Convergence: Telecom Moving into Mainstream IT Channel

20-Minute Channel Byte

Copyright (c) 2014 CompTIA Properties, LLC. All Rights Reserved. | CompTIA.org

Convergence: Telecom Moving into Mainstream IT Channel


On Tap For Today

Trends in traditional IT services and telecom convergence

Drivers behind IT channel’s entrance into telecom

Partnering trends between IT channel, telecom channel and providers

2

IT & TELECOM: NO LONGER SEPARATE SILOES

3


IT and Telecom Blending to Serve Myriad Vertical Industries

IT Industry

$2T

Healthcare

Telecom Industry

$1.6T

Retail

Finance Manufacturing Government

Legal

Source: IDC

Customer Needs Growing More Complex

Increasingly, customers are seeking providers that have mastered a blend of skills

All things cloud Mobility integration, integrating

mobile devices with the corporate network

Unified communications, integrating

services such as instant messaging, presence, IP telephony and others.

Telepresence technology, marrying phone systems with video capabilities


As Are Their Strategic Business Priorities for Next 12 Months

16%

34%

37%

42%

50%

52%

56%

Managing competitive threats

Improving operational efficiency

Innovating more effectively

Improving data analytics forbetter/faster decisions

Reaching new customer segments

Improving staffproductivity/capabilities

Reducing costs/overhead

Source: CompTIA’s 3rd Annual Trends in Managed Services study Base: 400 businesses (end user)


Driving Factors in Entering Telecom Services Market

8%

15%

24%

28%

29%

40%

41%

46%

Recruited by telecom master/subagents

Add on to cloud business efforts

To increase revenue/profits

Competitive threats from telecomchannel

IT distributors added telecom toportfolio

To win new business

Desire to add new business line

Desire to offer voice services

Source: CompTIA IT-Telecom Convergence Research


From the Channel Viewpoint: Convergence

Where should traditional telecom services fit into an IT channel firm’s

portfolio?

56% 34%

6%

2%

Characterization of telecom and IT channel relationship over last 2 years

Staying same

Converging significantly

Converging somewhat

66%

32%

2%

Core component

Opportunistic element

Not a component

2% D/K


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Unified Communications Driving Telecom Solutions

Primary Telecom Offerings by VARs

Today

Broadband/Wi-Fi access

Conferencing &

collaboration solutions

WAN services IP/PBX

TO PARTNER OR NOT TO PARTNER

10

Partnering a Way to Help Bridge Skills Gaps

With both VARs and agents needing to fill holes in their capacity to deliver cloud services, they are left with the following choices…

Hiring or developing expertise in-house. Referring the business out to an expert. Partnering with seasoned professionals to fill voids they cannot otherwise address.


Friend or Foe? Convergence Sparks Both Viewpoints

1

2

3

4

5

IT VARs said they now view telecom services as a competitive play and a way to differentiate their brand

4 in 10 IT channel firms are “highly concerned” about the telecom services channel getting into traditional IT

One-fourth of telecom agents (23%) said the roles of IT VARs and agents were "converging significantly."

57% of channel firms worked with a cable company to offer telecom services last year

Carriers and master agents are diversifying their partner base to include traditional IT-oriented VARs and MSPs.

VARs and Telecom Agents and Convergence Trends

Source: CompTIA 2nd Annual Big Data Insights and Opportunities study


What Are Your Options for Partnering?

Partnering discussions held with the following company types in last year

52% Telecom master agents 51% Telecom sub-agents 47% Telecom carriers 26% Cable company operators 26% IT distributors



Who Ended Up Moving from Talking to Partnering?

Breakdown of Partners IT Firms Worked with in Last Year

57% Cable Operators 51% Telecom carriers 34% Telecom master agents/subs 20% A/V specialists


68% of IT channel firms working with telecom carriers in the last year did so

exclusively, while 32% also partnered with telecom agents.

CHALLENGES AND BEST PRACTICES

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Challenges to Entering Telecom Services Market

10%

30%

30%

37%

38%

40%

45%

Don't understand agent model(master or sub)

Customer preference for traditionaltelecom provider

Deciding what to sell

Lack of sales experience

Competition from traditional telecomagents

Lack of telecom-specific tech skills

Insufficient staffing



Not Every Channel Firm is Diving into Telecom

Reasons NOT offering telecom services today

4%

9%

9%

17%

30%

61%

Do not understand revenue model

Learning curve too steep

Bad past experience

Insufficent resources

Diverts from core competency

Not our core competency


Among the IT channel firms not involved in telecom

today, 26% said they plan to pursue partnerships for these services in next year, while 35% said they had no

intention to partner and 17% said they would offer

telecom on their own.

Rank VARs Agents

1 Partner’s understanding of my business model (49%)

Effective communication (73%)

2 Formal business planning with partner (48%)

Partner’s pre-, post- and joint sales support (54%)

3 Emerging techs and business models (i.e. cloud) (48%)

Leads provided by partner (53%)

4 Government regulation and compliance (46%)

Emerging technologies and business models (49%)

What’s Critical to Making Things Work

Source: Channel Partners and CompTIA Agent-VAR Partnering Survey, January 2013

Success Factors and Priorities for Partnerships


Five Key Ways to Mitigate Risk in Partnering

1 Establish rules of engagement

Decide who owns the customer relationship

Agree on a revenue formula and who gets paid for what

Understand each other’s business model

Formalize these partnerships and treat them as you would any vendor or manufacturer agreement

2

3

4

5

Closing Thoughts: Scorecard on Offering Telecom

Gained net-new customers as a

result of having telecom services

Increased revenue with existing

customers due to telecom

services

Trained internal staff on technical

and sales skills associated with

telecom

1

2

3

4

6

5

Won a deal purely based on telecom services availability

Did NOT gain any new revenue because of telecom services

Lost business to a telecom agent


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Carolyn April [email protected]

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Convergence: Telecom Moving into Mainstream IT Channel