Pareto and bandwidth

According to Om's article about P2P and Broadband Usage, Arbor Networks data shows that Pareto's Principle works:

On fixed and mobile broadband networks where consumer services are provided (i.e., NOT interprovider or typical dedicated Internet access for commercial enterprises):

• 10% of subscribers consume 80% of bandwidth.
• 0.5% of subscribers consume about 40% of total bandwidth.
• 80% of subscribers use less than 10% of bandwidth

How to deal with the 20% is the problem ISP's face. Comcast throttles P2P, which is about 20% of the traffic. Video is another big chunk. Caching can help a little. And no one wants FCC mandated network management rules. So what would be the answer?

The commentors across the web expect the bandwidth that is purchased. Apparently, none of them have designed, built or managed a network. Every network - even your home LAN - has a finite bandwidth. (Think about your own inside wiring in the house - for many it is so poor that it cannot carry the 100MB or the 1GB throughput that many homeowners want). Even HPNA taps out at around 50MB. There are bottlenecks in every network. Remember the busy signals when AOL stopped billing by the hour? The network wasn't built for that kind of usage. Just as the Internet is not really designed to carry real-time traffic such as voice and streaming video.

One management suggestion is to fire the 20%. No rule says you have to supply them with basically a dedicated line. (I would suggest adding that to any TOS and AUP you offer, just to spell out what exactly the service you provide is). Some ISP's have turned back to metering. This may be an answer, but it's like the cell phone owner who gets the crazy bill one month. In the old days, if you called international, you would get a huge charge from your LD carrier (at&t, mci or sprint) - and call them yelling. It would happen when the grandkids visit or they try to download a movie that takes 5 tries and ends up eating up 20GB. There's no one answer, except that the FCC should mandate. Use the FTC to enforce Truth in Advertising.

CRM, VoIP, CLEC's -- too many

There was an announcement in TMC's Internet Telephony magazine about Vonage integrating with FreeCRM. Broadsoft already developed hooks into Salesforce. Simple Signal has a hook for ACT! By this point, if you are a VoIP Provider and do not have CRM integration, you are behind the times. (At least that's what the trend in the market will have you believe).

But not every provider chases the same market. Certainly Vonage with their low cost (and unprofitable) service chases everyone. So does Packet8. This reminds me of the early days of DSL. Rhythms, Covad and Northpoint rolled out nationwide, competing not only with each other, but with CLEC's and RBOC's. They didn't win.

VoIP Providers today are in the same boat. They are selling an undistinguishable service nationwide to everyone. Meanwhile, cable companies are winning the consumer battle in VoIP and soon will launch into SMB Voice, which because of bundling, market power, advertising might, and QOS, will likely even de-throne some CLEC's.

CLEC's have had a similar issue. (And if you read my stuff, you know that I b!tch about this often. There isn't much differentiation to what CLEC's offer. What's the difference if you get an Integrated T1 from Nuvox, Paetec, TWTC, or XO? I have no idea either.

Weekly, Paetec looks more and more like XO. What are we today? Wholesale? Retail? Whatever. As if $1B in revenue means success. XO is at a billion. Are they a success? :) Intermedia had $1B in revenue, before their short term debt and minimal margins caught up to them. And having Paetec merge with USLEC, then buy McLeodUSA and Allworx, just to reach a billion... who's dumb idea was that? At the end of the day, it is about the Brand and Profits. Most companies in telecom don't understand or have a Brand. Or think they do, when in fact the marketplace doesn't know what it is. (And a brand is not a logo or a new name. A Brand is how the marketplace perceives of your company. Indifference or Unknown is not a pretty response).

VoIP Providers come in many flavors. And many of them wholesale and retail. Does that model really work? I have not seen it work with Level3 or XO. Starbucks doesn't sell wholesale, do they? How about Wal-Mart? Nope.

I know why VoIP Providers go wholesale: It's very expensive to do retail and there is this hope that if you get more companies selling your product it will grow. That rarely works out. Consumers on DSL don't really need VoIP because the DSl comes with a landline. So get your partners to sell to their Business DSL accounts. Most ISP's have less than 1000 broadband subs. Even at a take rate of 15%, that's 150 VoIP customers. But it rarely works out that way.

Going forward, VoIP Providers will need to start to market to verticals with a specific feature set. This will be a specific marketing strategy per vertical. It makes the messaging easier - and the WOM (word of mouth).

As an aside: CRM isn't used by most companies. Sure, there are many CRM apps available, but who uses them? I work with many small businesses and most do not use CRM. They use Outlook. Where's the TAPI hooks for click-to-call for that? On-screen CallerID? Where's the move to integrate with Apple?

I see more businesses going to a call management system like Google's GrandCentral than looking for VoIP or Unified Messaging. But these are just my thoughts. What are yours?

Businesses Buy Storage

There is opportunity in Data Storage. Get a partner like DPS or RBS or someone else - and upsell your customers.

"According to a study conducted by Access Markets International (AMI) US medium sized businesses (companies with between 100-999 employees) will be investing up to $7.8 billion on data storage and security in 2008 — an increase of 12 percent over 2007."

"Data backup is critical to any business and most (near 90%) of medium sized businesses utilize data backup and data recovery software. Stats from AMI and other analyst groups placed storage and security investment to be around 7 to 10 percent of the total IT spending in most medium sized companies."

"AMI’s study also shows that on, average the U.S. MBs spend about $4,900 on SAN (server attached storage) solutions and 20 percent purchased this technology in the last 12 months. MBs tend go to their trusted channel partners/VARs/IT consultants for storage related solutions. About 85 percent of MBs said enhancing IT security and privacy is the top IT strategy for the next 12 months."

Uptime Expo

"Uptime Institute Symposium , Orlando, Florida, April 27th - 30th, 2008 - is the only all-industry gathering focused on the short- and long-term approaches to energy efficiency, reliability, and availability in the uptime industry. Symposium 2008 marks the third year in a row that the Uptime Institute has brought together all industry stakeholders to develop an industry-wide perspective on energy efficiency in enterprise computing and set the agenda for the industry. For More Information Click Here...

7x24 Exchange - Baco Raton, Florida - June 1-4 -7x24 Exchange is the leading knowledge exchange for those who design, build, use and maintain mission-critical enterprise information infrastructures. 7x24 conferences improve end-to-end reliability by promoting dialogue among these groups as well as providing 20+ sessions per conference. The upcoming conference features 12 sessions on the topic of data center efficiency. For More Information Click Here...

Virtualization

It's not just a buzz word that is floating through out the media and conference world. Virtualization is big for two reasons.

On the data center side, power (and collong) is becoming a real issue. Many data centers are bottlenecked by power limitations. (See what Google and Microsoft are doing about it!). It used to be space back when a box was 7U. Now everything is 1U.

On the app side of things, virtualization means less hardware costs upfront. Most companies like having the server where they can see it. But as IT talent gets more expensive and harder to retain, companies will be looking to move to a DC. But Data Centers don't want shelves with white boxes and Joe Business doesn't want to buy a new one. Plus will I need to firewall that off? Do I need an IDS? Do I want shared bandwidth or just my own feed? Virtualization and Managed Services. You are selling Peace of Mind; Remote Hands; Talent on-Demand.

Project Management

Having worked on committees for ISP associations like FISPA and WISPA, I can tell you that email and listserv usage make for a really challenging way to run a project. Now that I am in Chicago managing an MPLS migration, I realize that Microsoft doesn't have decent tools for this either. Outlook and MS Project help to schedule stuff and create a 1MB file with the timeline, but when you want to look at spreadsheets or other docs, it's still a cumbersome project.

I have used a Wiki, which wasn't perfect but it beat using MS Word and its version machine.

Yahoo Groups is a little better because the listserv, emails, archive, files are all right there. Y! is a pita to get people without Yahoo emails signed up though. And it still doesn't do anything for document version management. Collaboration is a tough thing.

Emily Chang's Hub points out new apps every day. (LifeHacker.org and SarahinTampa.com points them out too). Emily has pointed me to STIXY, which is an online collaboration tool. (Free in beta). The invite people and version management are good. The GUI is like setting up Blogger.

Another one that I have not tried yet is HomeCourt. The app supposedly answers: Who is responsible for what; who said what and when; and where are the files for this project. Not all of it, but the responsibility part is pretty important, not just for CYA, but to find out who is holding up the project. Time is money.

PMP is a big certification in the last 3 years. However, it is mainly about how to create a ton of documentation. As someone not used to that, it is a cumbersome process (and truth be told, I can not figure out why you would have to spend so many hours just to deliver more status reports.) But the project detail docs are where the gold is. Explaining what MPLS is and why it was chosen. How will it be integrated into the current network architecture. Define Class of Service; VLAN's; policies; IP Addressing schema; diagram the network and the NOC. These are documents that many data centers do not have. I can see why they don't (too many man-hours to produce) and why they should (easier to "franchise" the business. IOW, it is knowledge that you want to preserve in your business. When Dan leaves (or dies), what happens to all the knowledge about your network, your gear, your customers???? Gone. How do you replace that? Hence, why documentation is an important piece. (It's still one big hairball to create, but becomes an asset to your business). Now go sell something!

Joel on Software Conference

Joel on Software is the owner of FogCreek Software and writer for a blog with a big following (including Seth Godin, who will be speaking at JoSCon). Joel is hosting his first Conference in Boston on Sept. 3-4. From th eagenda it looks like a conference for software dev shops - how to run one and how to market your software.

FBI Wants 2 Years

The FBI is back at it again, pushing lawmakers to have ISP's retain at least 2 years worth of data on customers. That is a LOT of data. Read the details at DSLReports.

off topic

I'm watching the Rodney Dangerfield 75th Birthday Roast on HBO. Two things come to mind:

1. Rodney was one funny comic.
2. In life, it's about moments. Surround yourself with family and friends. Enjoy life.

Zig Ziglar says that you can get everything you want out of life if you just help enough people get what they want.

If you are coming to ISPCON in Chicago on May 13-15, let me know. We are having a group dinner on Tuesday night. And Wed. night there is a special event before the CEO Exchange (which was moved to 8:30). Email me for details.

Corpus Christi Kicks ELN Out

In the wake of putting for sale signs on its Muni Wi-Fi business and its access/ISP business, EarthLink was kicked to the curb by Corpus Christi last week. ELN just finished building the network out in August. As WiFiNews points out, when kicked out, ELN saves about $1.5 Mill -- And Rolla is counting every penny. Every penny counts to make ELN sellable.

Another Free Switch

Asterisk has a firm place in the market, especially for end user devices (like Aastra's new key system, the AastraLink Pro 160; Fonality; SwitchVox, and the like). In addition, there are service providers who offer managed services (like Hosted PBX and managed phone systems) based on Asterisk devices. Now there is a new software platform for service providers to look at:

"Freeswitch is a perfect platform for CLECs to deploy innovative new applications like conferencing and voice mail." said Ken Rice, developer and user of the system. "We took out a Tier-2 carrier's $1 million switch because a couple of our Freeswitch boxes provided too much call volume at one time." This is an astounding statement of the performance of this system. The group claims that the software has been tested for 100 hours to over 10 million calls without crashing. "One of our switches has 2500 call legs and it's using a single Dell 1950 and the memory and processor utilization is only about 10%. It's doing 80-100 call setups per second," said Rice. [source]

Om mentions that it doesn't so much as compete with Asterisk (which was never designed to be a softswitch) but replace it in the carrier softswitch space.

An interview with the founder of FreeSwitch.

Peering Failing Already

We have seen Cogent have peering disputes with Level3 and Telia. There are scuffles regularly, usually around the size of the peering point.

With the mergers of MCI+VZ and BST+AT&T+SBC in 2005, conditions were made about maintaining the status quo on all peering connections. However, it was a three year term -- and unlike most telco contracts, this one doesn't auto-renew. Already AT&T is re-negging on its peering inter-connection with, not some small guy, but with Sprint. Read it here.

DNS Re-direct Hole

Many ISP's including cablecos, RBOC.net, and ELN, use DNS Re-direct services. It is a small way to monetize a network. ELN uses Barefruit, which is a company I repped for when they tried to launch in the States.

Users don't like it because they think it muddles their "clean" connection.

Domain owners hate it because it messes with their income, since many of these guys own 200,000+ domains including misspellings of common names and URLs. These folks want to keep the money on the re-directs, not let the ISP's have it.

The one group (other than the ISPs) that likes this system is the hacker community. On DSLReports, read about the hack that lets phishing sites work. The Washington Post blog has the full explanation. [Note that Barefruit has already fixed this flaw.]

Sales Leadership

One of the things I get calls about most often is Sales Leadership. In other words, how do I get my team to sell more, close more, bring in more business?

There are 2 keys to sales leadership: a sales process and a sales coach.

The sales process is a series of steps from lead generation, to pre-qualification, to proposal, to close. The best sales people have a process and a set of open ended questions that they use during the process. It is a Process - a system of steps to follow.

The other key is the Coach. Great athletes have coaches. Tiger Woods. Andre Agassi. Why not sales people? The problem arises in that not only are most people untrained to be a sales manager; they are untrained to be a Leader or a Coach.

Luck for you, my sales coach, Keith Rosen, has written a book on how to coach your people to be champions. Every coach has a playbook -- this is Your playbook to coach your team. The book, Coaching Salespeople into Sales Champions, is available starting today! And if you buy today you get a bunch of bonus material including my video, 50 Ideas in 50 Minutes. For $20, you get the playbook to better sales performance as well as 50 business ideas to fine tune your shop. Get it today!

You can even download a few excerpts from the book here.

Another VoIP Casualty

deltathree was delisted from Nasdaq last week. deltathree has a $5.2 million quarterly loss. deltathree has been around a while as an original wholesale VoIP provider. Once again proving that selling below water means you eventually drown.

What's really shocking is that I was under the impression that VZ's Voicewing service was provided by deltathree. Maybe they lost that.

Phone+ states that d3 spent a year making JOIP for Panasonic. It lost focus. Not a good thing to do in this market. d3 mentions that its differentiator is that its international. If you don't have a foothold in one market or vertical, why would you think spreading your marketing message across the globe would be effective?

8x8, Vonage, and Primus/Lingo are all in the same tank as d3.

Kelly at Phone+ ends the article by asking: "The fact is, pure-play VoIP is not the money-making messiah the industry once believed it would be. The unanswered question is how will providers differentiate themselves and become profitable?" That's the problem! They have NOT differentiated themselves. It's all the same bull -- I'll save you 10%! That dog won't hunt any more.

Power Up

Entrepreneur mag has an article about the many ways road warriors can power up, including the PowerStick (pictured) from Ecosol.

Blogging at TMC

With my limited free time, I have been unable to blog. And there is so much going on too. So I have some posts over at TMCnet, On RAD's RADAR:

• Microsoft Response Point
• Digital Life (with no insurance)
• Landline Slide
• OpenID

$500M for CALEA?

From the Wired blog:

The FBI has gone through nearly all of its $500 millon budget for making old telephone switches wiretap friendly, but an FBI survey showed that nearly 40 percent of the nation's switches still aren't up to federal wiretapping standards, according to a new report from the Justice Department's inspector general.

I have no additional comment.