Comms Business Magazine Talks to Phil Donigan, Sales Director of Oxfordshire based reseller STL Communications, about their business and how Gamma’s new Converged Private Network (CPN) offering can benefit his business.
Comms Business Magazine (CBM): In a nutshell what does STL do? What are your principal activities?
Phil Donigan (PD): The company has transformed since it was established in 1995. Today we turnover around £6.0 million and whilst our headquarters is still in Witney, Oxfordshire we also have a London office that was established on the back of the success we gained in supplying services to the London 2012 Olympics.
Another change is that 70% of our revenues are recurring. The company is cash generative and profitable with a focus on Ethernet connectivity – we figure that if we sell the ‘plumbing’ we can also sell additional and more profitable services to the user as well. Ethernet is a sticky product, which means lower customer churn.
We are an aggregator of services and our principal partners are Gamma, Virtual1, and Entanet. We work with these suppliers as they all treat voice carefully – nothing goes over the internet and all have a Quality of Service. Today the majority of our connectivity is VoIP SIP rather than via CPS/Openreach. For voice over Ethernet we need to be confident we can see the whole connection. We learnt this by experience, having seen the pitfalls and learnt the way to do it right.
There will always be a place for the PBX – it won’t disappear in the medium term so of course we can still sell CPE systems if that is really what a customer wants. But our future lies in hosted telephony, Gamma Horizon being a big part of what we do. To date we support a base of over 1000 plus seats already.
High profile clients include Formula 1 teams Mercedes, Force India and Williams and we expect to make further announcements in that sector for the next racing season shortly.
CBM: What is it about Gamma’s CPN solution that will give you an edge over your competition?
PD: It’s MPLS with a different name, a private WAN service. Customers are likely to be businesses with remote locations or branch offices rather than home workers and the service is supplied over an uncontended Ethernet tail.
CPN is also being used for voice – it adds value, and any ISP we may use has to have an interconnect with Gamma for voice prioritisation.
We like Gamma and have a significant spend with them. We enjoy working with them, the relationships are well established and they make everything simple.
The edge comes from dealing with a single supplier for voice and connectivity. A single point of provision and billing plus as we are buying voice and data services from a single supplier it provides us with confidence should anything go wrong there is no ‘finger pointing’. Without that it is so easy for deals to suddenly become unprofitable.
This is a relatively new product for Gamma so it is good to see the familiar all around, single point of contact, people and support systems we know and integrate with such as the Gamma portal for example. Gamma has had a lot on its plate during its floatation but I have to say from a reseller’s perspective their eye never came off the ball and it was business as usual.
CBM: How does Gamma’s CPN solution address current challenges experienced in using another supplier of a WAN service?
PD: WAN sales are a growth area for us – it’s not high margin but it is a conduit for other high margin services and in the past we did use Griffin before their sale to MDNX.
Based on Ethernet it should not go wrong and we love selling products that rarely generate fault calls. We provide all the support internally so just love reliable products.
As I said before, it’s a sticky product that enables us to leverage higher margins. Because it is not an easily portable product it is harder for customers to leave us, and because it is based on Ethernet with an SLA everyone is happy.
CBM: How do you see the overall comms market right now?
PD: The market is changing faster than ever. We believe the future of the channel lies in connectivity but it is also about delivering it in different ways; for example, Wi-Fi, which we predict will overtake fixed cable.
The market is driven by improvements in performance, reliability and the cost of fibre. Total focus needs to be on Next Generation technologies and owning the pipes.