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As Leslie has discussed, the results from hosted service providers have been very good in an economy where so many businesses are in decline. In contrast, one declining category includes PBX vendors, many who have reported a 20% loss in line shipments during the first half of this year. We just finalized our 2nd quarter reporting and our performance results are very positive. We have always maintained the business philosophy that we make money when our customers make money. Many of our customers saw their sales grow 20% in Q2 over Q1 of this year, so clearly, the success of our customers is helping to grow our business quarter over quarter, year over year.
What is exciting is the fact that hosted telephony growth is a global trend. During the second quarter I visited with customers from the Americas, across Europe and Asia Pacific and all told me that their networks have been growing. Our service provider customers are serving larger and more demanding enterprises with hosted PBX, Unified Messaging, Collaboration and Call Center services. The expansion of hosted communication features in their services portfolio has also helped them to increase their monthly recurring revenue.
My prediction is that this is the start of a favorable trend for hosted service providers. The benefits of a hosted solution are becoming clearer in the minds of business owners and executives. And our industry has a renewed focus on innovation. Employees face unique communication challenges within their specific industry or vertical market. Innovative service providers and third party developers are building new, integrated applications that help employees more effectively communicate in their specific vertical industry. By continuing to add value to our networks that address expanding customer requirements we grow our collective businesses.
I’m looking forward to seeing what hosted service providers are selling in Q3.
Many of us have heard of the promise of video communications for years, but have been disappointed with the overall experience. I believe that has changed. I recently started using a VVX personal video phone from Polycom, and think the time for video has arrived. Why? Here are my reasons:
- High-quality experience: you can actually see and hear the person. In fact, these phones use high definition codecs for audio and video, making the voice better than toll quality.
- The terminals themselves are cost effective and easy to use. Calling someone is as simple as picking up the phone and dialing, a standard phone number. It couldn’t be any easier.
- Bandwidth is cost effective and ubiquitous. This extends to people who are working at home using high-bandwidth services with great quality and speed.
But the most important reason is that these personal video phones change the way we communicate with the other party. In this era of email, instant messaging, text messaging and tweets, we all miss the basic personal-to-personal communications that can be created with a video phone.
It is amazing how often we struggle to focus when talking to someone on the phone. We read emails, check websites, and some of us even play games on our computers. Last year, when I started using high-definition codec for audio, I realized that my conversations improved and became even more effective. After a few weeks, I became hooked on high-definition audio and really had a hard time spending time on calls with the poor quality that are indicative of so many cell calls today.
When we started rolling out video phones within BroadSoft, I wondered if we would really use them for internal calls. Many of us have worked together for 10 years, so I wasn’t sure if they could add much value. I was pleasantly surprised. The most obvious and important change with a video phone is that you have to look at the person you are talking to, creating that personal connection that we often lack with audio-only calls. I am amazed at the quality difference in a call when both parties are focused and can see the expressions of the other person. Both parties become 100% focused on the conversation, with no distractions. We often look for business tools to improve how we work together, and I could not be more convinced that personal video will be just that. My ability to see and talk to a team member really flattens the world.
The industry challenge now is to create larger network effect; that is, making it easy for all us to use this amazing technology to speak to each other. Once we solve this, we will not only gain the benefits within our companies, but also between our companies. I would love to be able to talk to all of our customers over video. This should be the challenge for our family of great service providers.
See you on video!!
Mike
Michael Tessler
Scott Hoffpauir
Leslie Ferry
Alex Doyle
Curtis Hartmann
Shirish Andhare
Paul Adams
