Vonage-Telesphere Pairing: This Isnt Consolidation This is Totally a Growth Story

CEOs Alan Masarek and Clark Peterson talk to Channel Partners in an exclusive interview about what Vonage’s recent $114 million purchase of Telesphere means for agents, VARs and MSPs.

Kelly Teal, Contributing Editor

March 17, 2015

5 Min Read
Vonage-Telesphere Pairing: This Isnt Consolidation  This is Totally a Growth Story

Kelly TealCHANNEL PARTNERS — Don’t think of Vonage as just a consumer VoIP provider.

That’s the message the company wants to get across to partners this week. To help achieve that goal, Vonage is sharing its booth (628) with Telesphere, the business-centric VoIP supplier it now owns.

Vonage bought Telesphere last year in a $114 million deal that both say only bodes well for the channel and for employees. That’s because Vonage has made concerted efforts to bulk up its business holdings, first with the 2013 Vocalocity buy that gave it heft in the 50 lines and fewer market, and now with Telesphere, which it allows to target high-end customers.

“The business opportunity is pretty profound,” Vonage CEO Alan Masarek told Channel Partners in an exclusive interview. “In terms of the move from on-premises to the cloud, the market is a legitimate 15-year growth story.”

“We see it in some respects as a land grab,” he added. “There’s lots of growth and we want to invest, covering the range from 1-1,000-plus. … The market is very underpenetrated.”

To capture as much of that hosted VoIP and UC share as possible, Vonage snapped up Telesphere in a move that CEO Clark Peterson said should come as good news to agents, VARs and MSPs.

“We first viewed Vonage as a consumer company but … this is better than any partner we could have arranged,” Peterson said.

Given Vonage’s foundation – it was the first major consumer VoIP company; it holds a number of patents; and it trades on the New York Stock Exchange – the deal made sense, Peterson said.

In fact, he noted, Vonage’s financial standing enables Telesphere “to really turn the faucet on in a big way here for our indirect channel partners.” Think marketing, project management, customer support, as just some examples. In other words, partners should have no fear that Vonage will defang Telesphere or its channel status.

“Unlike a lot of deals, this isn’t consolidation,” Peterson said. “This is totally a growth story.”

For clarity, consider that Telesphere is not actually part of Vonage Business Solutions – that’s still just Vocalocity. Telesphere remains a standalone company and the go-to division for large, up-market sales, with the financial and strategic backing of Vonage.  

Underscoring that point, Telesphere did not “let go a single person in this deal – in fact, we’re looking to hire 120 new people,” said Peterson. To wit, 30 employees were added just in the first two months of 2015.

Now, with Telesphere under its umbrella, Vonage expects to ramp up its channel strategy and is using this week’s Channel Partners Conference & Expo to help do that.

“The channel is critically important to us,” Masarek said. “We want to be hugely successful …

… in the channel.”

One way it plans to accomplish that aim is to pump a lot of money into its “Vonage Means Business” endeavors. Indeed, Masarek said Vonage needs to do a better job of differentiating its offerings via Vocalocity and Telesphere.

“The challenge is we do have two businesses servicing a common indirect channel and we need to work on communicating that story – this is about growth, the support is going to be even better than in the past … and we need to make that clear,” he said.

Still, partners may have some questions about operations and impact. Peterson said the most immediate, obvious effect of the Vonage deal comes in the number of channel managers. There now are 25 around the country and, by the end of the year, there will be 34-35, he said.

“Whether you’re a master agent or a subagent, an indirect channel manager will be very involved with their business,” Peterson said.

Telesphere partners also will continue using the company’s back-office system, Zeus, for quoting, order status, MACs, trouble tickets and more (by the way, Zeus also works on mobile devices now. Telesphere will be showing off that capability this week.).

When it comes to finances, “we’ve gotten very aggressive” with payouts, Peterson said, and that’s not going to change with Vonage as owner. Instead, there will be MDFs, SPIFFs and events such as Webinars, lunch and learns, email blasts and other collateral to solidify current partners’ up-market sales efforts and to attract new partners such as data VARs and MSPs.

“[Partners are] still going to get the quality they’ve come to expect from Telesphere and now there’s someone investing in this brand,” said Masarek.

Plus, said Peterson, there’s a side benefit. In the past, agents had to sort through the complexity of finding different carriers and services for different sizes of customers. The Vonage-Telesphere pairing eliminates that headache, he said.

“The main message is one solution from one provider that really can handle any of their services anywhere in the country in a totally united fashion,” Peterson said.

Masarek agreed.

“This is about moving the Vonage brand to … being both a consumer and business brand, and bringing all those assets to the channel,” Masarek said. “We’ll continue to be a multichannel company … [with] a single brand that provides different products to these segments.”

As more enterprises and organizations adopt cloud communications, Vonage and Telesphere want to capture as much of that spend as possible. Keep an eye on their channel program to see how they help you do the same.

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About the Author(s)

Kelly Teal

Contributing Editor, Channel Futures

Kelly Teal has more than 20 years’ experience as a journalist, editor and analyst, with longtime expertise in the indirect channel. She worked on the Channel Partners magazine staff for 11 years. Kelly now is principal of Kreativ Energy LLC.

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