The Cavell Group held another European VoIP Summit last week, this time in Amsterdam. Interestingly the Netherlands has the highest penetration of VoIP of any country in Europe and very few delegates attending would have left without a distinct flavour of the opportunities in this exciting sector over the next few years.
Walking the short distance from my hotel to the venue, I was struck not only by the sheer number of cyclists on traditionally styled bikes but also, and in complete contrast, by the number of electric cars and car charging points. The new mingled with the old in what appeared to be perfect harmony.
The venue itself continued this theme, being located as it was in an old church attached to a modern hotel. The conference, packed with all the latest visual and audio conferencing equipment, was of course well attended with delegates from the large global VoIP infrastructure providers as well as numerous VoIP service providers from all over Europe. Content consisted of a good mix of presentations and panel discussions led by the very capable and knowledgeable Cavell team.
There were a few themes that were comparatively new and some that have been prevalent in every VoIP conference that I have been to over the past couple of years. As you would expect, the ‘elephant in the room’ made an early appearance, with all the usual questions and debates about Microsoft’s ‘Skype for Business’. There were some interesting debates about getting service providers to think ‘outside of the box’ so as to prevent new innovative providers ‘eating’ what would be regarded in IP terms, as their now ‘traditional lunch’.
There was one theme however that I found particularly interesting and it should excite all telecommunication service providers however small. A bit of background might be useful:-
The days of aspiring VoIP service providers having to buy expensive servers and software and then being lumbered with mandatory software and hardware upgrades forever and a day have gone. Yes, of course, the large telcos will continue to operate that way but they have the negotiating muscle to strike a deal that the small player will never be offered. For the smaller provider there are currently only two viable options – either to build or to offer a cloud service from a multi-tenanted switch. Many really successful service providers on the continent have built their own solution from scratch – mixing bits of Asterisk, Freeswitch and Mitel etc to come up with what I assume is a licence free solution that clearly works and is clearly scalable. However, these players have been at it a long time and it has taken them many years to get their networks to the stage they are at today. They have the challenge of having to be technology driven, employing engineers and developers and must always try to stay ahead of the game. To start from scratch today to offer a traditional business grade hosted service would be incredibly difficult. There will of course be new web based solutions similar to Twilio but while these can be successful, they will probably remain fairly niche for some years to come and it assumes that service providers and even end users want to get involved with software development as opposed to selling stuff and getting on with their day-to-day business.
So for me the big opportunity is provided by the provision of multi-tenanted platforms that can be developed and managed by experts and can be run at an economically viable capacity level. The Broadworks’ platform has been very successful over the past couple of years, particularly in the UK. Companies such as Siphon Networks have been at the forefront of providing such a service from a Broadworks platform. Centile in France has also been quietly getting on with its own platform and now has an impressive range of customers and its focus on mobile integration gives it a strong point of differentiation. Genband has launched their Nuvia solution now rebadged ‘Kandy for Business’ and has succeeded in signing up customers in Europe.
In some ways this business model reminds me of the early days of mobile when the only two networks Vodafone and Cellnet sold through Service Providers to bring more competition to the market place. On the one hand the mobile operators built and managed their networks while on the other the service providers got on with selling and providing customer service. Today, as wholesale cloud services become more prevalent, prices will come down further bringing the cost of entry to levels that even small service providers can afford. Many of these service providers will still however have a large estate of managed analogue PBX’s and CPS which will have to be migrated as the time for PTN switch off draws ever closer.
I know that there is little change from £1m plus to buy servers and software from any of the big US infrastructure vendors and running costs are likely to be at least £200K PA. Buying a multi-tenanted cloud solution does immediately solve the issue of the high up-front costs, much of the running costs and the dreaded upgrade costs further down the line but there is however another problem to be solved that many service providers don’t normally recognise when they first get into the market.
Again some background might be in order. VoIP is quite complex from an operational stand point. We all know that many things have to come together to complete a successful business installation and when selling VoIP through a complex channel structure this becomes even harder. Because margins are quite low, service providers who are not efficient are likely to struggle and a provider that continually messes up orders or installations soon loses credibility. A VoIP order normally consists of connectivity – analogue lines; broadband; leased lines; hardware- phones, routers, switches, most of which have to be configured; numbers – porting, allocation, emergency service management and then the provisioning of all services across the end user’s estate. Managing and coordinating all of this is hard enough on a single site installation but when managing it across a multi-site requirement it becomes impossible without good systems. Most service providers end up trying to develop these themselves in an attempt to find a USP. Most who have done this have spent anywhere between £500K to £1m and often do not end up with a great solution. Smaller service providers entering the market will not be able to afford to develop these systems themselves and larger operators fanning out their operations into new countries are likely to struggle with their existing systems unless they invest time, resources and more money.
THERE IS HOWEVER A SOLUTION. Processvine’s VOIPFUSE service manages the entire system end to end or as they say in the US from ‘quote to cash’. It is designed to be multi-tenanted and is highly affordable. One of the most interesting features about VOIPFUSE is that the UI is separate from the core and employs open API’s allowing service providers and even end users to make it entirely their own or to integrate it into existing systems. Deployments are unlikely ever to look the same and Processvine’s development team are always available to add specific features for customers if required. Easy white label options are also available and the service is designed to work across different countries and in the most sophisticated channel structures.
VOIPFUSE is, I believe, the only VoIP management system on the market today that;
- Provides a total end to end system
- Works across numerous soft switches
- Employs CPQ (configure, price, quote) tools
- Has open API user interface
- Is designed to work in a channel and direct environment
- Pushes as much provisioning as possible to the user
- Manages all telco and IT products and services – not just VoIP
- Is available as a cloud or on-premise solution
- Automates communication throughout the order management process
- Manages documents and contracts
The end result is a very compelling business model. Service providers can provide an affordable business communications service incorporating all the latest collaboration, video, mobile and contact centre features and functionality. They will be able to interact both with their customers and their distribution partners and end users will have a system that manages everything on a day to day basis from a single log in.
There will be many more European VoIP Summits – the next one is in London in March. Like electric cars, hosted VoIP has taken many years to get where it is today but there is an emerging business model that providers of all sizes can embrace with confidence and one which will allow small players to compete successfully with the very largest.