Over the last few years, there’s been more change in the UC industry than anyone could have predicted. We’ve seen countless mergers and acquisitions, the rise of new products and services, and a host of disruptive concepts coming in to alter the way we communicate.
The changing environment doesn’t just mean big things for service providers and customers; it also presents a range of challenges and opportunities for channel partners and resellers too.
Over more than 45 years, Mitel has concentrated on bringing state-of-the-art technology and communication solutions to businesses from all backgrounds. The company is currently number one for the UC market share in Europe and has more than 1 million UCaaS connections. Now, the Mitel brand is focusing on a new route to market, based on the master agent model. I caught up with Rami Houbby, the VP for UCaaS sales for Mitel in EMEA and APAC, to discuss the future of the brand.
Tell us About Yourself
Rami has only been with Mitel for a short while, joining the company at the end of 2018. However, he has a long history in the UCaaS space, working in leadership positions with NFON AG and BroadSoft. He told me that when he came to Mitel, he saw the huge potential that the company had in the UC and UCaaS space.
“The history and heritage of the company is phenomenal. When you combine the strength of the Mitel brand, with its exceptional market share of about 23% based on-premises UC technology where 1 in 4 handsets is Mitel, it’s easy to see there’s a lot of opportunity here.”
“In the UCaaS market, UCaaS is currently reaching 12% penetration, and I can see the Mitel brand achieving a leadership position in the UK”
According to Houbby, the current focus for Mitel is on growing their UCaaS proposition in the UK. Mitel has had a UCaaS solution available for a while, but Rami noted that the business didn’t have the right structure in place to drive growth. “My priority from a UK market perspective is to scale our sales and marketing engine. Our solutions are already proven and established; they just need to scale.”
As part of this growth strategy, Mitel has restructured their plan for their channel audience to suit a new “Master Agent” model.
What is the new Channel Partner Strategy?
Rami told me that today’s channel partners have two options. They can either continue what they’re doing, building the infrastructure for their clients, dealing with sales, marketing, and provisioning and all of those other requirements, or they can take a more simple approach. Mitel is offering an opportunity for channel partners to do all the relationship building on their side, then hand the customer over to the Mitel team for provisioning, billing and customer success.
“The partner focuses on the sales and marketing, and we take care of everything else, including the technology, and the solution that’s delivered to the customer”
“We think now that the market is moving faster than ever and partners need more agile options. We’re here to do the heavy lifting for them.”
The new channel partner strategy from Mitel is very straightforward. Mitel sells the solution to the end-customer, providing them with all the tools and implementation help they need, and the partner gets a recurring commission for as long as the customer is receiving the service from Mitel. This means that Mitel also handles all the provisioning and customer after-care too. According to Rami, some partners don’t even want to do the sales part themselves – instead, they just hand a lead over to Mitel and let the Mitel team do the rest. “We can close opportunities, do demonstrations, pass customers onto the customer success team and more.”
Do You Think This is Where the Market is Heading?
Mitel’s channel strategy could be described as “disruptive” compared to the traditional methods that channel partners would have used to sell telecoms solutions. However, according to Houbby, cloud is a disruptive technology itself. The cloud offers both opportunities and challenges to companies today, Mitel’s strategy to stay ahead of the curve is to be disruptive themselves, even if that means adjusting their own status quo.
“The market is moving rapidly. For partners who don’t want to move away from traditional methods entirely, they have the opportunity to embrace this strategy as a complementary model to what they’re already doing. There will be plenty of opportunities for them to engage customers with UCaaS and get ahead of the competition.”
In today’s market, Rami believes that business models need to evolve to remain competitive. Although older go-to-market methods may be necessary in some situations, it’s essential to have a future-focused path in mind too. “If you’re still stuck in the old world, now is the time to come and see what you can accomplish with UCaaS. Dismissing this new marketplace completely would be a mistake.”
Driving Enterprise Value
The street as well as private investors value businesses that have annuity-based business models with recurring revenue. Such businesses command strong revenue multipliers when it comes to evaluations. The perception has been that channel partners would need to be directly billing the end-customer in order to create value in their business. This is more of a myth than reality. Rami believes that “Money is money it doesn’t matter who pays it to the channel partners. Recurring revenue in the form of monthly commission paid by Mitel under the agency program has identical value and strong credibility given Mitel’s strong credit standing”.
How Can Channel Partners Evolve?
Houbby told me that sales organisations and companies today often feel restricted by their inability to execute on new opportunities because they don’t have the right resources. Everyone needs the freedom to scale and experiment with new things today, and the UCaaS partner model provides for that.
“There are new entrants to the market everywhere. Anyone can come in and start selling through the UCaaS route. Telecom traditionalists are missing out if they don’t embrace these new opportunities.” The resellers that do embrace the over-the-top cloud model can change their strategy and focus on marketing and relationships, instead of complicated OpEX-intensive activities like infrastructure, integration and support.
Rami noted that embracing the future doesn’t have to mean drastic staff changes but finding new ways for your techs to serve specific segments of the market, while you also unlock the opportunities of UCaaS.
“Whenever a big change arrives in the industry, people panic and feel like they’re losing control. However, the industry is changing rapidly. You can’t just ignore it”
