Channel partners' perceptions of cablecos are evolving, as evidenced in Channel Partners' second annual survey of partners' interest in, adoption of and opinions about selling cableco telecom services to businesses.
Only 30 percent of channel partners responding to the inaugural survey viewed cablecos as "primary network providers;" in 2012 the number jumped to 51 percent. Another noteworthy change was the number of respondents that viewed cablecos as "voice providers;" the number increased from 50 percent last year to 60 percent this year. Furthermore, only half would describe cablecos as "niche network providers," down from two-thirds of respondents in 2011.
Those changing perceptions also are translating to selling activity. Most channel partners that sell cable telecom services said they are “best as secondary backup providers," but 32 percent said cablecos are “best as primary providers," up from only 13 percent in 2011.
As in last year's survey, two-thirds of respondents in 2012 said the lack of SLAs on coax services prevents them from recommending cablecos as a primary provider. The same number said they would recommend coax as a primary service if it had SLAs. That said, 75 percent of respondents said high speeds on coax services compensate for the lack of SLAs and 58 percent said low prices do. In response to a new question on the 2012 survey, two-thirds of respondents said they would recommend cablecos as primary providers for fiber-based services.
So what changed in a year? The answer appears to be that cable operators have had more time to flesh out their partner programs. Previously, agents and VARs wanted to sell cable services as an alternative to the telcos, but were stymied by the lack of cohesion that would allow them to sell throughout a cableco’s territory and to be paid for those sales. By 2011, four of the top five providers — Comcast Business Class, Time Warner Cable Business Class, Cablevision and Charter Business — had launched formal programs, helping to alleviate those problems. Then, in 2012, the fifth, Cox Communications, started a referral program. All five companies have spent the months since Channel Partners' 2011 State of the Market report honing their product offerings and channel support. For example, Charter Business hired a telco-centric executive as its channel chief. Thus, now that partners' concerns largely have been addressed, they're able to consider the cablecos’ services and programs in the context of the broader competitive landscape.
When comparing cablecos and telcos as providers of business telecom services, respondents favored cablecos on price to the end user, but not much else. This was the same result as last year’s survey, but the degree has changed somewhat. Forty-three percent (compared with 60 percent in 2011) said cablecos were worse than telcos with regard to network availability and coverage. Interestingly, 26 percent (compared with only 10 percent in 2011) said cablecos were better on this point, which may mean cable is closing the gap.
Channel partners generally rated cablecos' partner programs as no better or worse than telco channel programs; the most common response was "neutral" on most criteria evaluated. That said, the remainder of the evaluations skewed toward "worse" or "much worse." Year over year, however, there were fewer respondents who said cablecos were worse than telcos and far more that said cablecos were better.
Get your copy of the report "Cablecos & The Channel: State of the Market 2012" from the Channel Partners Resource Center.