Technology Reseller speaks to Nick Goodenough, Partner Service Manager at Spitfire, about opportunities in voice and data and how Spitfire can help IT resellers make the most of them
The convergence of voice and data has presented IT resellers with a golden opportunity to expand into voice – and most have grabbed it with both hands. Nick Goodenough, Partner Service Manager at independent voice and data solution supplier Spitfire, estimates that currently 90% of IT resellers offer data circuits, with two thirds selling voice.
He argues that the take-up of voice would be even higher were it not for the fact that some resellers pulled back when they found out voice wasn’t just another data application but required a lot of thought and was highly dependent on a quality connection.“This,” he told Technology Reseller, “is where choosing the right supplier makes a big difference.” By which, of course, he means Spitfire.
Spitfire was founded in London in 1988, initially as a telecoms company, selling, installing and maintaining telephone systems for business customers. In the ‘90s and ‘00s, it diversified, adding telephone lines, internet connections and additional voice and data solutions to its product portfolio, including the multiple award winning SIP Communicator hosted PBX.
In 2001, Spitfire supplemented its direct sales business with the establishment of its Partner Service indirect sales channel. Today, it has more than 500 signed-up partners responsible for slightly over half of the company’s £25 million turnover. A growing reseller network, and the opening of a Midlands office in Redditch, Birmingham in 2006, have helped Spitfire to extend its reach nationwide.
Technology Reseller recently caught up with Nick Goodenough to find out more about Spitfire’s offering for IT resellers. Technology Reseller (TR): Nick, please could you tell our readers a little about Spitfire’s Partner Service.
Nick Goodenough (NG): We set up the Partner Service in 2001 and realised almost immediately that there was this real demand from IT resellers for a trusted partner, and by that I mean a company that can help them move into new areas, by giving them the right advice, proper training and, if necessary, sales support – someone to go with them to see customers and engineers who can assist their engineers. That’s what we did from the beginning with the Partner Service.
We’ve got 400 active partners and over 500 signed up partners. Some of them are very small and will give us only very occasional business, but we don’t mind that. We don’t set targets. We know that if we do a good job and help partners to grow their business we’re going to benefit. I think the word partnership is overused, but that is what we offer — we work hand in hand with IT resellers; we’ve got boots on the ground, people who can actually support them in the provision of our products and services.
TR: What services do you provide?
NG: Basically the full range of internet and telecom solutions for SME businesses, everything from a business broadband circuit costing £15 a month to much higher quality broadband circuits designed to carry voice and Ethernet circuits – more expensive but far higher quality internet circuits with colossal amounts of bandwidth, 100Mbps, 1Gbps, 10Gbps, 100Gbps.
What we specialise in is helping partners who’ve got multi-site customers to link those sites together. The traditional way was to put in point-to-point circuits, an expensive private circuit running between site A and site B. We provide much less expensive and simpler ways of doing this using IP Engineering technology called MPLS, whilst also allowing extremely high quality connectivity into the big cloud providers like Amazon AWS, Microsoft 365, Microsoft Azure, Google and so on.
Today, there’s a real move in use of the Internet from it being a very open thing to controlled, quality connectivity between a customer’s sites or between their site and Microsoft 365, say. Consumer internet is all about speed, how fast you can do stuff, but for businesses, it should be all about quality – the quality of the bandwidth and its reliability, so that if it does go down you have proper resilience, with backup circuits and a properly considered Business Continuity plan.
The connectivity bit is key, because this underpins a series of other services, one of which is voice. Anybody can make a call over the internet; the key thing is for the quality of that call to be as good as ISDN and traditional phone lines. We’ve got customers like Arsenal Football Club who still use ISDN for radio broadcasts because it offers perfect quality. If we’re moving a customer from that onto some form of voice over IP, the quality has to be just as good.
Our starting point when providing voice solutions to resellers is a) to ensure the product is good quality, for example by using the right type of internet circuits rather than just putting voice over any old broadband; and b) to train resellers so that they have the benefit of our experience dating back to 1988. Whether they are new to voice or have been doing it for several years, we make sure they understand everything that needs to be done to ensure quality is perfect.
The third key aspect is security. There’s a huge amount of fraud linked to telephony systems, whether they’re cloud or hosted or onsite. Criminals who hack into a system and make calls to premium numbers in countries like Somalia can rack up potentially enormous bills for businesses. Most of the time, this risk can be prevented through good housekeeping, but sometimes an IT reseller will download some wonderful new software PBX, click the features they want and leave doors open that they shouldn’t have. To stop this from happening, we hold regular training courses for partners on voice security.
We don’t charge for these courses and they are hands-on, rather than basic lectures. This applies to all our training. When we train engineers, they have phones and computers in front of them and they are the ones doing the programming rather than us just telling them how to do it. That is fundamentally different to how most vendors do training. It’s more expensive, because you train fewer people at a time, but we think it’s crucial for people to have a proper hands-on understanding of the technology.
TR: Presumably Spitfire’s focus on training extends to its own staff as well.
NG: We recruit all of our account managers and all of our support technicians as graduates and train them up. They do an extraordinary amount of training, starting with an initial three-month training course and then continuing after that. In their first year, our graduates do 500 hours of proper, formal training. On top of that they shadow more senior team members, listen to other people’s calls, go to meetings and the rest. We find that our competitors tend to train people up in a couple of weeks.
Our account managers are all Cisco certified; all have Cisco CCENT and some have a full CCNA and studying beyond. The whole idea is for them to have a fundamental understanding of data and how to route different types of traffic depending upon requirements. This theoretical training is combined with extensive training on applications and the challenges that our partners and customers overcome – moving services into the cloud, connecting different sites or anything IT related. This ties in closely with our IP Engineering solutions, such as QoS and MPLS, which offer properly engineered solutions and real business benefits. We believe that our account managers are the best trained in the industry bar none.
TR: Do most of your resellers have their own engineering capability?
NG: Most of them do, although we have some who don’t. We even have some partners, consultants for example, who don’t sell but just give us referrals. There are so many different variants. We will fit in with whatever it is that our partner wants, rather than forcing them to fit in with our model.
We’re finding that with the move into managed services, IT resellers that traditionally would have had their own engineers, now have many fewer engineers qualified to do things on a customer’s site. We can fill in the gaps for them. By the same token, if we have to do something on-site, there are times when it might make more sense for us to use one of our partner’s engineers, if for example both they and the customer are based in Glasgow. It’s quite a flexible process.
TR: Does this flexibility extend to billing?
NG: Yes, a customer can be billed by us or by the partner. Generally, smaller IT resellers prefer us to do it, while larger ones prefer to do it themselves. A few years ago, maybe 50% of our potential resellers were saying they wanted to bill themselves. But we’ve seen a real swing away from that now. A lot are happy to bill for things like an internet circuit, which is the same rental every month, but don’t want to get involved in billing for voice, because they’re billing minutes and because they are opening themselves up to the risk that if a customer goes bust or is hacked, they have to pay the bill.
TR: Is there a particular type of IT reseller you like to attract?
NG: The best partners of all are those with between five and 50 people. We do have ones that we have worked with for a long time that are larger, sometimes significantly larger. But generally, companies bigger than that are more likely to be able to do in-house what we offer resellers in terms of expertise, support and training.
Ultimately, the sorts of reseller we are looking for are those who have a similar passion to provide the very best solution, rather than just make a quick buck. We’re very lucky at Spitfire; the company is privately owned, we’re profitable, we don’t have any debts and we don’t have external shareholders and venture capitalists clamoring for quick profits. For us, it’s all about proper, sustainable, organic growth, based on long-term relationships with our IT resellers and their customers and with our direct customers.
TR: Do any of your partners worry that you also sell direct?
NG: No, they don’t or at least they shouldn’t! We make it extremely clear that we’re never going to try and poach customers. If we were to do that it would clearly be the end of the relationship. That’s the sort of thing you do if you want to make a short-term buck, which is not the sort of company we are. Almost our entire business is based on recommendations and referrals, whether through our partners or through customers. If we behave in an unethical fashion, that will stop.
TR: What about office software? Do you just provide voice and data solutions or do you sell things like Microsoft 365 as well?
NG: No, we don’t. And that’s primarily because if we were to do that, our partners might think we were trying to encroach on their territory, as the majority of them now provide services like 365. We’ve looked at it and some of our competitors are selling 365, for example, but we don’t think it’s the right thing to be doing at this stage.
TR: I tend to think of Spitfire as a London business. Do you operate nationwide?
NG: In the 1990s we used the advertising strapline ‘London’s local telco’. Rather like COLT (City of London Telecoms), we were very London-centric. One of the benefits of the Partner Service and selling through IT resellers is that it has allowed us to expand outside London. Most of our business now comes from outside London. The reason we opened our office in Redditch, just south of Birmingham, was to have more of a local presence in the Midlands.
Today, we’ve got partners in Scotland, in Northern Ireland, in Devon, in Cornwall, in Wales – they are spread right across the country. There is a larger proportion in the south-east and in the midlands, but our coverage is probably not all that different to the business density across the UK. Having a local presence means we can provide services and support those services nationwide – it’s because of our IT resellers that we are able to do that.
TR: What plans does Spitfire have for 2017?
NG: The big thing for us this year are Ethernet circuits – internet circuits that provide very high quality bandwidth and very large amounts of bandwidth. They cost from around £150 right up to £1,000 a month. We have traditionally only used BT Wholesale, but we are now providing Virgin, COLT and TalkTalk Business circuits as well. This means that we can install circuits far faster and at lower prices compared to using BT alone, giving our partners the best choice of circuits around.
The other service we are expecting to grow significantly is Cloud Connect, which provides high quality connectivity to the likes of Microsoft Azure, 365 and AWS (Amazon Web Services).
Those are the really big things for 2017, but quite a lot else is happening. For example, our 3CX cloud telephony product is being significantly enhanced, and we’re really stepping up training for that, based on partner demand.
The other thing that our partners have asked us to do is raise our visibility, so we’re putting more money into brand awareness. We’ve historically advertised on Heart FM, and we’re now advertising on Smooth and Classic FM; we’ve got 55 taxis driving round London with Spitfire branding; and we’ve got adverts at key railway stations.
On top of that, we are continuously enhancing our core network so that we keep up with the increased bandwidth requirements of customers and can provide exceptionally high availability for those customers who can’t afford to be down.
TR: And for resellers, what are the big trends that might make them look at voice and data?
NG: The big trend in data is still the cloud. It’s amazing how many small and medium sized businesses still use on-site servers; there’s a big opportunity for resellers in moving them to high quality cloud-based services.
Another big opportunity is legacy voice. There are still something like 3 million ISDN channels in the UK. ISDN is so expensive compared to using SIP trunks – getting on for four times the cost – that customers who have legacy phone systems sitting on ISDN are going to be moved to VoIP by someone. If the reseller doesn’t do it then a) they’ve lost potential business; and b) the company that does do it has a foot in the door to sell them other IT services. We’re seeing some more traditional, voice-type companies moving into the data market and I think IT resellers need to wake up to that and take on voice. If they stick their heads in the sand and think ‘I don’t want to deal with that’, they run the risk of losing customers.
The other thing is the roll out of fibre. One of the main reasons we’ve partnered with Virgin Media Business is because they are investing literally billions in rolling out fibre across the UK. There are so many locations – and I don’t just mean rural locations, but locations bang in the centre of cities – that have poor quality connectivity. That this is now being addressed is really exciting because it enables customers who previously had poor connectivity to move to the cloud, to cloud telephony and SIP trunks and all the rest. That’s a big thing – and a big opportunity.