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I Can See Clearly Now?

Timing is everything, especially when it comes to rolling out products that companies will buy (especially buyers that are myopic or tend to be narrowly focused and not willing to spend money--yes, they are thrifty). Remember the promises of saving up to 80% on costs, and yet what about the sales of P2P solutions? Remember Avaya's One-X, Aastra's former Venture IP?The very small (VS) market with (4 lines X 16 stations) configurations is a pretty big and collectively they do attract attention from retailers and manufacturers. Costco, Dell, Office Depot and Staples are all in the act of selling these solutions. In fact, they were the same ones that sold KSU-less gear. The so-called "sweet spot" for specialized hosted guys are the 25+ seat call centers.

So why hasn't P2P taken off? Or it has and I missed that boat. I'll concede missing the maiden voyage when the MSPs grabbed more market share than what I thought possible, mainly with Asterisk and Digium, but the numbers aren't exactly convincing me either. Since distributors aren't exactly telling me anything new--that there are no sales or they are very flat for P2P and VARS/Interconnects aren't pushing P2P solutions. So in the days of the 4-line KSU-less systems that were hawked--who sold them, why did companies buy them and if they're not buying them today, then what are they using? Maybe open source is grabbing significant market share after all and it's hidden away in the details.

Entertain for a moment the way I see P2P and hosted solutions. There are key elements in winning P2P or hosted business and maybe remain viable as an Interconnect/VAR:

a) you sell the infrastructure--wiring, switch(es), firewall, router or you sit back and let the hosted provider take over the gear and you provide the leg work, b) you sell the P2P solution and set it up even though you know the customer can do most of it themselves c) you sell the ITSP service on commission d) then you wait. You wait and hope that the customer is successful and grows out of their P2P solution and into something bigger, better and with lots of anything that you can sell e) then you wait some more. No MACs revenue is coming in--unless the customers grow, there is very little churn. No churn, no revenue. Greeter positions at WalMart are drying up so as you begin to wonder, you know that... f) Eventually something must break--and hosted providers and the retailers don't have trucks to roll, so when the call comes in, be ready, be able and bill accordingly. Some of these customers will want to bail and some will decidedly want control or some other need that wasn't being met.

Then there are some other considerations:

* Potential customers and businesses aren't educated about the benefits of P2P/hosted solutions and equally speaking, they don't know the risks of P2P/hosted solutions

* The retailers and providers aren't putting skin in the game but they are recapping profit over profit until the customer becomes burdensome or walks because not all retailers and providers provide truck rolls

* Some Interconnects/VARS don't see good enough margins in selling them and still resist/resent the loss of MAC revenue with IPT solutions of any type, and everyone knows that commissions don't last forever or long enough, and then if the P2P/hosted solution bombs, so does their credibility

* The ITSPs don't want to risk competing with their resellers and creating competition with and between their MSPs or

* While the above may be true, open source has circumvented traditional lines of distribution and handset sales are distorted in the channel, being represented as PBX or IP-PBX sales?

* One size does not fit all

* The very small business and startups tend to gain the most advantage using P2P/hosted solutions and they also stand equal chances of outgrowing their initial solution, not just because of size but because of control, features/functions and other needs

When the provider bundles or bonds multiple T1s to muster up enough bandwidth to support the organization, the big pipe becomes the umbilical cord that must stay connected all the time. Customers may or may not have any visibility into their network and when they don't, elements of accountability are missing and this only benefits the provider. Is bundling pipes to deliver a solution really doing more for less when in fact the risk has shifted? You may want to ponder which is riskier--the CPE gear or the bundled pipe? Now, argue why.

What is clear is that the telecom market is more akin to being an illusion than anything else and I do think this is where we run into snags and landmines. Everyone wants to be in control of the phones or voice, everyone one wants to earn a buck and leverage something with something else to take over voice, but not everyone wants to be a phone guy or gal or even carry the responsibility that goes with. Another observation is that while some of you may remember the days of getting off of Ma or Baby Bell, it seems that you no longer hear those terms, yet after all these years, the intentions are really still the same.

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