Posted: 03/2001
Agency
Agents Become Business Partners as Carriers
Move Toward Data
By Tara Seals
Expanded alternate channel programs from Qwest Communications International Inc. (www.qwest.com), Sprint Corp. (www.sprint.com) and Global Crossing Ltd. (www.globalcrossing.com) still include telecom agents, but voice alone simply won't cut it for the carriers anymore.
Certification, a la the high-tech sector and other changes, also are in the offing, and carriers say traditional voice agents need to expand their expertise to compete.
In the meantime, systems integrators, interconnects, web consultants and others increasingly are included under the nomenclature of telecom "business partners."
While voice still account for significant telecom revenue, the high growth rate in advanced data is an industry trend that cannot be ignored. For instance, Salomon Smith Barney (www.salomonsmithbarney.com) predicts the managed data services market will grow to three times its $3 billion size in 2000, to $9 billion in 2001.
"This [focus on IT channel partners] that's occurring is a result of technological advances and general changes in the industry," says Craig Schlagbaum, Qwest's director of partner programs. "I believe the worlds of telecommunications and IT have collided, and what you're seeing is a rapid movement up the complexity food chain, where instead of just selling switched minutes and basic data services, what's happening is the industry is adding more support on IT and web hosting and managed systems services."
Schlagbaum adds, "As you move up from pure commodities into a more complicated world, you have to have greater competency and skill in order to sell to those types of products."
Certification is becoming a reality, as carriers want to ensure competency. At Sprint, instructor-led, web-based and CD-ROM training is available, and certification is required to sell some data products.
"As they get certified, they can implement the new service," says Jerry Koontz, Sprint's group manager for distributor acquisition. "In certain cases it may not make sense, so we have the option for the partner to team that business with the direct side."
Qwest also provides online and field-based education. Beginning in June, it will require that partners can pass an exam before they are permitted to sell the company's advanced data services.
"Solution provider partners, VARs, ASPs, system integrators; for those types it's mandatory," Schlagbaum says. "For the traditional telecom agents selling voice, it's not mandatory to get certified, but if they want assistance in making the pivot [to other services], then they will be required to get certified in these other product areas.
"If they don't pass, ultimately it would be at our discretion as to whether or not we want that partner in our programs," Schlagbaum says.
Despite rumors that Qwest is ready to abandon its voice agents, Schlagbaum insists the company "won't turn its back on the traditional telecom agent, the little guy." However, he warns that those agents need to keep an eye on the future.
"From a Qwest high-level perspective, we've all been directed to maintain and continue to utilize our traditional voice and data business as our cash cow, but our growth engine is clearly in IP and hosting, and that's where the focused energy and effort is going," he explains.
Reflecting his company's shift toward a data strategy announced last fall, Sprint's acting director of distributor marketing, Mike Herron, says his alternate channel program aggressively and primarily is seeking data partners.
Herron explains that customer demand is driving Sprint's preference for consultants who can sell total solutions.
"The customer is the one demanding this," Herron says. "They're trying to focus on their core competencies, and they want someone to come in and bring the solution to them. So we're really looking for those that are adapting their business model for that market."
Koontz explains that Sprint will tailor data portfolios to match certain partner profiles.
The channel program is discussing with Sprint its new E|Solutions group (www.sprintesolutions.com) to offer products such as ASP services, collocation, e-commerce, security, web hosting and Internet transport.
But Sprint says it still supports and recruits voice agents.
"What we're finding is that a lot of voice partners are strictly focusing on niche markets now to be successful--in language service and so on--and we certainly want to bring them into the fold," Herron explains.
As data services have increased, Global Crossing perhaps has been the most visible in steering away from traditional agents. The company's vice president of alternate channels, Pat Dolan, says Global Crossing will continue to work with existing voice partners "where it makes sense."
Even so, he acknowledges his team is reviewing contracts and evaluating the next move.
"It's really a situation of how we can't be everything to everyone, so we want to try to focus on the areas that we feel our network and products complement, as well as what our channel can complement," Dolan says.
"I think we've changed the focus of the program," Dolan continues. "Typically, the agent model was something that primarily drove voice business in the past, and we need to align our resources in the channel with the partners that are focusing in other areas as well--typically data products and services, as well as Internet services."
Dolan says the changes are a winning proposition for both sides, as agents are making the pivot to drive value to their customer base.
In the meantime, Dolan says Global Crossing is "looking at opportunities where we could have a similar program overseas."
At a national level, Dolan says he may implement platinum, gold and silver tiers.
"It really depends on how the customer is certified and what their overall capabilities are," Dolan says. "More back office, more service, more engineering support for those players that are capable of doing more in the marketplace--that's where we want to deliver more resources."
