Transcript Recognizing the Opportunities in the SMB Market

Recognizing the
Opportunities in the
SMB Market
Bill Miller
VP Product Management
Digium, The Asterisk Company
Recognizing the Opportunities in the
SMB Market
• Recognizing the Opportunities in the SMB Market
(TMCU3-05)
•
Tuesday - 09/16/08, 1:45-2:30pm
Many SMBs find the idea of cutting their phone bill and, perhaps more important, being
able to take advantage of applications that unify voice and data, very appealing. However,
research also shows that SMBs are confused about the products on the market and often
lack the in-house technical expertise to comfortably sort through the options. Vendors of
all sizes are coming out with products that are designed to be easier to use and many big
telecom equipment vendors are moving downstream from the enterprise market to SMB
with tailored offerings, which only serves to add to the SMBs’ confusion. In this session,
the presenter will help attendees better understand the factors affecting their opportunities
in the SMB market and determine how they can make the most of its opportunities.
Presented by:
Bill Miller
Vice President of Product Management
Digium Inc.
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Why are you Here?
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Are you an end user?
Are you a reseller?
Are you an open source developer?
Are you a service provider? Hosted?
Are you a student?
Will you use twitter during the presentation?
Will you just plain text during the presentation?
……….one more question……
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Are you confused?
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SMB’s…..S…..M…..B…..!!!!!
So let’s look at the definition of an SMB in Wikipedia:
• Super Mario Bros., a video game made by Nintendo
• San Miguel Beer, a local beer in the Philippines.
• San Miguel Beermen, a professional basketball team in the Philippines now called Magnolia Beverage
Masters
• Server Message Block (alternatively, SMB/CIFS), an application-level network protocol mainly applied to
shared access to files, printers, serial ports, and miscellaneous communications between nodes on a
network, used in particular by Microsoft
• Seven Mile Beach, a name of several beaches
• Simulated moving bed, a method for countercurrent chromatography
• Small and Medium Business, a synonym of Small and Medium Enterprise which is a perceived
commercial sector
• Small Mouth Bass, a fish
• Spartan Marching Band, the marching band for Michigan State University
• Steve Miller Band, a 1970s rock band.
• SMB connector, SubMiniature version B connectors for radio-frequency circuits
• Super Monkey Ball, a video game made by Sega
• Surface Marker Buoy, a surface detection aid used by divers
• Sveriges Medeltida Ballader, the 'official' collection of old Swedish ballads
• System Management Bus, a PC communication bus
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SMB’s…..S…..M…..B…..!!!!!
• Ok, just having some fun with you….
….seriously, when you talk to “our SMBs”,
if they are confused
YOU can help them!
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What is an SMB?
• Small Business & Medium Business
• An SMB is classified as a business with 2-1000
employees
• The divides vary by supplier, but typical number of
users/seats/phones:
– <100
– <500
– <1000
Classifications for SMB Today
• Lets have some fun here as well…
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Some companies call SMB 5 users
Some companies call SMB 50 users
IBM and others calls SMB under 1000 users
Some companies refer to as SME, Small Medium Enterprises as multi-site
businesses with up to 5,000 users
• For this session, let’s call all the following sizes SMB
• Each group has both common and specific requirements which we’ll address
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1 to 10 Seats/Phones = SOHO, or Small Office - Home Office
<50 Seats/Phones = Small business class
<100 Seats/Phones = Small to medium business class
<250-500 Seats/Phones = medium mostly multisite business class
<1000 Seats/Phones = medium enterprise class
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Market Dynamics and Data
• Infotech: 70% of US SMBs are
implementing, trialing, or planning a
deployment with VoIP & Unified
Communications
• A Savatar-Digium survey: over 90% of all
enterprises, including SMB, would consider
open source for their corporate telephony
system
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SMB Explosive Market Potential
Source: AMI (2008)
6.3M SMBs have <99 users in the US
• Less than 20% of the SMBs have purchased VoIP Systems
• 1/3 of SMBs are planning to purchase a new phone system in the next 12
months
• 2/3 SMBs are selecting premise based IP PBX solutions rather than
hosted but there is growth in both
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SMBs, VARs and Open Source
• Whom do SMBs buy their business phone systems from?
• Over 65% purchased it from a VAR
• VARs should sell a *total* solution, taking the worry out of the
SMB’s objection category:
• Phones, PBX, VoIP/T1 service, networking, network services, etc
• Blur the line between sales & consulting (be consultative)
• You’ll close more sales
• Your customers will be happier
• Gartner Group says:
– 90% of new businesses in US are SMBs
– These SMBs will accelerate adoption of open source
– Up to 15% of spending will cannibalize proprietary software market
but it is incremental spending (over next 5 years)
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SMB Telecom Phone Costs
• Sweet spot of phone systems for SMB:
– 97.6 percent is <100 users.
• Top 10 Vertical Markets for sub 100 users:
– Finance, Insurance, Wholesale, RE, Mfg, Admin, Health
Care, Trans, Educ, Const, IT, Prof, Sci, Repair, Retail,
Hospit, Farming
• Size/Ranges of these SMB Phone Systems:
• 3-7 phone lines;
• $250-$1250 per month
• $3000-$15,000 annually
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SMB factors…..
• SMBs will consider changing to a VoIP system if:
– Economics: Maintenance is more expensive than a new
system
– Support: Old System needs replacing or “End of Life”
and no longer supported
– Management: new systems have easier to use tools and
better visibility to the owner
– “Change” event: Office Move
– Company growth
– Features: Owner wants new applications and flexibility
How do SMBs buy their VoIP?
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Most are unsure where to turn
Need “Trusted Advisor”
Today, there is NO #1 brand, it’s splintered
SMBs buy differently than Enterprises; no RFP
Its about SMB owner trust of supplier & implementer
Many SMB owners are hobbyists and/or gadget folks
Decision maker is typically the business owner
Most are not savvy enough to know questions to ask!
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Selling to SMB VoIP customers?
• AMI says 80% of SMBs try to understand
the TCO for their potential purchase
• Explain to the SMB owner how the new
VoIP system will make life easier
• Explain a few of the many VoIP features
that have relevance to their business
SMB VoIP Choices
• There are two basic choices:
– Premise based IP PBX: traditional
– Hosted PBX: Centrex-style
• There are combinations of above from various
channels and suppliers, and some offer both
• Resellers who build and integrate turnkey offers,
including services, SIP Trunks or phone trunks
(FX0, T1/E1), integrate converged solutions have
the advantage since it’s “One throat to choke” and
make it easy for the customer.
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Buyer Selection Drivers
• When does premise-based make sense?
– Buyer wants ownership and control
– Buyer does not trust any phone company/service
provider
– Buyer is uncertain of quality of service
• When does hosted make sense?
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Buyer does not want to manage the system
Buyer wants ability to modify service with a phone call
Buyer wants to minimize up-front costs
Buyer does not want to pay perpetually
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Basic Feature Sets for SMBs
• The MOST basic features for SMB (from recent
interviews with a group of SMB resellers):
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Voice mail
Call Control: Call hold, call transfer, etc
Caller-ID
Conferencing (Audio)
Auto-attendant/IVR
Find me/Follow me
Simultaneous Ring
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Advanced SMB Features
• Performance Monitoring
– Call management including concurrent calls, max
number of calls, call flow patterns, bandwidth used
• Cost Control
– Call Detail Records (CDR) to analyze costs
– Comprehensive Historical reporting and trends
– Expense management
• Call Center
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Queue management
Call Recording
Supervisor barge-in for monitoring and assistance
Customizable Reporting
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Advanced SMB Features
• Unified Communications
– Web 2.0, web-based tools
– Presence
– Presence across multiple networks (SMBs use own
network, Skype, Internet, open source Asterisk, soft
clients, social networks, Google, etc)
– IM/Chat/Text/Emerging Social Network tools
– Integration with CRM
– Outlook/Office/Google Integration
• Security
– Voice encryption
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Most popular SMB VoIP Capabilities
SMB <100 Employees SMB/SME >100
Employees
Auto Attendant/IVR
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Simultaneous Ring (1)
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Call Center Features
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Find me/follow me
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Unified Communications (2)
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Soft Phone
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Click to Dial
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Office Integration
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Music on Hold
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1. Office Phone & Mobile Phone, most common
2. Voice Mail to Email, most common
Source: Savatar
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Unified Communications for SMB
SMB/SME Challenges
SMB <100 Employees
SMB/SME >100
Employees
Phone System Costs
12 %
7 %
Features Missing
10 %
7%
Features Costly
10 %
9%
Moves/Adds/Changes
9%
10 %
Billing Accuracy
7%
10 %
Routing
6%
6%
Capacity
5%
11 %
Multi-site
4%
9%
Source: Savatar
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What End Users Ask For
• The solution has to be easy to install, buy and use
(No IT Department)
• Complete Solution with Feature Rich Services
• Quick Provisioning Time
• Fully supported if mission critical
SMB Gains Productivity
• Adding more information to your call
enriches your productivity
• Customer calls present information to
enhance customer service and
satisfaction
• Internal calls can do wiki lookup and
background of person and display them
for immediate access
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SMB Benefits: Gain Productivity
• Recording calls on the fly protects an
owners business while ensuring new
employees can be trained properly and
legal issues can be tracked
• Presence enables more efficient
communications
• Simplicity enables the SMB to focus on
the business, customer service, and
flexibility
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Connecting: Trunking Choices
(Trunk=Phone Line=channel)
• What is trunking? It’s the Connection to phone
service and phone company.
– Traditional analog (FX0) trunks
• SMBs typically buy one phone line for each 5 people, but
minimum of 3: main line, backup line, and fax
– Traditional digital (T1/E1)
• 24/30 trunks respectively
• Using 5-1 ratio (employees-phone lines), can support
companies over 100-150 people
– IAX (Asterisk)
• These are VoIP lines that connect Asterisk Servers
– SIP (Emerging)
• Newest Popular VoIP Service
• Attend SIP Trunking Seminar here at ITEXPO
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Resellers Pitfalls
• Our experiences have shown:
– Some data VARs over-engineer the solution
– This places their quotes higher than the winning VAR
– Some Voice VARs understand features, but lack in
depth knowledge of VoIP and data infrastructure
– Key system replacement with VoIP tricky
• IP Phones more expensive
• IP Applications far exceed KS capabilities
• Why these observations and experiences?
– Data engineers want redundancy; fault tolerant
– Ideally match the user requirements with the solution
– And the budget…..
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End User Pitfalls
• Know your pain points and toleration for key criteria
– Features (VoIP SMB Systems near parity with legacy
solutions)
– Price (legacy systems cheaper, less flexible)
– Technology (Do you care?)
– Ownership – hosted or premise based (i.e. want
complete control to add/modify users?);
• Be clear about requirements
– Complete Clarity
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In Summary
• VoIP is mainstream today
• Price/performance is unparalleled
• Resellers are looking for a new offering to address
today’s SMB/SME
• If you answer a few simple questions, you should
be able to focus on the right solution – both price
points and capabilities.
• Digium is in the Open Source pavilion, stop by and
see UC for SMB and why today’s choices are more
cost effective than ever before!
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Thank you!
Bill Miller
[email protected]
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