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Talking Unified Communications

It’s boom time for unified communications. Everyone seems to be piling into the market and urging resellers to do the same. Or is that just a perception – or misconception? What is the true picture of the current market? Are there too many providers – and does it matter if there are? How can resellers maintain their margins when customers are being offered so much choice? We ask industry experts for their thoughts on the burgeoning UC scene

Technology Reseller: Are there currently too many Unified Communications providers and why might this be a problem for the channel?

Paul Taylor, Sales Director, Voiceflex: There’s a great deal of segmentation within the channel. With a PABX connected to ISDN/PSTN, we had rules and regulations, with 99% of applications connected directly to BT. Now, there are far fewer regulations, which means a more fragmented market.

Channel partners are now service providers with their own hosted applications servicing their end users – Voiceflex itself is SIP carrier to many channel partners’ hosted applications.

Of course, this brings more fragmentation, with white labelling raising the question of whether the partner or a hosted provider is providing the core and a SIP carrier providing the breakout service? Then, there are hosted providers offering telephone applications in the cloud. Are they single instance? Do they have a session board controller (SBC)? Are they multi-tenanted? Is failover provided?

There is a lot of smoke and mirrors. The problem is most channel partners are told by hosted providers that ‘it’s hosted in the cloud’. Yet, not all applications are the same and the channel partner often doesn’t have the experience to know what to ask, until the first couple of applications are installed. Then the questions start.

John McKindland, Head of Solution Sales, Nimans: There’s lots of choice in the market, which has its good and bad points. Choice and competition are undoubtedly good for a reseller, but picking the right supplier is key. You need to choose one that can provide most, if not all, of your product requirements. Someone much like ourselves.

With a vast product portfolio, we can supply everything you need. Whether that’s an IP end point, headset or collaborative software on a PABX, we can supply it all. This brings continuity of supply and continuity of relationship, which makes us easier to work with. Resellers deal with one Account Manager and one field-based resource who understand their business. It’s not just about product supply, but the back-end services they can take advantage of.

There is confusion in the market, which we can help demystify. If a reseller uses supplier X for one product and supplier Y for another, they lose the ability to have end-to-end technical support and continuity with customer-facing support. Obviously, cost is an important issue but being able to negotiate means they don’t need to shop around. Good service counts.

Dave Reynolds
Dave Reynolds

Dave Reynolds, UK Managing Director, Xelion: Whilst there are several suppliers of UC hosted telephony platforms, suppliers may have very little control over the platform that they supply to resellers, as they also ‘white-label’, reselling the service themselves in their own brand. We would advise all resellers to understand who the underlying developer behind a service is, how flexible they are when it comes to partner feedback and who makes the final decisions on both the road map and final product.

First generation UC hosted voice services provide a very closed environment where they and not the reseller have the control and dictate the end product. The most customisation the majority offer is to put a logo in the corner of a portal. As hosted voice adoption has increased, so has the skill set of the resellers. We believe that both large and small resellers yearn for more control and flexibility to deliver a service they want to sell.

That is why Xelion has an open architecture that puts the comms provider back in control, allowing them to build their own comprehensive comms proposition with the flexibility to set their own path and destiny, something no other hosted voice vendor is trying to achieve with the channel.

Jeff Blackey, VP, UCaaS Solutions Marketing, PGi: There are certainly a lot of Unified Communications providers, which makes for a very fragmented market; whether there are too many depends on both perspective and objectives.

A big challenge in the market, and specifically the channel, is how to differentiate one offering from another. With a large number of providers already in the space, what is different about your offering versus every other one? Customers aren’t going to evaluate more than one hundred different providers, so how do you get noticed and become part of the consideration set?

Nick Wright, Commercial Manager, Westcon Avaya: It’s a lively and fastmoving market, with the new ‘born in the cloud’ vendors helping to shape its direction and deliver more customer choice. There is plenty of innovation and many opportunities for partners, especially with the cloud evolutions from traditional vendors delivering a huge refresh opportunity. There are solutions for every scenario and budget, and with current growth rates I’m not convinced we’re at an inflection point of excess supply.

Gareth Long
Gareth Long

Gareth Long, Head of Hosted Voice Programme, Daisy Wholesale: Unified Communications is a Channel buzzword at the moment, so it is no surprise that partners have so many providers to choose from. Although I don’t think there are too many UC providers, I do see many Channel partners struggling with the wide array of features and applications out there. This is making it difficult for resellers to find a single provider that will meet all their customers’ needs.

Many resellers are entering into multivendor relationships, meaning they have to endure all the complexities that come with that, including multiple contracts, prices, billing arrangements, helpdesks and sales teams. This unnecessarily complicates a solution that is designed to simplify and streamline business communications. By choosing a provider with a comprehensive UC solution, resellers can work more efficiently to secure more business, spending less time dealing with the hassle of multi-vendor strategies.

Mike Adams, Channel Manager, Zoom: There are many UC vendors in the market, and the issue for the channel is there is also a lot of confusion as to which solution to recommend and sell. To become a trusted advisor to customers, channel partners need to understand the differences and nuances of each solution. In reality, many UC solutions are quite similar to each other and offer lots of overlapping features, so resellers are often unclear about the

Mike Adams
Mike Adams

true benefits of one solution over the other, and will usually recommend solutions based on their margin potential and relationships with vendors, rather than the benefits to the end-user.

On the other hand, Zoom has a very unique and differentiated solution, with a superior user experience and customer satisfaction, so Zoom stands above all other UC solutions. Our challenge is to educate the channel about these differences, and to allow them to try it for themselves so they can truly embrace the Zoom experience and understand why customers love it so much. Channel partners are customers too, and they all love Zoom as soon as they try it, so it’s natural for them to want to sell it to their customers.

Paul Clarke, Channel Manager North UK, 3CX: The issue is not necessarily that there are too many providers. It’s more a matter of too much ambiguity about what UC solutions include/don’t include, what is classed as an add-on with extra cost, and pricing structures. There is more transparency needed, especially for UC, which encompasses so many different facets of communication. Many vendors develop products that defeat the whole purpose of unified communications by segregating features onto multiple platforms, which of course makes complete systems more costly and more complicated to run.

Resellers need a product that can cater to all types of business customer, whether it be on-premise or in the cloud, for 2,000 users or 20. It needs the manageability and power to perform at all levels and the features to satisfy end-users and business goals in all industries. A good UC solution needs to be feature-rich, reliable, flexible and easy to manage. There are a lot of confusing options to navigate, and it’s the confusion that is the problem. That’s why 3CX is very transparent about our licensing and pricing. What you see is what you get, and we’re always improving the product to bring the features that customers need all together into one platform.

Steven Ansell
Steven Ansell

Steven Ansell, Collaboration Architecture Lead, Comstor: It comes down to definitions in a way, as it can get confusing. If UC is today’s VoIP solutions – on-prem or hosted call-control solutions – then I don’t think there are too many providers, and the main players like Cisco, Avaya and Mitel are still very prominent. However, when you look at cloud solutions, you see several service providers offering cloud calling only; they can swiftly move from UC to UCC, with collaboration solutions adding communication functions to traditional voice. In addition, other vendors like Microsoft and Zoom are joining the key players (Cisco, Mitel), adding voice to their core functionality – video-conferencing in Zoom’s case. With the move to cloud services for collaboration gaining more and more traction, the door is open for more providers to have a piece of the pie, because in most cases no hardware is needed. Being clear on customers’ needs is therefore critical in this market.

Technology Reseller: What can UC resellers do to protect their margins and prevent a race to the bottom?

Paul Taylor, Sales Director, Voiceflex: They need to be selling leading-edge technology with an understanding of the customers’ needs and requirements. I know a high percentage of users that just want a phone on their desk, or think they just want a phone on their desk, but how many times did Henry Ford need to convince potential customers not to buy a new horse & cart? If you’re inclined to probe a little deeper, peel back some layers, you will be rewarded.

A hosted telephony application is much more than a phone on the desk. If the channel partner is only interested in selling a me-too product, margins will be small. Application-based selling has been, and always will be, more profitable than a me-too approach. Being the best at what you do takes hard work and dedication. You will need to learn AI, APIs and invest not only cash but time in learning and understanding leading-edge applications.

John McKindland
John McKindland

John McKindland, Head of Solution Sales, Nimans: Delivering a quality offering is key. There are cheap options in the market and they can cause technical problems and even equipment failure, so buying purely on price isn’t always the best way forward. Be an expert in your field and have the right product set, collateral and knowledge. Price will always be a consideration, but if you are credible and a trusted advisor then it becomes less of an issue.

Dave Reynolds, UK Managing Director, Xelion: The key factor is to sell a value added solution that differentiates the reseller from competitors, so you are not just selling on price. Customers now want to integrate the hosted telephony platform with other back-office applications, such as CRM systems, for a true UC solution.

Xelion is not a ‘me-too’ product. RESTful APIs allow third-party apps like MS Exchange and Office 365 to be easily, seamlessly integrated with the service. This gives our partners the freedom to design bespoke solutions for customers with best of breed apps that really meet their requirements, instead of a ‘one-size-fitsall’ service. By adding value our partners generate profit.

This is why Xelion offers an Integration Market Place, providing partners with ‘prepackaged’ integration between the Xelion platform and a host of leading CRMs and other applications, freeing partners from spending time and money programming interfaces. Our vision is that Xelion should be the central UC hub in the corporate communication of the companies that use it, so it’s more than just a cloud telephony service.

Another critical issue for profitability is fixed-mobile convergence. To meet this need, resellers must offer a hosted solution in which mobile working is integral to the hosted service and not a tacked on afterthought. For mobile working, Xelion has standardised patented apps for desktop, mobile and tablet, providing users with the same interface and making it easy to use the solution anywhere, anytime.

Xelion desktop application is built upon the Universal Windows Platform (UWP) architecture that sets the foundation for Xelion’s ongoing integration within Windows and the Microsoft eco-system. A major focus for the Xelion development team is continued integration into Office 365 and other Microsoft applications, such as Power BI.

Jeff Blackley
Jeff Blackley

Jeff Blackey, VP, UCaaS Solutions Marketing, PGi: With over 120 Unified Communications providers in the North American market alone, a price war could be expected. Yet, there is far more to consider than price, and customers understand that. The winner in the eyes of the customer is often not the lowest priced provider, but the provider that best solves the issues the customer is facing, while remaining competitive on price.

Resellers can bring value and avoid a race to the bottom by having a broad and unique solution set. Being able to tackle a wide variety of customer issues and offer additional services to complement the UC solution provides differentiation in this competitive market. The more unique your approach, the better.

Nick Wright
Nick Wright

Nick Wright, Commercial Manager, Westcon Avaya: Look beyond the technology and show how it can help shape and drive a customer’s future and direction. Engage with customers as a consultant first, supplier second. Talking about current and future state, understanding barriers and widening the conversation will deliver great value. A discovery approach around ‘what’s the challenge?’ will yield opportunities beyond UC and into networks, security and applications. Services are central to the ability to consult, fulfil and manage. For example, Westcon’s refresh and renewals service helps to maintain a partner’s relevance and drive that forward-looking discussion.

Gareth Long, Head of Hosted Voice Programme, Daisy Wholesale: Resellers need to ensure they are partnering with providers who can offer a full suite of products that work together to optimise the UC solution. A reliable and quality service will sell itself, regardless of the margin you put on it. By offering a service that meets all of a customer’s needs, resellers can put themselves ahead of competitors, allowing them to avoid the race to the bottom.

Additionally, the rate at which technology is evolving makes future-proof solutions a necessity. With Daisy’s One and Only Convergence Solution, our Partners can offer their customers a market-leading portfolio designed for the future. This suite of products provides a refined balance of flexibility and functionality, while delivering enterprise-grade connectivity, all priced to allow our Partners to make a significant margin, navigating the UC landscape without compromising on profit.

Mike Adams, Channel Manager, Zoom: The focus of a reseller should not be margin percentages, but the total value of a project, including recurring revenue, and the total addressable market. As an overall market trend, the cost of UC solutions and meeting room solutions is going down, but the volume is going up, as more and more companies are deploying UC solutions collaboration technology in more and more of their meeting spaces.

For a reseller to protect their margin and their business, they should embrace the move to lower cost solutions and focus on deploying them to many more customers and meeting spaces and on winning much larger deployments within a customer’s environment.

Zoom is helping the whole industry with the shift to much larger deployments at a lower cost. It is helping to increase the overall addressable market for resellers, with a new business model driven by low-cost software licences and recurring revenue. The most successful channel partners are the ones who fully embrace this new business model and promote it to their own customers, which results in better customer satisfaction, higher usage, more loyalty and a much longer term relationship. The net result will be much higher revenues and total margin value for the channel.

Paul Clarke, Channel Manager North UK, 3CX: Resellers should work with a vendor who is stable, reliable and

Paul Clarke
Paul Clarke

who they can be confident about investing their time and money with. A vendor who is clear and transparent about not only their product, but also what is required from their resellers and what is expected from them.

They also need to move away from this idea of just selling hardware and software. Customers are increasingly choosing lower cost solutions, but if the reseller can provide an entire solution from start to finish, they are not going to lose out on any profits. Give customers what they want by providing them with a low-cost solution but bundle the system with add-ons such as IP phones, CRM packages and support. Instead of just being product resellers, focus on becoming solution providers.

Steven Ansell, Collaboration Architecture Lead, Comstor: Forward thinking and agile UC resellers by now should have taken steps to be involved in the move to the cloud. Clients will increasingly be demanding collaboration tools and resellers need to team up with a cloud SP, work closely with one of the market leaders, or even set up their own offering. Being trained and skilled in solutions is the most important value to add to clients. It’s like when VoIP began displacing traditional PBX. Resellers that sat on the fence and didn’t make the move closed their doors. Change happens constantly and regularly in the collaboration space, and the winners are those that move with the times.

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2018