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PAETECs Cavalier Buy Lets Agents Target Small Business Accounts

The acquisition of Cavalier Telephone is giving PAETEC agents exactly what they want: access to a network that lets them go after small business accounts.

Until now, PAETEC has focused on the mid-size and enterprise markets, largely overlooking the smaller segments because of last-mile cost and the lack of colocation space. But thanks to the recent, $460 million Cavalier Telephone purchase that included the Intellifiber Networks assets, thats changed, and PAETEC can compete for users who are more concerned about price than solutions.

We can serve single-line and residential customers now,” said Donna Wenk, senior vice president of sales operations and customer care.

For legacy PAETEC agents, that has meant the immediate ability to sell POTS and T1 lines. Master agency World Telecom Group, for one, welcomed the new focus.

Typically it has been difficult, if not impossible, to tap such a big player for down-market customers, as PAETEC is now strategizing to do,” said WTG CEO Vince Bradley.

His agents are excited about the evolution, he added.

PAETECs channel is one of the best in the industry so we see it as a win-win.”

Jay Bradley, president of telecom services at master agency Intelisys, agreed. One of the PAETEC-Cavalier tie-ups greatest benefits is that it opens multi-location opportunities for partners, he said. Plus, the expanded fiber footprint gives PAETEC greater control of local access and the overall customer experience. Subsequently, the acquisition will help provide pricing advantages in those locations by leveraging PAETEC’s cost structure. We look forward to the continued expansion of the PAETEC SMB product offerings.”

Meantime, Cavalier agents most of whom were not working with PAETEC before the merger have had to wait a little longer to start offering PAETEC products. When that happens, theyll be able to expand their sales options to more up-market clients.

That leads to a critical point Wenk wants to emphasize to Cavalier agents: that even though they may be moved over to the PAETEC side, anything sold under their old Cavalier contracts will remain intact.

We dont intend to touch or harm the commissions they have with Cavalier thatll all be grandfathered,” Wenk said.

The people who supported the Cavalier channel are sticking around, too. All Cavalier channel managers are in place and so is Michael Gough, Cavaliers channel chief. 

Some other aspects also will stay the same for a while. Cavalier agents will continue to use that carriers quoting and ordering system until Cavaliers products are integrated with PAETEC that is, unless theyre selling PAETEC services. If thats the case, theyll use PAETECs platforms.

Meanwhile, thanks to the Cavalier merger, PAETEC has formed a small business unit that supports subscribers billing less than $1,000 per month. The division comes with its own management team in three regional hubs. Wenk said the attention to better servicing and supporting of small business users will improve retention and upselling of that segment.”

X4 Solutions, an Illinois-based master agency, looks forward to the growth thats coming from the PAETEC-Cavalier union.

Our initial understanding of the synergies leads us to believe the combined organization will achieve further network density in some of our key territories,” said Curt Allen, president of X4 Solutions. We are also being told that Cavalier adds some cost-structure advantages and some product enhancements in certain markets. As always, we know PAETEC will be deliberate in their integration of Cavalier to minimize disruptions, [and] we look forward to the continued expansion of our partnership with the combined entity.”


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