NEC-Intermedia Partnership: Execs Explain Their Cloud PBX Team-Up

Intermedia's CEO and the NEC Americas channel chief explain how their partnership is different.

Jeffrey Schwartz

June 12, 2020

9 Min Read
Handshake-male and female

After years of trying to roll out its own cloud PBX offering, NEC determined it needed to team with a UCaaS provider. After considering various players, the NEC-Intermedia partnership was born..

Why did NEC choose Intermedia over larger providers such as 8×8, RingCentral or Vonage to provide its UCaaS service? Intermedia started as a Microsoft Exchange hosting provider well before Office 365 was in the pipeline. The company launched its cloud PBX offering nearly a decade ago. Today UCaaS is the largest part of Intermedia’s business.


Intermedia’s Michael Gold

Intermedia CEO Michael Gold and NEC’s Americas channel chief, Marc Hebner, together discussed the NEC-Intermedia cloud PBX partnership with Channel Partners. The interview (slightly edited for clarity) took place via Intermedia’s AnyTime videoconferencing service.

Channel Partners: How is this NEC-Intermedia partnership structured?

Michael Gold: We have a unified communications platform with a cloud PBX, chat, video conferencing, file syncing and sharing – all the functionality that you would expect in an enterprise grade PBX – and a contact center solution. Our deal with NEC is to provide all of that on a white-label basis, so it will be NEC-branded. NEC will handle the sales, the marketing and the support. There are some other interesting technologies that eventually may be integrated with it from NEC. It includes some legacy NEC products, the on-premises PBX systems, that we will also integrate with to provide hybrid solutions. The core of the cloud product is the Intermedia platform.

CP: Has Intermedia done this before?

MG: This approach is not entirely new to us because we built our business selling mostly through partners. Eighty percent of our sales are through partners, and most of our partners buy under this reseller approach where they’re putting their brand on the product.  Most of our deals are private-label deals, but the one with NEC we’ve taken to another degree.

CP: When you say you’ve taken it to another degree, what does that mean?

MG: We’ve designed our product in a way that not only lets partners put their brand on it, but lets us sell it to them wholesale, and they handle the rest. For NEC, which has a great brand and global reach, it was more than just a business model. There’s a whole platform behind it that allowed NEC and NEC’s partners to run the business as if it’s their own.


NEC’s Marc Hebner

Marc Hebner: I think Intermedia has put a lot more work in this partnership that maybe they wouldn’t typically do. Michael alluded to the integrations that Intermedia and NEC are building between our legacy platforms and this new cloud offering.

CP: How does this cloud PBX partnership effect NEC’s channel?

MH: We’re going to market with three models, which is unique. As Michael noted, we’re working together on some of the customization and some of the other applications that we’re going to be building out here as part of our smart workspace framework. Intermedia is going to be a big part of that. It’s going to require us to be much more integrated than they probably have been with some of their other partners.

CP: What are your timelines for this?

Marc Hebner: We’re rolling out now. Initially we are rolling out with Poly and Yealink terminals. And we’ll have the NEC terminals ready to go end of June time frame. At this point, from an NEC standpoint, we’ve got a couple thousand channel partners here in the Americas. We’ve got about 80 million line subscribers, globally.

CP: Why has it taken so long for NEC to come out with a cloud UCaaS offering?

MH: We’ve had some false starts with …

… our own UCaaS platform over the years. We had a solid platform. But the challenge that we had was in the enablement, from a sales standpoint, channel enablement, training and portals. We very much struggled with building out that back-end infrastructure that gave us the scalability that we needed to really go to market. So we’ve been fighting that fight for six or seven years now. We finally realized over the past year that we need to move quicker into the cloud. And we needed something that is truly built in the cloud. We couldn’t build this ourselves and get the scalability and the speed that we needed.

CP: Once you came to that conclusion, what did you do?

MH: We started vetting the who’s who in the UCaaS space and evaluated those who may be interested in partnering, Obviously, with 80 million customers, everybody wanted to throw their hat in the ring, and we were very excited about the NEC-Intermedia partnership opportunity. Frankly, we had some offers from a financial standpoint that were more aggressive than what Intermedia was bringing to the table.

CP: So why didn’t you go with one of those?

MH: We partnered with Intermedia because they are truly channel-focused; their whole model is to sell their product through a channel. And that aligned with our vision and how we’ve been built here the past 50 years here in the United States, being 100% dedicated and focused on selling our products through our channel.

CP: Many of Intermedia’s competitors sell through the channel as well. What was different?

MH: We didn’t want to go to market with just an agency model. That takes some of the control over the margins the channel can make. And essentially, our channel would look at that as giving up their customer. The concerns that we heard from our channel partners were that they didn’t want an arrangement like RingCentral, where they pay a SPIF, and then the customer is with RingCentral. Our partners want to own that relationship. They’re managed service providers and they want this to be another service offering that they have. So we’re going to market it with three different models that our channel can take. One of them is a revenue share model; one of them as a customer ownership model. And then one of them is one of the more traditional models that you see in this space — the agency model.

CP: Why did you want to offer three models?

MH: We’re giving our channel huge flexibility on how they want to go to market with this product. If they want to take all the top line revenue, they can. If they want to control the margins that they make and add additional services, they can. But maybe they don’t want to do those things. And maybe they want NEC to be the face of this and they want NEC to manage the invoicing and have it be NEC-branded and do tier one, tier two and tier three support. They could do that too, under the traditional agency model. Ultimately, that’s why we selected Intermedia — they gave us that flexibility.

CP: As part of this NEC-Intermedia partnership, will the Intermedia brand appear with the NEC offering?

MG: No, I mean, NEC has such a strong brand. Intermedia has a good brand in the partner community but is less known at the business level.

CP: Will Intermedia provide the back-end support for NEC partners and customers?

MG: We pride ourselves on the quality of our support; in fact, that was another reason why NEC selected us. Particularly as a Japanese company, quality is king for NEC. We’ve won the JD Power award four years in a row for the for the quality of our product support. The other thing is that our product suite is so complete. Look at RingCentral, which is considered the market leader. Until a few months ago, they were using Zoom as their video conferencing technology, and they still use …

NICE inContact as their contact center technology. So, for NEC, it was important to them to have technology that wasn’t a bunch of different companies coming together. Having it as one-stop and tightly integrated was really important, and we offer that.

CP: I see you’re offering phones from Poly, Yealink and NEC. Why not just NEC?

MH: Just for speed. We have partners that are asking to turn up this service immediately. They want to sell it today. They’re thrilled, they’re excited, they’re ready to go to market. They want to sell it through NEC because they do all their business through NEC today. They want to leverage the channel enablement programs like our smart partner program for rebates and our coop program.

MG: Whenever we work with a new phone manufacturer, there’s some work to do to get the phones to work right with the product — and so that will be done in June.

CP: What NEC handsets are you offering?

MH: It’s the NEC SIP terminals that we’ve been taking to market.

CP: What percentage of customers do you see using handsets, considering many millennials in the workforce are content using their softphones or mobile devices if they can?

MG: I will tell you that for the Intermedia base, most people still use the physical phone. However, with the pandemic and remote work, I think you’re going to see a huge shift in that because now people realize that this stuff is really powerful. We track the usage of the different features of our product, and the usage of the true UCaaS features has gone through the roof since early March. I’m sure all of our competitors will tell you the same thing. I’m confident that when people get back to the office, they’re going to prefer this form of communication.

CP: What Intermedia software integrations will carry over to the NEC offering?

MG: All of  those integrations carry over to the NEC relationship. We have a variety of all the popular SaaS apps including Office 365 G Suite, file syncing/sharing and backup solutions. It’s deeply integrated in Office and G Suite. We also have integrations with all the popular CRM applications, including Salesforce, Microsoft Dynamics, Zendesk and ServiceNow and we’ve integrated with Teams and Slack. And then we have integrations with specific platforms such as ConnectWise and Autotask to make it easier for partners who use them for their professional services billing support.

Read more about:


About the Author(s)

Jeffrey Schwartz

Jeffrey Schwartz has covered the IT industry for nearly three decades, most recently as editor-in-chief of Redmond magazine and executive editor of Redmond Channel Partner. Prior to that, he held various editing and writing roles at CommunicationsWeek, InternetWeek and VARBusiness (now CRN) magazines, among other publications.

Free Newsletters for the Channel
Register for Your Free Newsletter Now

You May Also Like