Telarus Discusses Implications of GeoQuote Patent

August 27, 2009

12 Min Read
Telarus Discusses Implications of GeoQuote Patent

By Cara Sievers

Master agent Telarus announced on Feb. 24 that it had been granted a patent for GeoQuote, its real-time multicarrier quoting system. The patent, which came nearly six years after the original GeoQuote patent application was submitted in 2003, covers the technology that powers Telarus’ public-facing lead-generation sites as well as its password-protected agent back-office sites.

GeoQuote technology enables the general public to dynamically view carrier service pricing and availability for their exact locations in real time. To determine exact price points, GeoQuote utilizes a combination of carrier XML API connections, geomapping and database standardization techniques to calculate the exact distance from a user’s location to the location of the nearest vendor’s point of presence.

Since the only way to get access to Telarus’ patented real-time carrier service quotes is to sign up as a Telarus agent, it seems the protocols non-Telarus agents use to obtain quotes might be affected by the patent. However, at this point, there isn’t any worry to be found.

“As long as it can’t change the vendor tools we use with the carriers, I can’t see how it will affect us,” said Ken Mercer, senior vice president at fellow master agent Telecom Brokerage Inc.

Steve Roberts, president of Salestream Software, maker of MasterStream, which corners a large part of the carrier quoting market, shares a similar ambivalence about any “threat” the patent might imply. “Obviously, we’re a little overlapping in terms of what we provide; but I think that most people that need software, need software, and the people who need a master agent, need a master agent. I don’t think, in my mind, that we are direct competitors,” said Roberts. “But even so, I don’t think the technology that they’re trying to claim can be claimed relative to the way the industry is now quoting. We are conforming to the publicly available API (application programming interface) specifications that have been provided to us by the carriers; so our industry, like all industries, has implemented a set of standards by which to achieve instant quotes. Therefore, enforcing a patent on real-time quotes defies logic.”

Dana Dwyer, president of RPM Software, feels Telarus’ patent on real-time quoting will in no way impact RPM Software’s application development or business operations.

“In regards to patent law, there are two key things to be aware of: 1. patent infringement, and 2. patent validity. With respect to the first point, in application development, there are many ways to go about solving business problems. If you achieve the same result using a different method, there is no infringement. Period. Secondly, in terms of validity, there is a question of, ‘Is the invention truly novel?’ That is, are there any examples of prior work (whether they have been patented or not). It’s impossible for the U.S. Patent Office to perform an exhaustive search on every patent application to determine the uniqueness of an invention. It’s quite common for patents to be issued where prior work does exist. And in fact, in this case, there is a company called that has been offering real-time quotes for telecom services for homes and small businesses since at least 2000, three years prior to the Telarus patent application,” explained Dwyer. “But whether or not the Telarus patent is valid is not an issue for RPM Software. Our approach to solving the problem of real-time quoting is sufficiently different so that there is no issue of patent infringement.”

With the significance of the patent in question, and to get some insight on Telarus’ plans for enforcing it, PHONE+ recently had a chat with Lance Akins, vice president of sales at Telarus, about the feedback the company is getting about its GeoQuote patent and what it means for the industry. What follows is a transcript of that discussion.

Cara Sievers: What kind of feedback are you getting from your own agents and others in the industry since you patented real-time quoting?

Lance Akins: The feedback has been very mixed, depending on what kind of relationship the individual or organization has with Telarus. For our agent partners, we’ve seen nothing but enthusiasm from them. GeoQuote has been, and continues to be, a real secret weapon for them in sales, and knowing that we’ve taken the appropriate steps to protect their strategic advantage has reinforced their decision to work with us. The patent also has attracted new agents who never knew GeoQuote existed before the patent issued and the ensuing press followed. So, you could say, just by virtue of receiving the patent has a big marketing and recruiting win for Telarus.

On the flip side, we have received negative feedback and even been confronted by another master agent (who primarily uses MasterStream). I believe the exact line was, “you just can’t patent real-time telecom quotes. That’s like patenting air.” Well, to the contrary, the system to calculate this very industry-specific information is very patentable, as it turns out. I know if the shoe were on the other foot, and we relied on a third-party software vendor for our most valuable information – carrier quotes – and a competitor of ours not only developed their own software, but patented it, I’d feel very uncomfortable too.

CS: What does your patent mean for MasterStream and RPM?

LA: Both MasterStream and RPM have an excellent and diverse set of products that they license to companies in the channel, both on the agent side and on the carrier side. With that said, there’s no doubt that MasterStream – according to their own Web site – is in the business of licensing software that “instantly generates quotes and proposals for complex telecom services.” We recognize that fact and are looking very closely at our legal options. It’s currently not our intention to do anything to “damage the channel” or its ability to receive pricing information from carriers via MasterStream. Our main goal is simply to ensure we get our just rewards for our innovation and hard work.

CS: What bells and whistles does GeoQuote have that its competitors don’t?

LA: The overarching difference between GeoQuote and the others is the business arrangement that forms the underpinnings of the technology. Telarus actually sells for every carrier represented in GeoQuote. MasterStream and RPM do not have channel relationships themselves with the carriers – they function solely as a middle man between the actual agents and the carriers. Since Telarus is contracted directly with the carriers as a master agent, we have the ability to gain access to information under NDA that non-agents could never obtain. One such example is fiber routes. Most carriers with metro fiber networks are very sensitive about giving this information out, even to their own employees. Due to the fact that Telarus does a lot of business with our vendors, and due to the fact that we can control who sees fiber routes and who doesn’t, we were able to convince their legal departments to supply us that information. Without sales volume, many carriers would be impossible to work with as it relates to gaining access to information relating to pricing and availability of their products.

Another big differentiator is our diverse use of GeoQuote. We have integrated it with our customer relationship management software; agents can create new locations for existing clients and run new quotes for those locations at will. The quotes are then archived and attached to that page for future use. Similarly, agents can take the results of GeoQuote and pre-populate a PDF proposal for a customer using the pricing information they received from GeoQuote, making the proposal process a snap. In addition, we’ve created a “public view” version of GeoQuote that can be sent via XML to any of our agent’s own Web sites, empowering them with a lead-generation gold mine. Most non-Telarus sites (public-facing) will do nothing more than capture the prospects’ contact information and display a “we’ll contact you soon” message.

Lastly, GeoQuote contains promotional pricing which, in many cases, is unique to Telarus. Since Telarus is one of the largest agents with most of the carriers we represent, we are able to offer special bonuses and price points that we communicate to our agent community through GeoQuote. Along side of the special pre-approved discounts are the agents’ exact commission, in dollars and cents, as well as a carrier rating that has been determined by Telarus agent feedback over the past few months. If a carrier isn’t performing, Telarus agents who use GeoQuote will be aware – which is very valuable when an agents put their reputation on the line to issue a carrier recommendation to a client.

CS: Do any other master agents have similar systems?

LA: The main thing every master agent wants to know when they receive a quote request is, “What carrier can offer services in this location?” Although this is circumspect, I’d guess most of them have put together some spreadsheets or something to clue them in on which carriers are viable for a given opportunity. The main challenge comes when you become a premier master agent and your vendor count rises above ten. After that, automation is really the only way to profitably achieve that type of scale, which explains more and more master agents moving to a MasterStream-type of outsourced quoting solution. We foresaw the need for automation back in 2002, when the average price for carrier services was two to three times what it is now, knowing it would eventually become unprofitable to support with a strictly “human” back office. Now, with prices of some services dipping below the $300 mark, master agents are being forced to automate, abandon support lower-price services (single circuit T1/PRI), specialize in just a few carriers or a combination of the three to stay profitable.

CS: How many hits does GeoQuote get per day?

LA: GeoQuote generates around 500 quotes per business day. Around half of the quote requests GeoQuote receives are from public-facing agent Web sites endowed with the GeoQuote XML plug-in, and the other half are from agents doing research on behalf of their clients and prospects. Agents who pass a verbal interview, sign a Telarus agent contract, and commit to meet our minimum yearly sales requirement are granted full access to GeoQuote through a password-protected back office. Agents with full access to GeoQuote can see pricing, commission, vendor feedback, fiber maps, and many other features that referral partners and other non-premier agents can’t.

CS: What changes have been made to GeoQuote since the patent?

LA: GeoQuote has been and continues to be the foundation of our business plan. This is a mixed blessing as we have discovered over the years. Agents become so dependent upon GeoQuote that, in the off chance we have an inaccuracy or a vendor is lax in reporting new prices, products or services, we miss opportunities to sell. Now we are to the point where, if a product does not show up in GeoQuote, agents assume its not there. Out of sight, out of mind, as the saying goes.

We’re addressing this situation by adding increased human resources to ensure that we have the correct information and that it is integrated into the programming code in short order. However, as we’ve discovered, there are some vendors that struggle to get us the information we need, when we need it. Likewise, there are products that are complex in nature that, for the most part, will always require a manual quote lookup. This is where our recently released GeoQuote II comes into play. It shows the agent when a carrier does indeed offer services even though, for whatever reason, we do not know the price off-hand. GeoQuote II is a Facebook-style closed-loop system that enables direct communication between an agent and the carrier for custom pricing requests. The responses from vendors are measured and alerts are triggered if the “SLA due date” for a response is missed. This helps us keep track of every pricing request our agents enter and ensure that none of them fall through the cracks.

CS: Are any other patents in the works?

LA: All of our 38 claims were approved as of Feb. 10, 2009. Before the patent was issued, we filed a continuation application and plan to pursue additional claims with alternative scope.

CS: What are your plans to enforce the patent?

LA: We are continuing to review our options and may consider a licensing arrangement with those who we find are fitting candidates. When, where and how we are going to proceed is still undetermined, but we’re currently working with our lawyers to come up with a plan that works.

CS: Are we eventually looking at a world where the only way you can get real-time carrier quotes is if you’re a Telarus agent?

LA: Would that be nice! No, seriously, once we arrive at a license agreement with the appropriate companies, our competitors should be able to continue to operate just as they do now, albeit the rates they pay for the service could change to reflect the new license arrangements.

CS: Is there anything else you’d like to add?

LA: Telarus is still an enigma in the channel. People are still trying to figure out if we’re a master agent, a software development company, or an Internet marketing company. The reality is we’re all three – with a focus on sales volume. We want to be the center point for a remarkably large share of the market, and as our president, Adam Edwards, is keen to say, “We want Telarus to be a meaningful piece of each and every one of our vendor-partners’ revenue.” We’re investing heavily in software and sales support staff so that we can reach that goal; but to accomplish that, we’ll need to dominate the Internet for online leads, we’ll need to be able to sell large numbers of single-circuits through automation, and we’ll need to leverage our relationships and size to bring in the large deals through our new class of sophisticated agents. GeoQuote, and the patent we’ve been granted, represent just one of the many pieces we’re putting into place to help us reach that goal by 2011.

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