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Rolling Out Services Effective Launch Strategies For Rapid Takeup. Rich Grange President & CEO – New Global Telecom www.ngt.com February 13 th 2004. VoIP Services Experience. We have been in the managed network services business for over 10-years
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Rolling Out ServicesEffective Launch Strategies For Rapid Takeup Rich Grange President & CEO – New Global Telecom www.ngt.com February 13th 2004
VoIP Services Experience • We have been in the managed network services business for over 10-years • Over 3-billion minutes of traffic switched per year • Recent extension of technology platform with VoIP • Successfully offering a managed, wholesale VoIP service to Service Providers in a variety of vertical markets • Deep experience with new service deployments and market adoption in the telecom space – including VoIP services – has provided insights & ‘lessons learned’
What The Analysts Say • $15.1b VoIP equipment market by 2007 – 44% CAGR [IDC] • $11.3b VoIP services market by 2007 – 27% CAGR [Gartner Dataquest] • VoIP line shipments to exceed TDM line shipments in 2005 – one year away[Gartner Consulting – refer to chart] Traditional Key, PBX & Centrex IP PBX & IP Centrex “By the end of 2007 traditional enterprise telephony system manufacturers will have ceased development … and announced their intention to discontinue support for their TDM-based PBX and contact center systems within 5-years.” Gartner Group - 2003
What The Market Data Shows • IP PBX line shipments are up • Grew 1.4m in 2003 and • Will grow another 1.9m in 2004 to 3.3m for the year • TDM PBX / Key system line shipments are down • Fell 1.3m in 2003 and • Will fall another 3.2m in 2004 to 7.8m for the year • Cisco has shipped approximately 2m IP phones – over 1m in the past year • Over 10,000 IP telephony customers worldwide
What The Market Data Shows • Vonage is “the fastest growing phone company in the U.S.” • More than 90,000 lines in-service – and adding more than 10,000 lines per month • Completes over 4 million calls per week • Cbeyond installed 10,000th customer in January ’04 • Processed 1 billionth VoIP minute – within 3-years of network going live • 30% of new customers emanate from existing customer & partner referrals
What NGT’s Primary Research Says • 89% of SMEs have DSL or higher-speed Internet access today – and 58% have T1 access SME – Internet Access Services (% of sample) Dial-Up – 11% DSL – 25% T1 – 58% Cable Modem – 5% Fixed Wireless – 1% Source: New Global Telecom conducted over 300 telephone interviews with SMEs nationwide and 70 online interviews with Service Providers nationwide
What NGT’s Primary Research Says • 47% of SMEs expressed strong interest in an IP Centrex package offering 15% cost savings • Another 25% “may be” interested • 72% of SMEs with T1 access expressed interest SMEs – Cost Savings Required to Generate Interest (% of sample) % Interested at 15% Interested at 20% Interested at 30% ‘May be’ Interested at 15% Interested at 25% Interested at 30+% Source: New Global Telecom conducted over 300 telephone interviews with SMEs nationwide and 70 online interviews with Service Providers nationwide
What NGT’s Primary Research Says • Service Providers view VoIP as a revenue generation accelerator and competitive weapon Service Providers – Important Reasons to Offer VoIP Services (% of sample) Drive additional revenue Provide converged services Gain competitive advantage Acquire SME customers Acquire residential customers Acquire enterprise customers Minimize customer erosion % Source: New Global Telecom conducted over 300 telephone interviews with SMEs nationwide and 70 online interviews with Service Providers nationwide
Your Strategy – Which Markets? Consumers Secondary line broadband phone service for LD calling, Vonage, 8x8 SME Primary line integrated voice & data access, Cbeyond, ICG, Z-Tel SME or Enterprise IP Centrex / Hosted PBX, GoBeam, Level3, M-5 Vertical Applications VoIP-enabled, Bulldog, Norstan
Launch & Acceleration Planning • Key considerations for IP Centrex service – 1 2 Delivery to SME end-customer Your readiness
Delivery & Support to End-Users Delivery & Support to End-Users Network & Facilities Back-Office • POTS features • PBX features • Foreign exchange DIDs • Optional services (e.g. LD, network voice mail, integrated messaging) • LAN / WAN evaluation • End-user provisioning (including local loop, Internet access, application server seats, etc.) • Sales activities • Marketing support • Tier 1 / 2 Customer Service support • Billing • Applications server element monitoring • Staff training • Contract & forms design & development • Provisioning & support of select elements – • DID service provisioning • Gateway provisioning • Local Number Portability • 911 updates • CALEA • Applications server support • Support of network servers & firewalls (e.g. NAT traversal, DNS, POPs, media & network servers) • Planning & network component support (e.g. Engineering & design, PSTN gateways, network readiness assistance) • Network element monitoring • Local loop to CPE • Routing • Gateway links • DID inventory • Internet access
Delivery & Support to End-Users “Station Review Form” (Features by Telephone Set)
Delivery & Support to End-Users • Technical support has to be well organized and smoothly delivered – or else you’ll spend too much time (& money), and customers will loose confidence quickly • LAN evaluation • Firewall considerations – are they SIP aware? • IP addresses – public or private? • SIP phone power options – inline or local? • LAN utilization – VLAN options • WAN evaluation • Bandwidth considerations • Voice codec selections • QOS needs • Traffic shaping
Delivery & Support to End-Users • End users need to feel comfortable making the decision to go VoIP – your credibility must be high and you must touch prospects / customers in the right ways • The Sales process – • Direct or indirect channels ? • Provide very clear & simple financial input – consider an interactive ROI tool • Keep it simple Focus on a limited set of high-impact service features – not the entire range of capabilities, but some of the most powerful & sexy functions • Real-time feature demos & case studies are well received, very helpful sales tools • Do not overwhelm prospects, you’ll confuse them before they understand your pitch • Sell service and benefits, not the technology – all that’s important is what VoIP does for their business, not VoIP itself
Delivery & Support to End-Users • We need to draw an important distinction between delivery of IP PBX functionality and ‘trunk replacement’ (i.e. PSTN trunk connectivity) • The drivers for IP PBX – such as outdated or fully depreciated Key / PBX systems – means that < 20% of SMEs might be in the market for new service at any one time • Of course, there is always a portion of the market interested in new functionality as well • Trunk replacement, on the other hand, is a more straight-forward cost-savings proposition that can be interesting to all SMEs at any one time • Trunk replacement service can expand your market opportunity by over 5x - and, it provides an entry point into customer environments
Your Readiness Delivery & Support to End-Users Network & Facilities Back-Office • POTS features • PBX features • Foreign exchange DIDs • Optional services (e.g. LD, network voice mail, integrated messaging) • LAN / WAN evaluation • End-user provisioning (including local loop, Internet access, application server seats, etc.) • Sales activities • Marketing support • Tier 1 / 2 Customer Service support • Billing • Applications server element monitoring • Staff training • Contract & forms design & development • Provisioning & support of select elements – • DID service provisioning • Gateway provisioning • Local Number Portability • 911 updates • CALEA • Applications server support • Support of network servers & firewalls (e.g. NAT traversal, DNS, POPs, media & network servers) • Planning & network component support (e.g. Engineering & design, PSTN gateways, network readiness assistance) • Network element monitoring • Local loop to CPE • Routing • Gateway links • DID inventory • Internet access
Your Readiness A considerable amount of planning should go behind your choice of anApplications Feature Server • Vendor selection (Sylantro, BroadSoft, VocalData, …) • Redundancy • Element monitoring / NOC capability • Gateways • Deployment • Capex • CDR / billing
Your Readiness Back-Office Provisioning & Support
The Role For A Managed Solution 6DegreesIP is an example of outsourcing VoIP elements to achieve manageability, scalability and to gain experienced voice support for effective service launch & rapid takeup
6DegreesIP Product Evolution Sample of 6DegreesIP Product Roadmap functionality currently on the drawing board - • Portals for Service Providers and end-users • Billing solution & back-office support • Troubleshooting tools • Phone / gateway configuration & change management support • Web visibility of order status • Prepaid calling card platform • Vertical market packages
Rich Grange President & CEO – New Global Telecom Rich.grange@ngt.com www.ngt.com