat. XO just laid off 400 employees - probably to make the numbers look better.

Who would buy them?

WIND just received approval to acquire PAETEC, so that takes 2 names out of the running.

Level3 didn't win Paetec and just grabbed Global Crossing, but I could see L3 making a pitch to Icahn, because it would be revenue for L3 and a good portion of it is VoIP revenue. However, integration would be a flashback to the 2006-2008 era. Plus while revenue is up for L3 this past quarter, losses also increased. OUCH! [Plus as I have mentioned before L3 needs to take Cogent off the table, since that is their main competitor in the IP space.]

CenturyLink just swallowed Qwest and Savvis. That plate is full, plus I think focus at C-Link is Cloud not TDM/network.

EarthLink has just purchased 3 MSP's, following more in the PAETEC play book than any other. EarthLink acquired IT Solution Center and Hosted Application Business from Synergy Global Solutions. ELNK has completed the acquisition of xDefenders, a managed IT security company based in Rochester, NY, to "Enhances National Managed Services Provider Strategy". And ELNK "completed its acquisition of Business Vitals, a national provider of managed information technology (IT), security and professional services based in Columbia, South Carolina." They also bought LogicalSolutions.net. That's 4 quickies on the heels of STS Telecom, Deltacom and ONE Comm. Just it looks like the play book centers around MSLEC, the strategy that MegaPath re-branded under. Do they have room in the fold for XO? Probably. And ELNK has an easy time getting credit.

[BTW, have you seen the new ELNK website? It looks great! Seems like wordpress with its clean template design. It includes video testimonial!]

Zayo just surprised many folks by buying 360. I thought it would be the other way around, but I'm wrong often. (Well at least 20% of the time according to Dane!) Is there enough VC dough to get XO? (Or will I have that reversed as well?)

Broadview Networks, TelePacific, Broadvox and Integra aren't candidates, but who knows what private equity money is thinking.

Frontier and Fairport have not moved to cloud yet. They both have indigestion from eating up Verizon assets. Maybe one of them will pop some TUMS and give Icahn a bid.

Cox and Comcast - do the cable guys want to buy some VoIP and fiber?

Some outliers:

I remember being surprised when Host.Net bought WV Fiber, so it could happen again. Not likely with its strict focus on data center and cloud services.

A foreign company looking for network - like Tinet, Telefonica, Tata, Reliance (which bought Yipes in 2007), Orange telecom. I would have listed T-Systems, but with DT still wondering what is happening with T-Mobile, that seems unlikely - or if AT&T pays T-Mobile its break-up fee of $3-6 billion, they could buy XO with that!

Ethernet is Spreading

2011-07-18T15:59:55Z

So many notices this week about Ethernet. It's the preferred protocol for most businesses. (No one wants to buy a DS3 card and configure it, I guess). Ethernet is becoming more and more available as the delivery protocol for Internet bandwidth, MPLS, IP/VPN, and Private Line.

The M&A targets are all fiber guys like FiberLight, AboveNet, Zayo, Sidera, Fibertower, Fibertech and XO. All are Ethernet players.

AT&T announced that come August 1st it is almost doubling the Metro Ethernet rates in the 9-state BLS region. What a bonus for customers.

Sprint launched Ethernet access in 25 new markets and expanded offerings in five existing markets. Ethernet is available for MPLS and IP products. Sprint finally leveraging their pin-drop network. [Don't want to play with Sprint directly, TNCI resells Sprint.]

FiberLight released a new IP network architecture based on Ethernet for governemnet and enterprise customers. Juniper and IBM are technology partners in this new IP platform.

In a similar fasion, Comcast and Ciena went on the road to train salespeople on how to sell Comcast Metro E. "Ciena's Carrier Ethernet Service Delivery (CESD) platforms are being deployed by Comcast as customer premise equipment for business services and wireless backhaul."

Media reports that wireless backhaul is a huge market - and it is slowly migrating to Ethernet. I think physics determines that wireless tower backhaul is a finite market - - you can only get so many bits into X amount of spectrum, no matter how many radios you use. So with everyone spouting off about backhaul opportunities, I don't know how many players will actually make a huge dent in revenue from it. I have seen figures that VZW pays less than $1000 per tower backhaul. That would take a lot of towers to move the revenue meter. And let's not forget that it is a competitive market -- RFQ and bidding war anyone? Especially after you told Wall Street how much the backhaul market would bring in. DUH!

In other Ethernet news in July that affects the Channel:

Netwolves announced that they can put multiple Ethernet providers with managed services on 1 invoice. NetWolves has relationships with over 50 different providers that sell Ethernet services. This allows us to find the provider that is best suited to deliver the service for you. We also have the ability to bundle multiple Ethernet providers onto a single bill for your customers.

Also, Airespring uses the lowest cost provider per area to build an inter-connected MPLS network. (Can you say NNI?)

NITEL is another carrier that can help Agents expand their product offering to with nationwide MPLS, Ethernet, dedicated Internet (DIA) and private line services.

EarthLink Business has nationwide MPLS, formerly sold under the New Edge brand. Since adding Deltacom, Ethernet should be available extensively in the Southeast.

All this Ethernet talk makes me think of the numerous Carrier Ethernet Exchanges that have evolved - from TELX and Equinix to Neutral Tandem and CENX. It's a lot of spots popping up to inter-connect using Ethernet. Basically, it's a meet-me-room with carrier ethernet switching gear (usually from Cisco) that allows the exchange of traffic at 100MB or higher. It is a cost-effective way to pay for peering (sort of), as you exchange traffic of HD voice, video, SAAS, mobile data, CDN and tele-presence packets. Carrier Ethernet Exchanges mean Ethernet sales and in many cases collocation sales for agents.

US Signal deploys Cisco ASR 9000 Series for enhanced Carrier Ethernet and a new managed Data Center service. The ASR will allow US Signal, a TCA vendor member, to scale its Ethernet offerings in the Midwest. "US Signal Managed Data Center service is built with dedicated resource pools designed to rapidly provision and host Virtual Private Servers accessible through the upgraded US Signal IP NGN." So we go from Ethernet to Cloud just like that.

XO Comments on L3-GC but not T-T

2011-07-13T19:20:57Z

XO Communications filed comments with the FCC that some media outlets said ripped the merger of Level3 and Global Crossing. Rodrego A. Byerly tweeted that it smacked of a spurned suitor. Maybe it was. XO issued a statement that the L3-GC merger was not in the public interest.

When I saw the tweet from @XOComm, I asked if they had filed comments against the AT&T-T-Mobile merger. The reply: We did not.

HUH? How can you say a merger of 2 of the 10 Tier 1 ISP's in the US (VZ, ATT, Qwest/C-Link/Savvis, XO, Cogent, NTT, Level3, Sprint, Global Crossing, Comcast) will affect public interest, but that the merger of 2 of the Top 4 cellcos isn't? Except that it doesn't really affect XO's business, since they aren't in the cell business, but are in the ISP backbone business. Just plain interesting.

I ripped on Sprint since Dan Hesse is everywhere jawing about the cellco merger, but no one is minding the Sprint store of fixing its own troubles to better compete, especially during the integration. (And get back to branding the wireline business you have. Sprintlink DIA is awesome!)

I'll rip on XO here for a similar reason. Carl Icahn has spent so much time and money playing Board politics that the XO boat has been sitting idle in the harbor. Icahn just won the ability to buy the last of the outstanding stock so maybe he will poo-or-get-off-the-pot at this stage. Meaning: sell it or invest in it. The employees and the marketplace distrust uncertainty. That would be more effective defense against a hyper-competitive backbone marketplace than a PR blitz against the merger.

SIP Trunking Deployment Lessons by XO

2011-07-13T18:57:27Z

XO has hired Ronan Keenan to handle their corporate social media, like the @XOComm twitter account. They put together quite the resource for SIP Trunking Deployment at Storify: SIP trunking implementation resources including videos, presentations and documents by Steve Carter, who is the SIP Product Manager at XO.

He narrates a detailed video about SIP Trunking: Learn the Steps to a Smooth Enterprise SIP Trunk Implementation. Good info for Agents to use to learn on their own at their own pace.

XO Has a New Channel Chief

2011-06-27T18:25:41Z

XO has announced that the new Channel Head at XO is Shane McNamara. Shane spent time in the channel at Global Crossing and recently headed up the carrier services department (agency) at CDW. Shane replaces Brian Law, who left XO due to a renewed entrereneurial spirit.

From the official announcement from XO's CMO, Mike Toplisek: "Today I'm pleased to announce the new leader for the XO Business Partner program and our indirect sales efforts. Shane McNamara will join XO Communications as vice president of indirect sales, reporting to directly to me.

Shane joins us from CDW, a major reseller of computer hardware, software and supplies from companies such as Cisco, IBM and Microsoft. As general manager of carrier services for CDW, he lead the company’s indirect sales to carriers and service providers and successfully grew its indirect channel sales business by more than 40 percent over the last three years. Prior to that, he was director of sales and marketing for Global Crossing's indirect channel, where he helped build and grow its channel business, which delivered more than 50 percent revenue growth while he was in this role. Before that, he held various account management and sales roles in both the direct and indirect channel at Global Crossing.

With more than 14 years of sales experience in the telecommunications industry, Shane is a seasoned indirect channel sales leader and known entity among our valuable partners in the indirect channel in the telecommunications industry. Shane brings both a deep knowledge of the industry and key relationships and will be a great addition to our sales leadership team.