Duopoly Don't Want Net Neutrality

And in a surprise move carriers don't want any Net Neutrality stipulations on their broadband stimulus funds. Who would have thought? The surprise is that Content companies and Nashville's music industry (and Congresswoman) don't want to support NN guidelines.

Congress may have made its preferences for Net neutrality policies clear in the open access requirements included in the broadband provisions of the stimulus package, but the details of those requirements have yet to be drawn up. .... The stimulus bill President Obama signed this month includes $7.2 billion to promote broadband access, including $4.7 billion that will be distributed through the Commerce Department's National Telecommunications and Information Administration. Those particular funds come attached to a requirement that recipients must adhere to "open access" principles.

Wireless Fees to Raise Funds

Obama proposes new wireless spectrum fee on CNET

The Obama administration's proposal was loosely outlined in the new budget plan for 2009 and 2010 submitted Thursday. In that plan, the administration proposes adding a new fee to be paid by wireless carriers that license wireless spectrum from the government. ... These annual fees would start at $50 million in 2009 and jump to $200 million in 2010, Reuters reported. The fees will gradually increase over the next 10 years to $550 million per user per year, generating an estimated total of $4.8 billion over the next decade.

The NTIA is taking appointments according to Xchange magazine.

Companies that want federal grants for building broadband networks can schedule meetings with the National Telecommunications & Information Administration (NTIA) as of March 2. ... The NTIA is doling out $4.7 billion from the broadband portion of the 2009 American Recovery and Reinvestment Act. The Agriculture Department’s Rural Utilities Service will oversee administration of the remainder of the $7.2 billion total. ... The meetings will stretch over a period of days, until NTIA officials determine there’s been enough discussion. The substance of all of the talks will become public record.

Vonage Losses Mount

In case you were wondering, Vonage's latest financials show a loss that grew from $13.8M during the same period last year to $40.9M. (Depends how you calculate losses because they had like 3 numbers plus a cash flow positive number. Wall Street - no wonder we are screwed right now).

• Revenue did grow 3 percent to $222.2 million for 4Q
• Customer growth = net loss of 14,700
• "Churn declined to 2.9% per month in Q4 from 3% last quarter"
• ARPU is $28.33 per subscriber, compared to $28.75 in Q3.
• Revenue increase of 9% to $900M for the year
• How did revenue grow? With ARPU and net subs down??? New fees?
• "$31M in debt extinguishment costs" for the quarter
• "first year of generating positive cash flow from operations"
• how does it have positive cash flow while losing money???

"While marketing costs were down $3 million in the quarter, the "SLAC" - marketing cost per gross subscriber line addition - rose to $309 from $272 in Q3 2008. This is not good math, especially when net subscribers are down. (Take the ARPU number, multiply by 12 months, subtract SLAC, see red ink after a year once operational costs per subscriber are factored in)." [voip biz news]

Deltrathree closed up (bought by ACN). Now Vonage is in danger of de-listing in April. As Phone+ points out, the press doesn't even seem to care. But cable, telco, and cellular have the stranglehold on consumer voice, because bundles are easy to sell due to perceived value.

CPNI Paperwork Due March 1

Are you CPNI Compliant?

Have you filed your CPNI paperwork with the FCC? It's due on Sunday, March 1.

The FCC this week fined about 20 companies between $1000-$4000 for being non-compliant with CPNI paperwork and certification. For example:

EGIX, INC. Notified of its Apparent Liability for Forfeiture in the amount of $2,000 against EGIX, Inc. for filing a non-compliant CPNI certification with the Commission. Action by: Chief, Enforcement Bureau. Adopted: 02/24/2009 by NALF. (DA No. 09-372). EB [FCC Daily]

This from WISPA's president Rick:

The following document was released by the FCC on the matter of Annual CPNI Certifications which were not filed in 2008. This filing is required for all telecommunication providers carrying voice, VoIP and paging services on their networks. There is an estimated 600 companies who were penalized $20,000 for not filing for their CPNI Certification in 2008. The full release including the penalized companies can be found at http://www.fcc.gov/eb/Orders/2009/DA-09-426A1.html. [PDF version]

If you sell VoIP services, you DO need to file for this CPNI Certification by March 1st, 2009 to avoid future penalties next year. Here is an excerpt of who is required to file:

The term “telecommunications carrier” is defined in the Act to mean “any provider of telecommunications services, except that such term does not include aggregators of telecommunications services (as defined in section 226)[1]…”47 U.S.C § 153(44). Telecommunications service is defined in the Act as “the offering of telecommunications for a fee directly to the public, or to such classes of users as to be effectively available directly to the public, regardless of the facilities used.” 47 U.S.C. § 153(46). · Companies that fall under the definition and must file an annual certification include, but are not limited to: LECs (including ILECs, rural LECs and CLECs), IXCs, paging providers, CMRS providers, resellers, prepaid telecommunications providers, and calling card providers. This list is not exhaustive. · Interconnected VoIP providers provide a service that: “(1) enables real-time, two-way voice communications; (2) requires a broadband connection from the user’s location; (3) requires Internet protocol-compatible customer premises equipment (CPE); and (4) permits users generally to receive calls that originate on the public switched telephone network and terminate calls to the public switched network.” 47 C.F.R. § 9.3

The public release reminder that you can search for is EB Docket No. 06-36 with the title, "Enforcement Bureau Reminds Carriers of March 1 Deadline and Provides Further Guidance on Filing of Annual Customer Proprietary Network Information (CPNI) Certifications Under 47 C.F.R. §64.2009(e)"

The Commission’s rules do not require a certain form or format to be used by companies subject to the rule in filing their annual CPNI certification. For convenience and to assist companies in meeting the requirements of the rule, the Bureau provides the attached suggested template that filing entities can use to meet the annual certification filing requirement of 47 C.F.R. § 64.2009(e). [from the PDF] The one page template form to submit is on page 5 of that PDF.

March 23 Impact Session

On March 23, I will be doing a 2 hour session before the FISPA Meeting. It will be for 20 people only at $69 per person. There will be 3 topics:

• Streams of Revenue - how can you add one or two new streams of revenue?
• Does Direct Marketing Still Work?
• How to Upsell Your Current Clients

Why all the sales and marketing talk? Because you already have most of the technical stuff down pat. You have been offering DSL or wireless or T1 for years. Have you actively been marketing it? Are you out selling VoIP, managed services, back-up, Metro E, SAAS, security, hosting, hot dogs? If not, why not?

Why am I calling it an Impact Session? Because I am trying to Impact how you look at your business and your revenue.

We will brain-storm on some other revenue streams for 30 minutes, then we will talk about Marketing for 30 minutes. We will end with about 30 minutes on upselling followed by a Q&A. Just $69 for 2 hours.

AND if you register by March 6 at midnight, you get a PDF copy of my book SELLECOM with your registration. A $20 value up front. You can't beat that!

Are You Coming to Florida?

There are a number of events coming up in the next 8 weeks in Florida to attract tech folks.

• BarCampMiami and FOWA just ended in Miami.
• I'm speaking about blogging at the American Marketing Association's one day Web Strategies Summit on March 6.
• I am speaking about BarCamp at FACUG (Florida Association of Computer User Groups) on March 14 at 4:40.
• FISPA's Regional Meeting is in Orlando on March 23-24.
• VoiceCon is in Orlando on March 30-April 2 at the Gaylord Palms.
• Internet Marketing seminars on April 2-4 in Deerfield Beach, FL.
• MSPWorld at the Dolphin on April 30.
• BarCampOrlando is April 18.

I know it's hard to get away. It's time and money and time. But how else do you find out what other people are doing successfully? How do you meet people and make a connection that will stick -- that may affect your business or personal life going forward?

Fax over VoIP

The one thing everyone asks about in VoIP is FAX. Yeah, yeah. T.38. G.711. Blah. Blah.

If the entire VoIP network runs on a single platform built with Brooktrout Session Border Controllers, then fax will work.

Where does Fax over IP work? well, a short outbound fax will usually work with a fax port on a Edgewater device. But anyone that using a lot of fax should just stay with TDM. The other option is to move to a dedicated fax over IP provider. That's what CallWave just did:

CallWave Sells Virtual Fax Subscriber Base to J2 Global for $12 Million [TMCnet] J2 owns the original efax service.

There are other providers like Premiere Global Fax 2 Mail service that can be white labeled for you. (I rep for Premiere).

Why doesn't fax work well? Compression and Conversion. When you compress a fax packet, it destroys the image file. When you do conversion on the fax packet - like from G.711 to G.729 or analog to digital - it degrades. More than 15% degradation renders the fax unreadable. That is the problem. It has to have end-to-end quality of service. Most VoIP networks are not designed that way. More like duct taped pieces together.

ISP Lists Close

Alex Goldman, Managing Editor of ISP-Planet, says good night all.

It has been a pleasure for my brother and I to get to know everyone on these lists over the years that we have operated them. I am sad to announce that as part of the cost cutting measures to be implemented by WebMediaBrands, the ISP-Lists will shut down at the end of March.

I -- and many of you -- have learned a great deal from these lists and met people we would never have gotten to know. I look forward to remaining in contact you and wish all of you and your ISP associations all the best.

ISP-Lists.com and ISPCON are done, so I assume ISP-Planet.com is closing as well as Alex transitions over to internetnews.com.

If you are looking for the another show to attend for the ISP industry, stay tuned!

ESPN360 Failure

Have you tried ESPN60 lately? Go ahead. I'll wait.

At lunch today, Dylan pointed out that when you try to access the content, instead of a USER sign-up, there is a big red box that pops up and explains that you need ISP access:

How to Get Access to ESPN360.com

ESPN360.com is available at no charge to fans who receive their high-speed internet connection from an ESPN360.com affiliated internet service provider. ESPN360.com is also available to fans that access the internet from U.S. college campuses and U.S. military bases.

Your current computer network falls outside of these categories. Here’s how you can get access to ESPN360.com.

1. Switch to an ESPN360.com affiliated internet service provider or to contact your internet service provider and request ESPN360.com. Click here to enter your ZIP code and find out which providers in your area carry offer ESPN360.com
2. If you already get ESPN360.com at home and activated remote access, sign in using the myESPN link in the upper right hand corner. In order to activate remote access, you must sign in through your ESPN360.com affiliate Internet Service Provider.
3. For Verizon Customers Only: Sign-in using remote access if you already get ESPN360.com

Didn't Disney learn anything from their 2 MVNO deals that failed in short measure? To mean ESPN has come to mean SportsCenter, bowling, lumberjack, and fishing. I can't even name an anchor and maybe two analysts - former Lightning hockey coach and former Buc QB (Trent Dilfer). NHL.com, NFL.com, MLB.com - all stand to game from this stupid move.

If not ISPCON, where?

I have a list of events that I hope to attend this year. Without ISPCON, will HostingCon become the replacement event? I doubt it. New owners this year moved it to DC in August. Snooze. (Didn't ISPCON go there to die?)

FISPA should certainly take this as an opportunity to pick up the fragments, but to do that they will need to do some out-reach, advertise, and plan ahead.

Why did it fail? Content wasn't always that appealing to the masses. Key Vendors didn't support it. Most importantly, the industry is very fragmented - DSL, wireless, hosting, MSP, etc. but also there are just too many shows (WINOG, NANOG, MUMS, Animal Farm, FISPA, HostingCon, MSPCON, etc.).

Remember that many shows, including the MSP Alliance show in Vegas in the fall of 2008 also had a poor showing (less than 200 folks like ISPCON in San Jose). Even the agent show, Channel Partners, is dipping. The economy is certainly playing into that, but ten if there isn't any value to the show other than drinking and networking will people really spend the money? (In my case, it's more about the time. I want an ROI on the time.)

If you are still looking to gather, maybe it's time for the ISPCamp - the Unconference - basically ISP-CEO extended for the day with attendees sharing, teaching and learning.

ISPCON No More

Just received word that ISPCON is no more. We thought there was going to be one more in November in St. Louis but Jupiter pulled the plug on ISP-Planet.com and ISPCON. An era has ended.

Intuit is Granting Grants

From Sparkplugging blog, Intuit's announcement to help small businesses with a grant program.

Intuit recently unveiled its own version of a ’stimulus package’: one that gives America’s small businesses the chance to redeem about $1,000 in products and services from the company. In addition, Intuit is giving away more than $300,000 in small business grants, as well as $50,0000 in donations to nonprofit organizations committed to the health of small businesses including The Latino Coalition, National Black Chamber of Commerce, Small Business & Entrepreneurship Council, and Women Impacting Public Policy.

Global POP's

Remember, GlobalPOPs? They were a Dial-Up aggregation unit. Now they are VoIP Innovations, a subsidiary of ABG Capital. The company now specializes in wholesale VoIP - Origination, Termination, LNP and DID.

Another company with a name change in the space is DASH 911 is now DASH Carrier Services. DASH CS also does LNP, DID, O/T, and 911 for VoIP Providers.

Looking for a secondary SIP Origination/Termination company? PointOne.

Give me a call if you need to talk about this back office stuff - 813.496.2122.

Top MSP Making Millions

Phone+ has an article about the Top MSP's. IT folks don't want to be VAR (value added resellers) or Systems Integrators any more. They want monthly recurring income, hence, managed service provider.

The Top 100 Managed Service Providers were named this week in a report published by Nine Lives Media Inc., publisher of MSPmentor.net. This is the second annual MSPmentor 100 report, identifying the world’s 100 most progressive MSPs.... Among the report highlights, MSPmentor 100 companies generated a combined $799 million in annual managed services revenue in 2008, up 46 percent from 2007. They remotely manage 870,531 devices in 2008 ... And, they are pushing deeper into new business opportunities including managed unified communications (29.1 percent), software as a service-based CRM (18.4 percent) and managed video surveillance (17.3 percent).

As I commented on the Phone+ blog, MSP or VAR will be the replacement for Telecom Agents. It will also be the replacement for the ISP - at least, the DSL resellers. All the Layer 7 stuff, I have preached about for 3 or more years - back-up, email archiving, security, VOIP - VAR and MSP businesses are selling and making money off.

Back-up Pays

I had drinks with a few VAR's this week. Some were break-fix IT repair people only one or two years ago. Now they sell Managed Services (outsourced IT services) to stabilize their revenue (and increase margin). They charge anywhere from $50 to $100 per PC per month and $250-600 per month for a server (24/7 monitoring, repair, etc.). Well, many are starting to sell back-Up services. At least 3 companies have added over $10K per month in revenue with back-up alone!

What have I been saying for 3 years? Apparently, I was preaching to the wrong audience because these VAR's get it.

Now they are moving into VoIP and PBX sales -- even the ones who did not do telecom at all. If you aren't offering these services, someone else will. Isn't that a stream of revenue that you would like? What's preventing you from getting it?

Sprint Loses More than 1M Subs abd $1B

Phone+ reports on Sprint-Nextel's horrible 4Q09.

Sprint-Nextel "lost 1.3 million customers; 1.1 million of them were coveted post-paid users. So as subscribers defected, revenue fell – by 14 percent, in fact, to $8.43 billion." And yet they are still the third largest US cellco. "Meanwhile, Sprint reported an overall net loss of $1.62 billion, compared to net loss of $29.45 billion a year earlier." When will the bleeding stop?

Charter Makes a Deal

Charter pre-packages it bankruptcy by making a deal with a bunch (but not all) debt holders to lower the debt $8B![Yahoo]

Bells Reducing POTS

TMC reports that VZ and ATT are cutting the rate for landlines (POTS) in less than HALF! IN some cases down to $5 or $10 if you get DSL or use cellular.

I'm calling tomorrow to move my BH home line to VZ for $10.

No Time, No Money

IN training with Robin Robins today, she went over Napoleon Hill's Think and Grow Rich. (Have you read it?) A forgotten point from the book:

You need Burning Desire to achieve anything. Wishes and Wants are not burning desire. Wishes and Wants are like dreams. They are intangible and do not get acted upon.

I have worked with over 65 companies and many SAY they want to increase revenue (and who would say that they didn't, right?), but when it came right down to it, they had no burning desire to do so.

The difference between a dream and a goal is ink and a date. Once you right down your dream and put a date next to it -- it's a goal. Now your mind will work on it.

One reason many people don't complete New Year's Resolutions and Wishes is because they would have to leave their comfort zone. That's right, they would have to change something. Most people do not like Change and don't like to operate in an uncomfortable environment, like the first day at a new school or first day of a new job. But most of the personal Growth happens under the light of discomfort.

Whenever I ask if people are going to a conference, I usually hear either "No time" or "No Money". Now if you make the conscious decision to not attend because of No Time or No Money, then you have actually made a decision to stay right where you are.

Think about that.

What got you here, will not get you there. Especially in our fast paced world.

When was the last time, you took a course, a seminar, a conference, or went to a networking event? How are you learning new things?

There's never going to be "The Perfect Time". But right now could actually be the right time.

Do you know what the difference is between Wealth and Broke?

Wealthy people invest in themselves, the most valuable thing they can invest in. Broke folks invest in things that go down in value like cars, TV, etc.

I have given out hours and hours of ideas and advice. The Ideas aren't any big deal. Implementation. Execution. Of even ONE idea is the road to success.

It's also about what you don't do.

More Idiots in the VoIP Space

SunRocket didn't work. Vonage is on life support. Magic Jack is turning to targeted advertising for additional revenue. Now comes ViaTalk with $199 for 2 lines for 2 years. (Buy 1 year get 1 Free, according to dealnews.)

New customers who purchase one year of the ViaTalk VT_Unlimited Calling Plan for $199 receive two lines for the price of one, plus one year of service for free. At $8.29 per month for 24 months ($17/mo. after), that's still one of the best deals we've seen from ViaTalk. A $30 fee for activation applies, and the Linksys VoIP adapter costs $10 to ship. The plan includes e911, voicemail, caller ID, call waiting, call forwarding, free in-network calls, and more.

Tidbits of Varying News

VZ is the Top ISP for Spam Abuse

Revenue is down $25M this quarter at GX resulting in a $51M loss on $642M

AirBand raised $3M to build up, not out, its network.

Free Linux Hacks e-book

The Geek Stuff offers downloads of Ramesh Natarajan's Linux 101 Hacks E-Book for free via password "linuxrocks". The 140-page eBook includes 101 hacks to help you master Linux. [from dealnews]

L3 Profits

L3 released 4Q08 numbers last week.

Level 3 Communications has recorded its first quarterly profit in six years for the fourth quarter of 2008. The operator reported a $44M profit for the three months to 31 December; although it also reported lower revenue at $1.05 billion for the quarter than it did for the same period in 2007. Level 3 had a $290M net loss for the full year but this was considerably less than the $1.1B loss incurred in 2007. Full year 2008 revenue was $4.3B [about the same as 2007][.telegeographyg]

Even when you hit some numbers, The Street kicks your ass. But when you say, "For 2009, the company said it expects continued revenue weakness over the short term but is also working to cut costs" in Forbes, your stock is taking a hit.

Full disclosure: I rep for 20+ carriers and Level3 happens to be my biggest carrier. Pricing pressures are driving rates down on everything from Transit to Transport. Not everywhere mind you, but in the top 10 Metro areas, where L3 competes with Cogent, HE, and NTT/Verio, it is pressured to lower rates.

XO competes with it in many markets because XO has IRU's on L3's cable, so about 60% of where L3 is, there's XO. Surprisedly, pricing pressure is also coming from Qwest on longhaul routes, especially on Waves. (I rep for XO and Qwest as well, but not Cogent, HE or Verio). But the real competition comes from its own Resellers, like WBS Connect. Lately, Scott's company has gone underwater to take a deal from me, I mean, from L3 directly. I don't know where all this ends but I do expect HE, Cogent, WBS and others to start seeing more bad debt and late payments. The people who fight for price the most are also usually (not always) the ones who pay late. We'll keep watching.

New FCC Form 477 Due March 2

The FCC is not granting any extensions and this data is due on March 2nd, 2009. Below is the Public Notice, released 2/12/2009 concerning this filing.

Form 477 reporting obligations now apply to interconnected Voice over Internet Protocol (VoIP) Providers. Broadband subscribership information must now be reported by Census Tract.

http://www.fcc.gov/form477/

Released: February 12, 2009

RESOURCES AVAILABLE TO ASSIST FILERS IN CONNECTION WITH REVISED FCC FORM 477 FOR THE MARCH 2, 2009 FILING DEADLINE

On June 12, 2008, the Commission released orders adopting revisions to FCC Form 477, which required approval by the Office of Management and Budget (OMB) before becoming effective. On January 30, 2009, OMB approved the modified information collection (OMB Control Number: 3060-0816). Accordingly, the data collection revisions will be in effect for the upcoming March 2, 2009 filing deadline.

The new Web-based interface through which filers will submit their Form 477 will be available on the FCC’s Webpage as soon as possible. In the interim, information on the new filing can be accessed at www.fcc.gov/form477, including:

• Screen shots of the electronic filing interface
• Form 477 instructions
• Frequently Asked Questions

http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-09-231A1.txt

PeoplePC Helping ELN Stay Afloat

EarthLink has decided to get lean and ride the Dial-Up horse until that pony dies by the roadside. ELN wanted to buy AOL, but like Microsoft-Yahoo, no deal got done. ELN has tried many projects to move beyond the dial-up ISP business, but been met with frustration at every turn (DSLR agrees):

• on Helio as an MVNO;
• at Muni Wi-Fi;
• on BPL (broadband over powerlines);
• being squeezed by the access to sharing duopoly broadband pipes;

All of these were access plays that did not pan out. Plans to become the network operator for a nationwide network that they controlled did not come to fruition. If you are in the access game - say, reselling ILEC DSL - what is your next move?

According to its 4Q08 filing, ELN did well:

• Income from continuing operations of $27.3 million, up $5M from 2007
• Net income of $27.2 million
• Adjusted EBITDA of $72.4 million
• Free cash flow of $70.1 million
• Revenue of $216M in 4Q
• $955.6M for the full year 2008 - 21% down from 2007.

Here's where the cost savings were:

"Total sales and marketing, operations, customer support, and general and administrative expenses for the fourth quarter and full year 2008, were $71.0 million and $328.9 million, respectively. This represents a decrease of 40 percent versus the prior year quarter, and a decrease of 49 percent versus the full year 2007 comparable expenses."

ELN then went on to launch a marketing promotion under its PeoplePC brand of dial-up: " 'Connect for Less' Economy Internet Package Includes Full Customer Support for $7.95 per Month; Each 795th Sign-Up Receives The Service Free for 1 Year" or "PEOPLEPC LAUNCHES '25 CENTS A DAY' INTERNET ACCESS". What's the reason for the promo? The Economy. But ELN gives some good reasons for dial-up access, issues that Intelliwave's Director Marketing and I had discussed just last month.

"Staying connected to the Internet is very important, especially during these uncertain and challenging economic times. For a limited time, EarthLink will offer consumers a new, low-cost Internet access option," said Kevin Brand, EarthLink's senior vice president of product management. "Whether your job has been impacted and you need to search for employment or you surf the Web for bargains on household necessities, Internet dial access, with our Smart Dialer technology, continues to be an effective and inexpensive tool." [TMCnet]

PeoplePC's customers under this promo will have access to all 12,000 dial-up numbers; will have Symantec-powered email / spam for just 2 email addresses; and Free Internet Call Waiting.

I would milk Hosting, Email, Dial-Up, and DSL for as long as possible, but I would have a Plan B - funded by Plan A. First, cut costs. By that, I mean, OUT-SOURCE! You outsource your network - are those your DSLAM's or PRI's? Outsource your email and hosting. Realize that Sales & Marketing will be Vital. Hire the talent if you don't have it in-house.

Embarq Cost Cutting Nets Profit

Embarq is merging with CenturyTel this year. They just sold off their money losing Logistics business at a $40M loss, when all is said and done. Crazy, right?

But all the cost cutting that Embarq has been doing for the last 18 months, including cutting pension benefits to retirees, has resulted in $191 Million in profit in 4Q08 despite heavy line losses.

Revenue went from $1.58 billion to $1.48 billion. ... The number of lines Embarq serves dropped nearly 10 percent in 2008. In the fourth quarter alone, Embarq saw 157,000 line losses, up from 91,000 in the same period a year ago. [Kansas City Star]

Embarq blamed the line losses on the economy as people choose to go with cellular only phone plans. Here's hoping the 911 system is updated soon to take into account so many cell-only households.

Sell Wi-Fi SIP Phone with Your Wi-Fi

Garrett Smith of VoIP Supply is stating a limited edition channel program to less than 50 companies that want to see a Wi-Fi VoIP phone.

If you are selling Wi-Fi or HotZones or WLAN's, this might be an added revenue stream.

MSP Space is Moving

More mergers in the Managed Service Provider space as Florida's Spiderhost and tekGiants are merging, according to an February 13, 2009, press release.

IT firms Spiderhost Inc. and tekGiants Inc. are merging. The two companies will work in partnership from Spiderhost offices. Spiderhost says it plans to acquire TekGiants by year's end. The combined company will have 11 employees. Spiderhost specializes in high-speed Ethernet and custom Web site services. (Spiderhost is one of my clients)

Wow just heard that 'VARBusiness' to close, content to appear in 'CRN'

"The MSPAlliance Tuesday introduced the Accredited Master MSP designation for MSPs that provides reseller opportunities to other MSPs, VARs and IT solution providers, including the potential use of network operation centers." [Phone+]

Ikano Google Apps Partner Edition

Here are the details about the Google Apps for ISP's through Ikano. If you have 5,000 or more email accounts, this makes sense. If you have more than 250,000 email accounts, you can go direct to Google. If you contact Ikano please tell them you saw it on RAD-INFO.net (or contact our office at 813-963-5884 and we can help you with this).

Ikano Google Apps Partner Edition.Ppt

View more presentations from googleapps. (tags: google apps)

Outsourcing and Leverage

The ROI: you no longer have the power consumption of the mail server and the anti-spam gear; double that because you don't have to cool it either). No gear to maintain. No tech to massage the email server or the anti-spam boxes. No more cost in anti-spam filtering. All that goes away when you outsource it. You time and money and a tech back to work on other projects.

While I am a referral agent for IKANO's program, you should outsource your email regardless to someone: Intermedia.Net, Everyone.net, or GroupSpark. Hosted Microsoft Exchange is a pain to run and most folks want support for our mobile gear (smartphone and laptop), which is nothing more than a pain and expense for you.

Leverage is a smart business move. It means that you leverage the skills, staff, and services of a strategic partner. I know there will be separation anxiety, but you'll get over it... eventually.

One last point:

Email Archiving

"Regulations and guidelines like the Federal Rules of Civil Procedure put pressure on IT organizations to ensure that email is properly retained and can be reliably located and preserved in the event of legal discovery. Coupled with the growing importance of email as a store of intellectual property, email archiving has become both legally necessary and critical to the operation of your business." [Ikano] Google does email archiving? Do you? Make sure that your partner does.

Charter is Filing BK

Alex tweeted the story on Twitter: Charter to file for bankruptcy by April 1

Charter has bad service. $20B in debt. No cash. $14B in assets in need of a DOCSIS 3.0 upgrade. Missed a debt payment, so its off to court to seek bankruptcy protection. With about $6B in revenue, it still posted about $1.6B in debt in 2007. Not good.

Employment Law Pitfalls

One more article about Employment Law. NFIB's MyBusiness magazine this month has an article about the legal pitfalls of laying people off; as documentation requirements; and overtime on remaining employees.

"With the economy in crisis, many small business owners are looking for ways to cut costs, which often leads to layoffs. But employers should be careful when laying off employees if they want to avoid costly lawsuits."

Can employers terminate anyone they want? Can I ask workers to do more? Read the article for the answers.

If you are considering a layoff or reduction, please consult an Employment Law Attorney who will understand both federal and state laws pertaining to layoffs and employee separation laws - and there are many including WARN and OWBPA.

BTW, for those of you looking for ways to trim payroll, in this Wall Street Journal article, there are about 5 suggestions.

Key Point

Make sure you are properly classifying employees as exempt or nonexempt under the Fair Labor Standards Act. Nonexempt employees who work a 40-hour week must earn a minimum wage and must be paid overtime (one-and-a-half times the rate of regular pay) if they work more than 40 hours in a week. You cannot give nonexempt employees time off in lieu of overtime. More information is available at www.dol.gov/esa/whd/flsa/index.htm.

Taxes and Retirement Plans

It's tax time.

What’s New for 2008 Taxes? According to the NFIB, "Last year’s economic fallout also brought some business tax changes."

• Section 179 expensing,
• Higher gas, larger mileage deduction,
• high-deductible health plans and health savings accounts ,
• details and more tax tips

Avoid the common errors when preparing your tax return: Topic 303 at the IRS site.

Retirement Plans

"If you're thinking about setting up a retirement plan for employees, the clock is ticking: Oct. 1 is the IRS deadline for when employers must set up a SIMPLE (Savings Incentive Match Plan for Employees). If you received a filing deadline extension for your 2007 returns then you have until Oct. 15 to set up a SEP (Simplified Employee Pension) in order to take a deduction for the 2007 tax year. Oct. 15 is also the date that 2007 contributions must be made to both plans for anyone who received a 2007 extension." [from NFIB's MyBusiness mag] The Chicago Tribune explains all this stuff here.

BTW, for those of you looking for ways to trim payroll, in this Wall Street Journal article, there are about 5 suggestions.

One final NFIB benefit (besides the Lobbying effort and the information): Healthcare Insurance.

Nuvox Update

I spoke with Nuvox yesterday. It looks like they have $30M in the bank, re-financed their debt, and are looking for a possible acquisition. One Communications comes to mind.

The other thing he mentioned was that Nuvox migrated to Google Apps.

NuVox business customers can now access Google's popular Web applications on their own domain such as Google Docs to create, share, and collaborate on documents, presentations, and spreadsheets in real-time and can even gather a variety of business information in one place from Google Sites which brings forth videos, calendars, presentations, attachments, and text -- and easily share it for viewing or editing with teams or as a company intranet. NuVox's customers can also get access to Gmail with up to 25GB of storage per user, mail search tools, and integrated chat. Gmail also interfaces seamlessly with popular email clients. And also Google Calendar, which helps to coordinate meetings and company events with sharable calendars that work with your company's directory. Schedule meetings, manage conference rooms, and receive "large company" services for small to medium enterprises. Google videos for business and Google Message Filtering are also part of the deal which NuVox’s customers can take advantage of.

It seems that when they mention Google Apps comes with the T1 service, Nuvox gets more appointments.

"The power of Google standing behind email and other essential applications gives our customers a bold edge in the marketplace. Additionally, this is a major advance in NuVox's strategy of offering innovative managed services that are not currently available through other providers." [TMCnet]

Nuvox is a Sylantro shop that is now making a push into SIP trunking, but I just don't see why. Nuvox is one of the most inexpensive CLEC's, selling T1's in many markets for sub-$400. I don't see where its customers would migrate to SIP trunking as a cost savings. As with any SIP trunk, interoperability with the PBX is essential.

"NuVox SIP Trunking is compatible with a variety of premise-based IP-PBX systems including Cisco, Avaya, Ingate, and Digium to date." [TMCnet]

Wireless Internet Providers Urge Congress to Help Small Businesses

FOR IMMEDIATE RELEASE

Washington, D.C.—February 4, 2009

As Congress crafts the new American Recovery and Reinvestment Act, WISPA, the Wireless Internet Service Providers Association, is urging Congress to help ensure that the new bill expands broadband Internet access to Americans in rural areas and to consumers with limited or no access to affordable broadband services.

In many communities, located in rural, suburban, and urban areas, consumers cannot access traditional wired broadband services. They live in areas too far from DSL and cable networks, with lower population densities, or encumbered by geographical barriers, that make the cost to wire these communities prohibitive. Using wireless technology, Wireless Internet Service Providers (WISPs) provide Internet access service to approximately 2,000,000 consumers across the nation. Most WISPs are small companies based in the local communities they serve. Wireless technologies can offer "next generation" fiber-like speeds to maximize economic development and to meet the needs of underserved businesses and public venues.

In letters to key Congressional decision makers, WISPA asked Congress to target federal funds to rural, unserved and underserved areas. WISPA proposed that small Internet service providers – those with a track record of providing Internet access services to small and rural communities – be given priority for a meaningful portion of federal grant funds. WISPA recommended designating more areas as "rural" and "underserved" so that grant funds could better be dispensed to areas with the greatest need. WISPA also supported extension of 20-percent tax credits to entities pledging to offer higher data rates in rural, unserved, underserved and residential areas.

WISPA President Richard D. Harnish said "WISPs across the country are working to make their representatives in Washington aware that to truly revitalize the American economy, it's essential to provide assistance that really reaches consumers in rural America and those who have few, if any, choice in where they receive broadband services. Small, local wireless broadband providers already have the expertise and the experience to provide broadband Internet access to rural and hard-to-reach areas. The American Recovery and Reinvestment Act must dedicate a meaningful portion of these new funds to better meeting the needs of consumers in rural, unserved and underserved areas."

Contact Info:

WISPA * 866-317-2851 * www.wispa.org

MagicJack Exposed

It seems like there is a lot of info coming out about MagicJack. One of their head honchos was at IT Expo East on a panel. He does not give off a warm and fuzzy feeling. I expected him to break out laughing at any minute for the number of people he has duped. It is reported that MJ infomercials pull in 7000 sales per day. Unfortunately, consumers forget that you get what you pay for.

The Magic Jack TOS (Terms of Service) can be found online. So can the MJ Privacy Policy . (It's a must read.)

MJ offers a limited 911 service, according to the TOS, which is funny since the parent company, YMAX, is a CLEC. And the honcho was talking about the GSM chip in the device that allows for triangulation of location.

The other issue is tech support. The honcho wouldn't tell Thomas Howe the customer support number when asked. He said it was on the credit card statement. They want all support to be chat -- but what if your PC is messed up due to a USB device installation??

Targeted ads, too much access to my PC, low call quality, and just too much cheesiness.

If you want to read the highlights of what people are saying about MagicJack, go here and there and specifically here.

And if you need help with Uninstall, try here.

Nothing in life is free. It is this very mentality that has led to the economic collapse.

DSL Prime Numbers

The latest issue of DSL Prime had a great story:

U.S. DOCSIS 3.0: 10% Today, 50+% 2010, 80% Soon After

"65 million U.S homes will be able to get 50MB service DOCSIS 3.0 by 2010-2011, more than half the country. At least half of the remainder be covered in 2012-2013. 15 million are ready today: 10M at Comcast, and Cablevision is ready to turn on DOCSIS in a few months. The numbers and more at Fastnews.

That's without stimulus money or policy direction.

Telcos must respond and have the tools to do so. In Q3 10M homes added DSL. 250 million homes have DSL, paying the carriers $50B per year for the service. Growth will be slower for a great reason: 55-80% of families are already connected across the developed world. AT&T, Softbank and soon others will be adding tens of millions of femtocells for a very attractive combination of DSL + wireless. Despite all the issues, DSL will be the leading Internet connection for the next decade.

Outside of U-Verse territory, AT&T lost at least 27,000 DSL customers... Cable is continuing to pull ahead, although DOCSIS 3.0 is just starting to appear....U-Verse added 264K customers Q4 to pass 1 million. Ma Bell now includes 121K 3G LaptopConnect wireless cards.

AT&T is losing 10% of landlines each year, and is already down something like 30%. Over 5-15 years that will turn the wireline network into a shell. ... they are moving to become the all wireless company... now ordering Femtocells.

Asterisk book

Legally download O'Reilly's book on Asterisk for free, here is the link.

Personal Touch

From Michele Miller's blog, a personal note from J Crew. It came with an order. Do you send out hand-written notes after a sale? Why not? 90% of my new customers did. (Then I got lazy/busy/lazy).

Qwest Personal Digital Vault

According to Telephony mag, Qwest has starting offering online backup storage.

the Digital Vault service is free to Qwest’s high-speed Internet subscribers storing up to 2 gigabytes’ worth of encrypted files, including photos and video, which users can access from anywhere via broadband by entering a user name and password (Mobile access is currently not an option, however.).

Online storage, managed router/firewall/device, email archiving, technical support, document management -- these are all things that the Independent ISP should have been at the forefront of providing. Instead, the Industry (for the most part) has paddled along in the access only market until now the RBOC's - VZ, ATT, Qwest and even Embarq - are looking like Internet Innovators. Worse, they are becoming the go-to company for anything Internet/Web connected. 2009 is the year you need to get ahead of the wave folks. Partners will help you add revenue streams as well as stickiness and get you the reputation for being the "Expert" (but you will have to relinquish your control issues).

5 Must Haves to be Best

According to Dan Caruso, these are the 5 must have focal points of your business to be a Best Place to Work in telecom. Does it fit your business?

1. Great service for our customers
2. Less hectic work environment for our employees
3. Getting work done through efficient processes, underpinned by reliable data
4. Remaining focused, by de-prioritizing less essential initiatives and projects
5. Continue to tighten our operational finance process, as this is what ensures we have the financial capability to take care of our customers and our employees

I know I have been writing a lot about strategy and management and sales lately - and for those of you looking for more technical stuff, I apologize. Right now, I think the most important thing I can tell you to help you manage your business through this current economic turmoil is in strategy, talent, management, sales and marketing.

Let's face it: you have the technical piece down for the most part -- but as Gitomer says, "Nothing happens until a sale is made."

Startonomics

Startonomics 2009 Conference Presentations are available on DocStoc. There's even a Beginner's Guide to SEO for those that want a primer. Another one is 5 Q's You Must Answer:

1. Why are you doing this? (Answer: Passion)
2. Do you have the best crew?
3. Who will you take money from?
4. What's Plan B?
5. What outcome do you want?

BootStrapping 101 - I don't know how it will compare to Seth Godin's BootStrapping e-book.

SIP Trunking Trends Up

I just got back from Internet Telephony Expo East in Miami Beach. It was co-hosted with Digium Asterisk World and the 4G Wireless Evolution. Main themes were UC (Unified Communications) and SIP trunking.

Garrett Smith from VoIP Supply has a blog post about SIP Trunking and the ISP which I agree with.

In talking with a number of regional ISP’s, the reason for their hesitation is actually quite simple - the access business is much different then the voice service business. In other words, selling and supporting access is a different business then selling and supporting voice service. ... Most regional ISP’s are small, meaning they have limited resources. From what they tell me, even at it’s cheapest, offering SIP trunking services would in many cases do more then good for their business.

The reverse of that is if you are a VoIP Wholesaler, unless the ISP has a sales force, they will not be a good partner for you. Uptake of a new service is roughly 10-15%. Most independent ISP's have less than 1000 subscribers, so that means, maybe 150 people would take VoIP via email and direct marketing. Is that enough? Is that enough business for you to go through the expense and effort of white labeling a service and supporting them?

The push in 2009 that I am seeing is for wholesalers to assist their partners in selling more lines any way that they can.

There are corollaries to that: if the telecom agent is a small shop without technical expertise: they probably won't be able to sell Hosted PBX. Another is that if you sell on price, Hosted PBX won't be a good fit either.

here's one issue: SIP trunking is being sold as a PRI replacement. That works except for 2 things: reality and revenue.

The reality part is that PRI is a time tested standard and SIPconnect (the SIP trunking spec) is just a specification containing numerous RFC's, which allows for many interpretations of configuration. In the case of SIP Trunking, the client must have a network assessment for deployment planning and the Internet bandwidth must be examined for metrics and capacity. Also, the IP-PBX interface must be checked for interoperability with the carrier. There is a gap in the sales process whereby normally these steps are ignored. (The fix here is to get an IAD that does PRI Emulation like the Adtran Atlas 550 and convert the SIP trunk back to PRI).

The revenue side is mentioned because PRI is TDM and can fetch higher revenue than anything with IP in its name. IP means cheap, which means less revenue. Less top revenue for the service providers books, less ARPU, and less commissions for agent or sales guy selling SIP Trunking. All with the extra headaches of inter-op.

Despite all this, SIP Trunking is all anyone talks about these days. "Save them money!" What about the added benefit of an IP Communications trunk? Oh, well, that's not important.

Google's ISP Plans

Google laid dark fiber and transpacific fiber to cut down on telecom expenses. It then peered with (or directly connected) or used a CDN (content delivery network) to further cut its transit costs.

Google was in on the 700 MHz spectrum auction but only as aploy to get the spectrum open access rules for when VZW bought it. Rumors often swirl around GOOG entering the access game (like buying Sprint), but it sticks to its knitting - search and SAAS (Layer 7).

Apps (and hosted email) wise, Google wants ISP's to re-sell its services. Too many are scared by the size of Google and their history with the RBOCs. And maybe rightly so as Google unveils TISP, the in-home wireless broadband service via your sewer. (It's a joke).

The other tool Google launched is "Measurement Labs, a server platform and a series of software tools to measure broadband speeds, whether or not your ISP is filtering BitTorrent traffic and a diagnostic tool for last-mile problems", according to GigaOm.

Google is working on the GDrive for online data storage. (See GigaOm's analysis here). Google's various tools already store pictures (Picasa), email (Gmail), documents (Apps), allows for sharing (though not easily) - like Microsoft products. Google and Cisco are playing catch up. One ominous thought:

“Before you know it, Google has become a daily and integral part of your digital portfolio. Not that this a bad thing given Google’s products are really good but it should make you think about how dependent you can become on Google for pretty much everything. The downside is you can lose access to a lot of essential information if Google, for whatever reason, locks you out.” - Mark Evans

I'd like GrandCentral, Google Talk, and Twitter to be integrated with OpenSocial and Google Apps.

Full Disclosure:

IKANO has just signed me up as a Referral Agent. I will get paid to send IKANO ISP's with at least 5000 users who migrate to the Gmail and Google Apps for Partners platform. Call me for details at 813-963-5884. It will save you time and money (both power and spam filtering).

8x8 3Q Numbers

Paclt 8 had a big presence at the IT Expo in Miami. 8x8 had just announced its favorable quarterly earnings report. B2B is now 66% of revenue, even though they bought quite a few B2C customers from SunRocket and other demised ITSP's since July of 2007.

Revenues for Q3 FY 2009 were $16.2 million, compared to $15.8 million for the same period last year and $16.4 million for the previous quarter.

Here are some of the highlights:

• GAAP income for the quarter was $180,000 [on $16M in revenue!?]
• 8x8's customer base up by net 962 new customers
• the company now provides service to 14,706 business customers.
• business churn is down to 2.9%
• direct sales accounted for 84% of new business sales during the quarter
• quota-carrying direct sales force grew from 43 to 56 agents;
• Expanded indirect channel network to include more than 30 resellers and VARs

Besides the $100k net from $16.2M, here's another oxymoron:

"Successfully transitioned approximately 1,000 former business customers and a unified communications technology platform from Avtex, LLC to the 8x8 Virtual Office network."

Yet only netted 962 customers and 84% new came in from direct sales? It doesn't pass the sniff test.

Huw Rees, the VP of Sales & Marketing, was on a panel with a guy from Magic Jack (along with Broadvox, TW Telecom, Telefonica, Iphonex). Mainly it was whining about the ILEC's charge too much for stuff and the ILECs are inefficient. Someone did finally note that if the ILEC's were efficient, everyone on that panel except for the fiber T companies (TWT and Telefonica) would be out of business. Rees also noted that he didn't want to collect / pay taxes. "It's over the Internet. It should be free of taxes," was his reply to my question. There's never been a long standing model of "We will provide it cheaper to you." It only lasts for a finite time, before the model blows up.

BTW, Magic Jack was talking about costs especially of customer support when he was questioned by Thomas Howe, who asked him for the tech support number. The MJ guy said that it was on the customer credit card statement. Nice. 23 days after you buy it, you get some useful info in a place you wouldn't think to look. He hinted that the new GSM chip in these devices (that supposedly i2 telecom owns the patent on) would geo-locate the user for 911 purposes via tower triangulation. I'm wondering how much info and tracking that MJ device is doing. Anyway... see ya soon.

Info from various sources including VoIP-News and SEC filings.