Skip to main content

Posts

Showing posts from July, 2017

Data Breaches So Far

We’re halfway through 2017 and, according to Lookout’s Breach Report data, there have been a total of 89 major beaches that have exposed over 1.7 billion total accounts or records, according to Lookout Breach Report data.

  Financial and “personally identifiable” information top the list of stolen data types. This includes email addresses (39% of breaches), financial information (31% of breaches), Social Security Numbers (24% of breaches). Read how more people are affected by data breaches than the flu.

Everyone is For Sale For the Right Price

We hear that often, especially in the UC/VoIP space. However, the "Right Price" that many owners have in mind is far removed from the reality of the sector.

Mitel bought $212M in annual revenue and $145M in cloud revenue for total equity value of $530 million. 2.5x Revenue.

8x8 is rumored to be looking for 6x revenue.

Market caps of stand-alone UCaaS players is running 6x revenue, while Windstream's market cap is just one-sixth of revenue. No Rhyme or Reason to it.

Rumor has it that Nextiva is cleaning itself up for sale. At $150M in revenue, how much would that fetch? People forget that the value is determined by the Buyer, not the Seller. A couple of UCaaS players were waiting out better offers, when they chose to take the prevailing offer, which was less than the Dream Price Tag.

To say that everyone is for sale says a lot about the industry too. No one is in it for the long haul. Why? They have already been at it a while and the success is meager and the grind is…

Finally Some UC M&A

MITEL has been hoping that M&A would help its position as a global leader in UCaaS. They have been shouting about 3 million seats, but still can't garner the press that Vonage, 8x8 and RingCentral do. Even Fuze gets a bunch of press as its plays musical chairs.

MITEL has a vision to consolidate and accelerate to the cloud (see prezo deck slide 5)

Mitel is acquiring ShoreTel in an all-cash transaction at a price of $7.50 per share, or total equity value of $530 million and a total enterprise value of $430 million. This represents a 28% premium over the Shoretel stock price.

With Shoretel, MITEL adds 271,000 cloud seats; Combined revenues of approx $1.3 billion; and Recurring cloud revenues of approximately $263 million. This leaves Mitel with $689M in debt.

While Mitel talks about 3 million cloud seats, a majority of those are non-recurring. (In other words no recurring revenue!) Only 588,000 of the 3.2 million are recurring.



I added some color to Mitel's slide. Vonage…

20+ Hosted VoIP/UC Providers

We all know about the Top Hosted VoIP/UCaaS Players. This is the 2017 IHS UCaaS Scorecard:

Vonage, 8x8, RC, Fuze, West, Verizon, Nextiva, Shoretel, Mitel and Jive. Add in Comcast and Cox.
The twist is Star2Star, Netfortis (now owns Fonality), Windstream and Coredial. Star2Star is more a premise play with SIP Trunks than actual UC seats. Netfortis is Genband powered since the name change from Telekenex and their purchase of Fonality was a head scratcher. Coredial is a white label provider with both a Broadsoft and an Asterisk platform. Windstream sells Mitel, Avaya, Shoretel, Allworx (it owns), Broadsoft and Broadview which it recently acquired.

There are 2000+ Hosted VoIP/UCaaS Providers in the US. More than makes any list or report (like IHS). Most of these companies are marketing challenged.  Others think buying an award will be enough noise.  Here are a selection:

Broadsoft:
TPX (formerly TelePacific + DSCI); Evolve IP;AT&T; CenturyLink;MegaPath; Birch; Bullseye; Broadsmart (…

A Look at the Consolidation Wave

There is a lot of consolidation going on in telecom, but it is centered around fiber and data centers. Why? These are assets that can be financed and monetized with a long shelf life. They can be stuffed into a REIT. (Some REITs you may know include: Uniti Fiber, QTS, Digital Realty)

(How long is the fiber shelf life? Look here.)

But where is the consolidation in Hosted VoIP? With baited breath, we wait for the market to start consolidating.  It just isn't happening. The last deal was Broadview being acquired by Windstream in April. Nothing substantial since.  (there were a couple of really small deals).

One reason is that moving customers from one platform to another is a PITA (pain in the asset). Even migrating from a Broadsoft to another one can be difficult when the versions are dissimilar. What breaks at the customer end features and function wise during this process? It is labor intensive.

The last rumored deal was Oracle trying to buy 8x8. 8x8 has a market cap of $1.3B, on…

Telecom Tidbits #2462

Endpoint management by Phonism now supports Avaya Open Standards as well as Cisco, Yealink and Polycom. Is Zayo next for Crown Castle? Crown Castle is a REIT that owns lot sof cell towers. It has also gone after fiber assets by acquiring Wilcon, Sunesys, FPL and now Lightower for $7.1 Billion. One executive thinks there will be more consolidation in Hosted VoIP. I think there will be smaller deals, but big deals are just too ridiculously priced. 8x8 wanting 6x revenue is just stupid talk. In an interview XO's CMO, Jake Heinz, mentions that XO was jus about at $2 billion in revenue. VZ acquired XO from Icahn for $1.8B. What kind of valuation is that? On a similar note, " Seeking Alpha, commenting on the spinoff of assets to Frontier for $10 billion, said, “Of course the cash influx is nice, but it also comes with a diminished earnings power, effectively trading long-term cash flows for short-term cash flows. These assets were worth $0.10 a share in earnings. In the first qu…

The Problem With Most Webinars

Channel partners are invited to so many webinars - from master agencies and service providers. We could spend all month on webinars and at events (but that won't pay the bills). I am often asked, why don't more folks get on our webinars. Well, here's some ideas.

Bad webinars come down to 3 things: Topic, speaker, content.

Topic: the title has to grab people by the throat. It is the Attention Grabber. A/B testing is a smart idea.

The Speaker: They need to practice. Being unprepared means that you didn't value our time. Don't let a technical difficulty with the slides mean you are thrown off. It happens often. Speak without reading me the slides!!!!

The Content: It is more than just the slides. It is about what message you are trying to convey. What would excite your audience. It is about the PARTNERS, not your boss, you company or YOU. All too often, the deck is jam packed with more info than can be puked out in the allotted time. That is disrespectful. It also sho…

On RAD's Radar: the CEO of LANtelligence

LANtelligence CEO, Marty Tracey, did both an interview with me and a podcast. We discuss the changes facing the channel as well as Cloud Contact Center as a Service.

 LANtelligence comes to the space after morphing from a PBX systems integrator. Today, they design, implement and support UCaaS, CCCaaS and other cloud comms for businesses of all sizes in the USA and Canada. Partners are welcome to work with them as we discuss in the podcast below.


The Interview with LANtelligence CEO, Marty Tracey.

 Here is the podcast with him:



The podcast is at Soundcloud.

From Channel Manager to Agent: A Candid Conversation

Yesterday I had a personal, authentic and candid conversation with Amanda England, who is now a Partner Development Manager at BCM One. We discussed what it's like to be an Agent and how that differs from being a Channel Manager. Great insight and some gems of knowledge in this podcast. Take a Listen at SoundCloud.

If you liked that podcast, here are two more podcasts with advice for agents - HERE and HERE.

Why Do We Have a Channel?

Why is there an indirect sales channel? One reason: We are far more responsive to our customers. Another case in point today. The carrier wouldn't let me sell the upgrade due to ROE (rules of engagement). A month later, client still hasn't heard from his account rep. No upgrade. No new revenue for carrier. Dissatisfied client.

Telecom Tidbits # 2461

Some bits of news from around the industry.

Not a good week last week for Birch: They had an all day outage at 56 Marietta that signaled they are hosted not cloud (no redundancy to speak of). Then they had to pay a $6M fine to settle an FCC billing and marketing investigation.

Sandvine will be acquired by PE Firm, Francisco Partners, and combined with Procera Networks. The sale is roughly $420 million USD. The new company will focus on network intelligence.

In a relatively small merger, Fixed wireless ISP GeoLinks has acquired One Stop VoIP.

Crown Castle made a $7B bid to buy Lightower Fiber Networks.

4 Reasons Why Retailers Love NaaS (Network as a Service, which is an SDN powered service). Retail is really the vertical that is buying the most SD-WAN.

Avaya asked the courts for more time to put a re-org plan in place that most of the debt holders would approve. Avaya is also working on opening up their phones to work with other gear (like maybe Broadsoft).

Channel Management: Four Tip…

Secrets of Channel Management

The paperback version of my book, Secrets of Channel Management, is available now on CreateSpace and on Amazon!

The Kindle version has been available for a while. (Get it here.)

To kick off the second half of 2017, I am presenting Secrets for Channel Managers, a 50 minute webinar for channel managers to get some tips, tricks, reminders and Q&A. This webinar will be August 11th at Noon Eastern time. The cost is just $25 per person. Register Here!

Secrets for Channel Managers (webinar)
Aug. 11, 2017 at Noon ET
Register Here!

I will be doing another webinar on the Hosted VoIP/UCaaS Competitive Landscape. This webinar will examine 20 providers out of the 2000 currently operating in the US. It will provide some context as well as analysis of what the marketplace looks like today. Join me on August 25th at 2 pm ET for this data packed hour. REGISTER NOW! channelplaybook.com

The Competitive Landscape of US Hosted VoIP/UCaaS
Aug. 25, 2017 at 2 pm ET
REGISTER HERE!

Are the Numbers Real?

The RC quote came from an investor presentation.


This second screenshot came from Broadview via a Windstream investor presentation on the acquisition.


Today, there is an article about The Agent Alliance in which it describes them as: "Alliance members collectively have offices in 30 U.S. and international cities, priority access to over 11,000 subagents and direct sales resources, and more than 250,000 existing clients – all resulting in a sales engine that books over $2 million in new revenue per month and manages over $2.1 billion in annual billings."

Where do they get these ridiculous guesses about the number of partners? 200K? 300 masters? 11K?

What happened to reality? And truth in investor filings?

Verizon Re-Orgs

So Verizon re-organized again. They formed Verizon Business Markets in February, 2017, after completing the acquisition of XO. "As part of the [new] reshuffling, Jake Heinz, the former senior vice president of marketing and product for XO Communications, has been named chief marketing officer for Verizon Business Markets," reports CRN. Some folks think Janet Schijns was pushed out, but my understanding was that she wanted the CMO gig. Working at Verizon is not an easy thing as you play more politics than you do in DC. It might just have been time to move on. I wouldn't be surprised if she exits telecom. "Word from Janet is that she has a new role and will announce in two weeks," according to CP. "Joe Chuisano, a 23-year Verizon veteran, is now the North America Verizon Business Markets channel chief reporting to Martin Burvill, senior vice president and group president of Verizon Business Markets. In his new role, Chuisano will lead the indirect chann…