TMC interview with Matt Bramson, CMO

IT Expo 2011

I spent the day today at IT Expo at the Miami Beach (just across town from our headquarters) and here are some observations and thoughts.

Concern About the Channel

More than one person today has asked me my opinion on the future of the channel, meaning the telecom agent channel. The concern is that channel programs appear to (again) be threatened with major carriers, like – most recently – Verizon, dramatically shortening the list of products the channel can sell and others – like AT&T – insisting that agents bundle mobile phones and plans into sales to qualify for commissions, looking to push the channel in ways that may not be beneficial to its health. But the more profound threat – and to me the more interesting one – is whether the decided shift to complex, cloud-delivered solutions is one to which the channel will successfully adapt.

There is no question that the stereotypical telecom agent – who knocks on doors, learns what a company buys today, and returns tomorrow with several quotes for comparable service for less – faces a challenging transformation. Those that will thrive, in my view, are the agents and agencies that understand their customers – and perhaps are vertical or even niche-focused – and that view the glass as at least half full. Yes, it’s true that the old way of doing business is going away but the new way actually offers tremendous opportunity. Instead of selling Internet access for perhaps $20 per user per month you can sell hosted applications that could amount to $100 per user or more. Agents that spend the next year clinging to the old way will fail. Those that embrace the new opportunities can prosper.

Knowing your customers and having a narrow focus could be a real key. Here are a couple interesting examples. Did you know that in the US alone there are 350,000 dentist offices? Focusing on just dentists – by developing a suite of applications that meets their specific needs – could result in a huge business. If you assembled a bundle of hosted applications – PBX, CRM/Practice Management, HIPAA-compliant storage/backup, and a few other apps – you could offer dentists a differentiated choice to the generic offerings of the leading telco providers. And if 10% of all dentist offices became your customer for $500 each per month that would be a $200 million business. It’s just an example – but it does illustrate that there are types of opportunity available today that didn’t exist a few years ago.

Clouds, Clouds Everywhere

Walking the exhibit hall floor it is clear that “cloud” is a term that is nearly-universally embraced – in the industry. Most booths and collateral display the term prominently. The challenge with this – and any industry-darling buzzword – is to make it relevant to customers. “Cloud”, in my view, has a ways to go on that front. The real benefits of cloud-based application delivery depends on customers changing how they operate too. A business that still runs mostly conventional installed software and stores much of their data locally is not going to fully benefit from the potential of the cloud. How many businesses are really ready for a cloud-centric methodology? Who will educate them to the wisdom of this approach? The answer is likely circular: whoever does will be successful at selling them a bunch of cloud-based services.

Now I’m off to Startup Camp – one of my favorite features of IT Expo.

Matt Bramson, InPhonex Chief Marketing Officer Keynote Speaker at ChannelSolutions 2011 in New York on 1/25/2011

I am looking forward to being the keynote speaker at ChannelSolutions in New York next week. This all-day conference should be extremely worthwhile. Unlike a lot of other conferences this one promises to be refreshingly tactical. It is billed as an ”event [which] will bring experienced providers and sales partners together, sharing their insights on what works, what does not work, and why.” During the course of the day we will hear from more than a dozen providers of innovative business services. There is still time to register at http://channelsolutionstoday.eventbrite.com/

For my keynote I plan to establish a tactical tone at the outset. I believe strongly that 2011 and 2012 are going to be momentous for the business telecommunications marketplace. The next 24 months will be pivotal in determining the landscape for years to come – especially for cloud-based service providers and service distributors. Why do I say that?

I entered the telecom industry as a serial entrepreneur on the heels of the Telecom Act of 1996. I decided telecom was the wave to catch so I jumped on board what looked to be a promising ride: Craig McCaw’s Nextlink. The last 15 years have taught me how to read the currents, winds, and tides. Some are widely recognized like the transition to packetized voice, increased broadband penetration, the growth of wireless and smartphones, and the advent of the cloud-based service model. What makes the next 24 months so promising is that other forces are beginning to have a major impact. Here are three that need to be understood and mastered:

1. Customers are changing. They are increasingly comfortable with the idea that they must provide certain key elements of business solutions like adequate, high-quality bandwidth, a reasonably-well-engineered LAN, and an ability to quickly master user interfaces. Expectations like LAN assessments, on-site installation and training, and provider-performed moves, adds, and changes are diminishing – fast. The same people that have learned how to setup a PC or two, a wireless LAN and printers, and a NAS at home are gaining the confidence to do the same thing at work.
   
   
2. Services and service providers are changing. The fastest-growing business telecom service providers don’t have their own network or dozens of data centers or armies of field technicians or even large sales forces. What they have are services that solve important business problems and the ability to sell and deliver those services. Services are changing too. The cloud-based model provides efficient means to deliver specialized solutions. The old model presented major obstacles to creating a solution for a single type of business – the emerging model makes it possible and even preferable. And the large business telecom provider orthodoxy of never crossing the demarc has never been as crippling for them as it will be over the next 24 months.
   
   
3. Sales is changing (and needs to more and faster). Since about 1990 – the advent of the AT&T/MCI split-screen ads – telecom sales has been about making and proving one claim: a comparable service at a lower price. Telecom “salespeople” simply needed to find out what a business was buying and how much they were paying. Then they offered an equivalent service at a lower price and, a decent percentage of the time, they got a new customer. Most still practice the same approach. The large business telecom providers seem more or less convinced that this “sales” approach doesn’t urgently need to change. They just need to keep putting products and pricing in the hands of their “salespeople” that allow them to keep on keeping on. But the game has changed – and will continue to – right under their noses. It’s like the story of the boy who rode his bike across the border everyday – the guards would search him and find nothing – because he was smuggling bicycles. Telecom salespeople couldn’t/wouldn’t sell solutions so now they don’t – they sell bandwidth and other basic, commodity services that enable others to sell solutions on top. They’re selling the essentially the same stuff as they were 15 years ago only it’s not the solution anymore – and many seem just as blind to it as those border guards were.

What I think all this adds up to is a unprecedented opportunity for cloud-based business services providers to use the next 24 months to realize huge growth. Here are the keys: offer services that the large providers can’t or won’t, leverage the willingness of customers to be part of the solution, and – most important – sell through understanding and solving business problems (or partner with companies with salespeople that do). Two years from now several currently-unknown companies will be well on their way to $100 million in annual revenues from sales of cloud-based business services. I wouldn’t be surprised if one or more of them is in the room with me in New York next week.

InPhonex Selected by Nuance Communications to Stress-Test Custom Speech Applications

Using InPhonex Platform, Nuance Underscores Commitment to Delivering Positive Customer Experiences in the Contact Center

MIAMI – InPhonex, which provides a comprehensive array of telephony services, today announced an agreement to supply Nuance Communications, a leading provider of speech solutions, with a robust, high-capacity platform to stress-test its custom speech-enabled contact center applications.

The InPhonex platform generates the sustained volume of incoming calls needed to prove the resilience and capacity of Nuance’s applications, which automate functions otherwise performed by human agents. Playing prerecorded clips of callers’ utterances during the calls, InPhonex enables Nuance to test its customers’ contact center solutions before putting them into production – to deliver the best customer experiences.

Nuance is using InPhonex’s platform to make thousands of simultaneous calls to applications that Nuance has designed and deployed for Fortune 500 clients in retail, banking, travel and other industries. These applications, tested on Nuance customers’ servers, automate common telephone transactions, such as prescription refill requests, bill payments and airline-ticket purchases.

“Given the caliber of our clients and the volume of calls handled on a daily basis, it is important that we ensure our speech-enabled contact center applications stand up under very heavy customer usage before we put them into production,” said Ken Arakelian, IT Solutions Architect, Nuance Communications. “With its channel capacity, InPhonex enables us to test, without having to purchase dedicated PSTN connectivity for our own test bed. And thanks to InPhonex’s willingness to learn and adapt to our particular needs, we are able to control our test methods and our budget.”

As Nuance performs its testing, it draws from banks of prepaid calling minutes set up for each of its custom clients, keeping a tight rein on costs.

“Once we understood Nuance’s very specialized business requirements, we built them something our more typical, private-label service provider customer probably never would have dreamed of,” said Matt Bramson, Chief Marketing Officer of InPhonex. “Interestingly, Nuance’s success with us makes a great proof case for the qualities most providers look for in suppliers: capacity, reliability and flexibility.”

About InPhonex
InPhonex is a global meta-carrier providing a comprehensive range of high-quality, feature-rich telephony services in more than 150 countries. Leveraging its flexible, high-capacity telephony platform, Miami-based InPhonex serves communications service providers, businesses of all sizes, value-added resellers (VARs) and consumers, under its own and other brands.

Offerings include multiple applications, services and utilities, such as VolP, hosted PBX, SIP trunking, product creation and provisioning. Easy to implement, InPhonex solutions help businesses round out their portfolios to attract more customers, manage more efficiently and generate more revenue per customer. For more information, please visit www.inphonex.com.

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So What Haven’t You Heard Before?

Yesterday I had the opportunity to be interviewed by Gary Kim, serial technology entrepreneur, journalist, and Mensa member (according to the backgrounder on him I was sent). Gary is the Editor-in-Chief of both Fat Pipe and IP Business magazines. Today I was a panelist in a session moderated by Gary. I enjoyed both the one-on-one discussion and the group discussion. One theme the two discussions had in common was “the death of the demarc.”

For a generation the demarc was the division between the service provider’s stuff/responsibility and the customer’s stuff/responsibility. IP telephony has started to change that and SaaS practically obliterates it. Whether you consider the death of the demarc to be good or bad probably depends on who you are and how satisfied you are with the status quo. It will be interesting, though largely predictable, to see who embraces the death of the demarc and who resists it.

The topic of the panel today was “The Business Case for VoIP – Going Beyond ROI/TCO” and I think going beyond the demarc to understand the needs and ambitions within the homes and businesses of your customers is one of the keys. This is what the launch of our new joint product with Ringio is all about. The Ringio On InPhonex (ROI) application is all about radically improving the way a business connects with its customers, collaborates internally, and assures its competitive edge. The dialog necessary for a business to appreciate the true value of ROI will be focused on topics like: Why do customers call you? What do your employees need to know about the customer as they answer the call? How important is it for you to be reachable and responsive to your customers? What business tools and information do your employees need when they are outside the office? How do you measure your communication effectiveness?

The questions that will not dominate a successful discussion include: How many phone lines do you have today? How much do you pay your current provider? How many minutes of calling do you do? These are the old, service-provider-side-of-the-demarc-questions – certainly not irrelevant but no longer the entirety or even the core of the discussion. It will not be easy for many service providers or their salespeople to make the adjustment. Many customers may also be slow to appreciate the importance of shifting their buying process away from simple price comparisons to more detailed reviews of capabilities and interfaces.

Walking out of the session I had a chance to talk with Gary one-on-one. I asked him, “So all day every day you talk to people like me about our companies and our products. Do you get tired of it? Does it all start to sound the same?” He had an interesting reply: “There is one question I never get asked that I wish I would. And it is, ‘How much of what I’m telling you is really unique?’” So, bravely, I did. “Gary, so what that I’ve said to you in our conversations yesterday and today haven’t you heard before?”

His reply was direct: “Everything you’ve said about the power and flexibility of your platform I hear from several different people every day – whether it’s more or less true in your case is hard for me to evaluate. But what is different and exciting is your vision. You and InPhonex really seem to have your strategy figured out. Your clarity of vision is a powerful differentiator.”

It made me think back to the presentation by Simon Sinek at the SAP Executive Partner Summit in Cancun. I wrote about it in August. I think InPhonex has our Why figured out while nearly every other company Gary talks to is fixated on What and maybe How.

Discussions with people like Gary are really helpful – if a bit intimidating. What it reminds me most of is the months I spent writing my Philosophy thesis in college. I’d spend weeks reading and thinking and writing and then I would go into a meeting with my thesis advisor, a professor and, in my case, the Chairman of the department. This was the moment that the previous weeks of thinking and writing were tested. Was I making any sense? Was there anything original to my thinking? How close was I to proving my argument?

So, at least according to “Professor Gary Kim”, we’re on the right course. In college that kind of feedback would have sent me in search of too much beer. Today it will send me into the office tomorrow with even more enthusiasm.