Channel gets it shot at Video.

by Larry on January 26, 2012

Trade-show season is great for re-connecting with key trends, particularly from a vendor and channel perspective. Major trade-shows, at least in telecom, increasingly bring together makers and sellers, more so than sellers and buyers. This is not a bad thing altogether; as so many sell to traditional SMB’s these days, filling a room with qualified buyers is tough — and frankly, industries like ours need events that force makers and sellers to connect real time, face-to-face.

But back to my original thought. As we lead up IT Expo in Miami (including to EMBRASE’s own StartupCamp), and recover from that little event called CES, news and product announcements are everywhere. Videoconferencing, visual communications, video collaboration or plain old video calling – whatever you want to call it  - is again at the forefront. I say again because for those who have cared, video conferencing has never slacked at creating news. Creating revenue maybe, but not news.

But these days, news seems to be about revenue, and revenue not just for vendors but sellers too. For clarity, we’re talking about business video. Yes, the consumer stuff rolls on (see CES-type news on companies like Biscotti and Tely), but my focus here is on video-related conference and collaboration solutions’ long-last migration to the channel.

By all accounts, fabulous growth continues for those in the legacy audio-visual space. These folks paid their dues selling less than optimal video systems for years, and now have more work than they know what to do with. But what about the telecom channel? Every year at major industry conferences, for the last three or four at least, I ask this very question. Be it of the classic interconnect or of the more modern cloud-based service provider, I have pried to uncover whether video is or will be a revenue source. Up through last year, the answer has always disappointed me. But I often chalked it up to the distractions those sellers had in their core business, than as a true indicator of what was to come in video.

This year I expect different. No longer can the Hollywood-like projections about growth is video collaboration revenues be ignored,  no longer can sellers blame high CapEx costs as reasons to avoid it, and no longer do we lack end-customers who want it. A ‘video call’, too often confused as a more expensive Skype chat, is just so much more when done right. Perhaps then why the adoption of the more intuitive term, video collaboration. Enterprise-quality video is little like what we’ve become accustomed to online and offers a huge variety of applications and corresponding benefits. The channel was built by those who could spot a problem and sell a solution. Video offers this more than any new end-user telecom technology since the dawn of voice mail.

I used to preach, before video had any traction, that it made for the perfect way to invoke a sales discussion on UC. It probably still does, but with time and market evolution I now believe that what makes video attractive is it can be sold as a stand-alone. It’s benefits – again, way beyond just being a better voice call – are just not hard to understand. Unlike some of those in UC, where depending on the seller and buyer segment, can complicate a sale into paralysis at times.

Take a look of some these key drivers and news items. Stitched together, they make a pretty good case:

The Cloud: Yes, old news. But in video, not as old. Video’s been a premise play since day one which in effect can be blamed for the interoperability mess it finds itself in. Not only that, but as video already requires plenty of desktop equipment, the cloud and it’s low CapEx is critical for getting it down market. Vidtel, one of the first if not first to the cloud, is maturing nicely. Their platform and network make it easy to ‘rent’ video services for deployments of all shapes and sizes and – most importantly – totally dumb down the whole interop thing. Bring any end point you want, including the widely available CounterPath Bria series (see their recent announcement).

It’s this type of cloud-based approach that can deliver any-to-any video, a pre-req for huge growth and a term with traction. Imagine had you in the 90′s required an IT guy to make a cell phone call to someone with a Nokia handset  because yours was a Motorola. Players like CounterPath are doing their part to kill off this overhead , having invested heavily to work across all devices (ie. PC, Mac, all tablets, etc..).

PS. As a channel strategy guy at heart, I also appreciate Vidtel’s focus on enabling the channel, versus competing with them. Apparently, CRN agrees.

Giants have also entered the video cloud space: Cisco put out product that seems targeted at filling holes in the very small business space (harder to make money), while Polycom recently did the whole industry a favor by literally branding an acronym (VaaS), and in doing so giving service providers (larger ones I would say) a alternative for investing in bringing their own VaaS to market. As I don’t know these offers as well I do others, I can’t comment on just how elegantly they are solving the interop problem, except maybe to say that these guys do have a proprietary end point business to worry about.

Desktop/Room Equipment: When I was at BroadSoft Connections a few months back (great show, BTW), I was overwhelmed by the sheer number of desktop phones on display. In a time when so many have debated the end of the desktop phone era, 20 minutes on that floor and the debate seemed over. Both upstarts and legacy manufacturers are rolling out units daily that bring either the browser to the phone (??), or add video screens and cams to change what the phone stands for. Phone makers are good at selling phones and don’t make them for nothing. The channel’s great at selling phones, and lately, creative financing options with the vendors have turned phones into sources of recurring revenue.

Yes ‘video-phones’ (need a new term), can be pricey. But heck, if in the ’90′s we could sell voice phones for $700+ just because they had soft-keys and little screens, we can sell the lights out of these when packaged for the right application. And don’t discount room gear like that cool ModnoPad; give it the right salesperson and it will move.

The Soft Device: What’s a soft device? An Apple product that SMB’s are buying in absolute droves. Now, no, the channel will not get to actually sell iPads any time soon. Maybe other tablets, but either way their customers have them or will have them. And they need to be turned into ‘video communication terminals’ (still need new term). Avaya’s doing it, as is CounterPath Bria and countless others. The channel’s challenge (remember: where there is a mess, there’s money) is to integrate and somehow support these soft endpoints as part of the overall communication systems they sell. Managed Services, anyone?

As a channel, it’s hard to sell solutions that only address a minority of a given company’s users. Even when we were selling overpriced desktop phone to the 1%, we had trimmed down versions to sell to the other 99 (sorry, I couldn’t resist that one). In video, we need ways to do the same. Look for cloud providers that make it easy to bring disparate end-points into the solution (including even Skype). You can’t make money on those per se, but by offering company wide solutions it will be easier to sell the high-end stuff to the corner suites.

Security: Not my forte but clearly an issue for anyone concerned about breach of network, including many of the verticals video is targeting. Over the last few years, as channel has searched for new revenues, many of have become experts in security. Video is an opportunity to re-purpose these skills – and charge for them.

There’s more. But enough said for now.

Look, I know anything is much easier to write/say than it is to do. But having sold all my life – much of it in the channel – I know that nothing sells itself (except for maybe an Apple product). And I know that channel can’t afford to start selling next-gen product until at least some buyers arrive. But — there’s always a small window, where stars align, to get good at selling something before everybody and their brother hops on. This early start builds loyalty and protects margins in the long term. Too many indicators suggest that time is now for video. Channel, start your engines…

 

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