FIXED LINE FETISH

Jonny White, head of fixed line sales at Micron Talk

Keith Horsted, mobile services manager at Nine Telecom

Many mobile dealers have not yet moved into fixed line, stating it is too complicated compared to what they already do, just a headache with little profit, or requires a lot of investment before sales are made, which negates making the move worthwhile. However, many are and have made the move, or are helping mobile dealers move into fixed line. Heather McLean reports…

We are not on our own here; the recent moves into fixed line by the major networks and the moves of other fixed line companies into mobile suggest this is an opinion that is shared. The trick will be to convince customers who historically seem to have been reluctant to buy fixed line and mobile from the same supplier,” Pryer continues.

Chess firmly believes there is a drive towards the development of organisations that provide all a customer’s communications needs, which Pryer terms communication supermarkets.

He explains: “This is driven by two main forces. Firstly a desire to save cost on the customer’s behalf through a reduction of their supplier base and an aggregation of their total comms spend to increase their buying power. Secondly, by the increased overlapping of converged solutions so that makes it increasingly likely for people to buy a complete comms solution from one supplier.”

Reluctant dealers

Yet mobile resellers have been reluctant to move into fixed line, as it requires an initial investment that can be substantial. Keith Horsted, mobile services manager at Nine Telecom, claims it is true that compared to the lure of large upfront commissions, fixed line business appears to require more work for less money.

“The reality is that fixed line simply requires a different approach, one that is based on a continuing revenue stream rather than an upfront payment; that’s the most difficult concept for most mobile dealers to grasp. It is human nature to be attracted to the short term reward, but in doing so the mobile dealer is vulnerable to becoming a network addict, with little control over his or her own livelihood.”

However, Ronnie Nag, managing director at Quore, says those dealers are looking at the area from a negative point of view. He explains: “I feel that’s a very naive way of looking at it. You have network operators looking at this

space, and this is an area that operators are gunning for, so if you are a mobile partner not looking at fixed line you might as well shut up shop and go home.”

Why bother?

Daniel Fuller-Smith, sales manager EMEA at Toshiba BCD, states selling both mobile and fixed line is important: “Many businesses deploying mobiles have the need to integrate them into business telephony. With more and more services becoming available, such as the ability to fork a call onto a mobile phone and the desk phone, customers are looking at the bigger picture of telephony, rather than considering fixed and mobile as separate issues.

“The ability to talk to a customer about fixed and mobile issues allows the reseller to position themselves as a complete solution provider, which is reassuring for the customer,” Fuller-Smith continues.

Nag states: “It’s always good to have a portfolio or suite of products for your clients; we offer a comms wrap all around telephony, which means it’s harder for clients to walk away. In today’s market it is even more so about a wrap covered by a strong SLA.”

Matthew Lambert, sales and marketing director at Uniworld Communications, comments: “Moving into fixed lines is a good idea for mobile dealers who are seeking to build additional revenue streams for their business for a number of reasons. The fixed line market tends to be less subject to customers switching than the mobile market, and this provides assurance of revenue for the future.”

He continues that dealers do not have to sell just analogue lines, but can promote IP, data connectivity and IDSN connectivity. “These services generally carry healthier margins,” Lambert says. “The market consists of far more than just analogue lines. Mobile dealers can easily sell lines for data connectivity which still carry high margins. And also, the telecoms market is moving towards converged access for voice and data traffic, and mobile will form part of this process.”

How to sell

Yet mobile dealers are increasingly moving into fixed line and beginning to offer value add distribution, such as sales support and installation, notes Fuller-Smith. He adds that this opens up new opportunities, without the need for full commitment to selling fixed line solutions.

Fuller-Smith continues: “Mobile dealers can integrate fixed line solutions into their portfolio by working with fixed line resellers as they begin to sell PBXs. Quite often the fixed line reseller can install and maintain a system until the mobile dealer has the volume or confidence to do it themselves.”

Significant levels of investment simply are not necessary to enter the market, agrees Lambert. He says for a mobile dealer looking to move into selling fixed line, the best solution is to work with a reseller that has already built billing platforms, can offer whitelabel billing and services, can provide sales and marketing support and that has a strong track record in fixed line.

Chess understands that for many mobile dealers, fixed line services are outside their core product set, so it has set up a team to make it easier to sell fixed line services into a mobile customer base, while still getting the upfront rewards the mobile channel is accustomed to.

One company that sees this from the opposite perspective, where mobile is harder to get into than fixed line, is Micron Talk. Micron Talk was established two years ago, predominantly as a fixed line communications reseller. However, clients were quick to start asking for additional services such as broadband and mobile. The business has used both whitelabel and a commission-based model to address this requirement.

With its start in fixed line, Micron Talk initially looked at mobile as being the complicated, low margin option. Jonny White, head of fixed line sales at Micron Talk, explains: “Fixed line can be complicated, but it can also be simple, depending on the space you wish to trade in. For the relative novice, I would suggest starting simply with like for like transfers and move forward from there.”

The best way to start in fixed line is with someone holding your hand on a whitelabel deal, adds White, at least until the customer base is large enough to warrant cutting out the middle man. Yet White adds: “If the ultimate plan is to run the whole empire inhouse with your own billing platform, why not do this right from the start when you’ve only got a hand full of customers to worry about? In which case, spend your time looking for reliable service providers with credentials which match your ambitions.”

Daniel Fuller-Smith, sales manager EMEA at Toshiba BCD

Warren Pryer, sales director at Chess Telecom

Space invasion

As to which group of dealers have the easier job here, Fuller-Smith comments: “Fixed line dealers are making the move into mobile more easily than mobile dealers are finding the moved into fixed line, because fixed line can be complicated compared to mobile products. This does mean that dealers that fail to expand their offerings will find margins squeezed as they struggle to differentiate in years to come.”

Horsted agrees: “In my opinion, it is easier for fixed line dealers to make the move into the mobile market than the mobile dealers moving into fixed. Not that it is more difficult, it just seems that fixed line dealers appear to be more receptive to new ways of thinking and do not have an expectation of upfront commissions, which seems to be a major barrier to the mobile dealers.”

While Pryer comments: “It’s hard to say fixed line dealers are making the move into mobile easier than mobile dealers are finding the move into fixed line. Certainly from what I have heard about the efforts of the major mobile networks to move into the fixed line space, they are not finding it easy. The main challenge we face is convincing mobile dealers that fixed line is worth the effort.”

However, Lambert adds: “It is our experience that there’s little difference in the ease of market entry for fixed line or mobile dealers moving into the alternative space. Fixed line dealers have the challenge of building credibility and the mobile dealers need to build confidence in selling fixed line telecoms.”

Ed says:

What are your views? Is fixed line worth going into? Have you tried and failed, decided it wasn’t worth the effort, or made a great success of it? Let me know. n