What Was the Most Significant Development in the Indirect Channel in the Last Decade?

Channel Partners

December 22, 2009

5 Min Read
What Was the Most Significant Development in the Indirect Channel in the Last Decade?

“Revenue from it has quadrupled in that time period. Agents are now getting more respect from customers, providers, etc. That the first non-profit association was started and is thriving [is also a significant development].”

— Vince Bradley, CEO, World Telecom Group

“Placing orders via the Internet and using electronic delivery of documents is the most significant development in the indirect channel in the last decade. This allows for increased tracking, accountability and responsibility in getting orders and in getting paid.”

— Philip Josephson, Founder, the Law Office of Philip Josephson

“[The most significant development has been] consolidation, pure and simple. What occurred and created economies of scale inside the carrier world trickled down, hence the number of agents holding books of business has decreased significantly. As a result, even though the masters agents of the mid-‘90s have stayed intact, there is a new group growing like Telco Pro that will eventually hold a significant share of the market. Why? Because the consolidation has created a second tier of master agents that are no longer pricing shops. They actually have to support the agent the way the carriers used to.”

— Dan DiOrio, President, Telco Pro USA Inc.

“[The most significant development has been] the acceptance of the channel from the customer, followed by the establishment of large master agencies.”

— Geoffrey Shepstone, President, Telecom Brokerage Inc.

“MCI’s filing probably affected more agents financially than anything else happening in the agent community. M&A activity certainly affects agents and agent income, but MCI’s filing was massive.”

— Peter Radizeski, President, RAD-INFO

“I think real-time quoting is the most significant development in the indirect channel in the last decade but as that may sound self-serving, I’ll say the biggest change is the change from LD to data as the predominant product sold.”

— Adam Edwards, President, Telarus Inc.

“The channel grew up significantly in the last 10 years and went from being ‘promising’ to a ‘necessity.’ We went from being a team that has enormous potential to a group that knows how to win year in and year out. We now provide sales and support the carriers never thought would be possible from the indirect channel. The channel ‘arrived’ and established itself as a powerful distribution vehicle in the last 10 years.”

— Ted Schuman, CEO, PlanetOne

“Consolidation. The company you represent today may have a very different view of the channel once it is acquired. We have experienced this first hand on numerous occasions. Some experiences have been positive and others not as much. But no matter how you look at it, consolidation had a huge impact on the channel over the last decade.”

— Brad Miehl, President & CEO, MicroCorp Inc.

“Internet-based telephony or voice over Internet telephony [has been the most significant development].”

— Thomas K. Crowe, Partner, Law Offices of Thomas K. Crowe, P.C.


“In my mind, the most significant development in the indirect channel in the last decade has been the transition from selling POTS lines and TDM long-distance products to IP-based services, SIP-based services, MPLS, etc.”

— Benjamin W. Bronston, Partner, Nowalsky, Bronston & Gothard, APLLC

“It is hard to choose just one as the ‘most’ significant. A big contender is the multicarrier quoting engine. The indirect channel is the only segment who can gain value from it, and it did much to cause enormous growth for this channel, i.e., tools such as those developed by Telarus Inc. Just five years ago, the indirect channel had to concentrate on a handful of carriers and, typically, in their local geographic area. Who could qualify customers across multiple carriers and stay on top of the whole country as well as all pricing and promotion changes? The quoting engine with feeds from multiple providers opened up tens of carriers in full detail to a single agent. This, in turn, forced more carriers to recognize the indirect channel for its growing value and jump into the game. This allowed agents greater coverage and more sales. This brought more agents into the channel. The mushroom effect continued until the indirect channel gained the value and force it has today.

Another contender as the most significant development for the indirect channel in the last decade is simply its explosive growth. CLECs galore, without the billion-dollar advertising budgets of the ILECs, found a place to do business and discovered the indirect channel as a cost-effective way to market to customers. This caused larger, established carriers with a dedicated sales team to take notice and compete in the same channels to stop the flow to the CLECs.”

— Zachary Schechter, President, ZCS Enterprises

“The largest change over the last 10 years is that agents have truly become more of an extension to the direct sales forces of the carrier which is not unlike the IT indirect channel as well. From the late ’80s to early ’90s when the telecom agent channel started, agents were much more focused on selling voice LD service from MCI, Sprint, AT&T and Verizon and some smaller CLECs. This was a very transactional world and one where it was more about selling on price and availability than on a true solution, and that lasted really up until the early 2000s when the Internet really started changing the world. In the last decade, we have witnessed an explosion in the sale of IP services, colocation, managed hosting, private line, VPNs and more as the technology and security evolved and as prices became more affordable. This forced a migration for agents from the sale of pure commodity LD voice services to more advanced services that required far more technical skill in order to sell them. Carriers then added required certifications and training to accommodate and enable those changes. Finally, there are now on-demand online support tools built to greatly assist partners in the ‘self help’ model of working with their customers. All of these elements demonstrate that agent partners have become a growing part of the sales organizations of the carriers, and this emulates a lot of the model of the high-tech industry channel today.”

— Craig Schlagbaum, Vice President, Indirect Channels, Business Markets Group, Level 3 Communications

“It began with data and continues today with MPLS and Ethernet becoming much more readily available and inexpensive for the customer to implement, and I don’t mean to be repetitive here, but again the wireless industry has had a huge impact on the channel this past decade. Remember calling cards? Who really has one today? What about pagers? Another thing of the past, except in some specific situations.”

— J. Sherman Henderson III, Founder, President & CEO, Lightyear Network Solutions LLC

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