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Service Providers Seek Partners to Keep Pace with Rising Demand

Posted: 2/2002

Service Providers Seek Partners to Keep Pace with Rising Demand

By Khali Henderson

Armed with enhancements to their technology and increased awareness of its availability, conferencing service providers are putting greater emphasis — some for the first time — on channel strategies.

In fall 2001, ACT Teleconferencing Inc., InterAct Conferencing and Premiere Conferencing debuted their reseller and agency programs.

Executive director for Premiere Conferencing’s agent sales Lynette Sharp says her firm’s switch from a direct-sales approach was in response to the souring economic climate as well as the simplification of the products for sale through distributors.

“When we were focused on operator-assisted conferencing, it was a longer sale. ReadyConference [reservationless audioconferencing] is a one-day sale,” she explains.

Most providers agree with InterAct’s director of marketing Leeann Morris, who says her company’s channel program was started as way to tap new markets for its conferencing services.

Some vendors PHONE+ interviewed are sticking with carriers as resellers and telephony agents as distributors, but a few are looking to interconnects, VARs, systems integrators and even vertical specialists, like travel agents, to form their channels.

High-Margin Sales

All agree they are offering the increasingly rare opportunity to provide high-margin sales.

“Conferencing is the last bastion of big margin in telecom,” says Jerry McEleney, vice president of wholesale services for Genesys Conferencing, which has run a channel program for three years.

“With price compression, agents selling long distance at 3-cents per minute and a 10 percent commission have to sell 10 times as much as they used to,” says Sharp. “Conferencing is still a high-margin sale. It allows them to sell less and make more.”

Service providers reported commissions for agents in the neighborhood of 10 percent to 30 percent and net margins for resellers of around 20 percent to 30 percent depending on services sold.

Resellers generally were offered second line customer support, billing feeds or private-label billing, branded operator and web services, and marketing support.

As an example, McEleney says Genesys offers mid-tier and top-tier telcos a turnkey service that can be up and running in five weeks. He says the program dovetails into their operations with functionality such as a hot-transfer among customer care groups.

Gentner Conferencing’s director of conferencing services Kevin Davis says a critical component of its reseller program has been the company’s ability to mimic the billing feeds for the telcos that resell its services.

“We ask them what they want the billing feed to look like and most all of our resellers have a customized billing feed,” Davis says.

In an interesting twist, NetworkIP offers its prepaid services, including conferencing, on a wholesale basis exclusively to other companies that brand them as their own.

Resellers request a batch of account numbers to which they assign product feature sets, e.g. conferencing, long distance, etc., says CEO Pete Pattullo. Since the products are prepaid, there is no charge to the reseller until customers start using the services. (As a bonus, resellers keep the breakage.)

Agents typically are offered sales training, marketing support and account/commission reporting. For example, InterAct Conferencing offers agents ready-to-publish marketing materials on CD-ROM. The company is developing an agent website, which will be live this quarter, for tracking customer and subagent activity.

In another example, Gentner assigns its own internal sales representatives to team with agents to set up the accounts, train new customers and drive usage across the account.

One-Stop Shop

Premiere Conferencing’s Sharp notes her company’s recent addition of the ReadyCast webconferencing product to its flagship audio conferencing services allows the agent or reseller to offer a client multiple solutions to meet the needs of its various internal departments. Investor relations might prefer an operator-assisted conference, while sales may want the convenience of an automated, reservationless service, she says.

ACT Teleconferencing’s executive vice president of sales and marketing Emily Magrish agrees. She says it’s important to be able to sell to the application. “Today, they might want to have a small group webconference because they need application sharing and document annotation,” Magrish explains. “Tomorrow, they might need to broadcast a message with a [Microsoft Corp.] PowerPoint presentation to 5,000 people [via streaming audio or video].”

Genesys’ McEleney says that in addition to meeting varied needs of an end user organization, one service can be positioned to drive usage for another. For example, he says that Genesys Meeting Center’s new unlimited monthly subscription plan for webconferencing will drive usage of the integrated audioconferencing service, which is priced on a per-minute basis. (In this case, webconferencing subscribers must use the audio portion to get the flat rate for
webconferencing.)

Providing a one-stop shop for partners and their customers was a common theme.

Says Gentner’s Davis: “[Channel partners] don’t want to have to go this company for reservationless and another for operators and another for streaming. They want someone that can do it all for them.”

Gentner’s services business has had a channel program since it started more than four years ago. The company offers a range of conferencing services to resellers and agents.

Most companies PHONE+ interviewed offer operator-assisted and reservationless audioconferencing as well as webconferencing. Some also offer streaming audio and video for webcasting and multipoint ISDN or IP-based videoconferencing services.


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