Net2phone SVP Talks Acquisition, Latin America and the Future of the Desk Phone

Earlier this year, Net2phone bought Integra CCS, a contact-center-as-a-service (CCaaS) provider operating in the Americas and Europe. In many respects this was a natural fit for Net2phone, said George Longyear, senior vice president, channel sales and alliances. He emphasized that the company already had strong channel connections in South America, Central America and Mexico and that it continues to provide holistic solutions to that partner community.

Net2phone’s George Longyear

Net2phone, which provides VoIP and cloud computing-based telephone products and services, is a subsidiary of IDT Corp., a global provider of fintech, cloud communications and traditional communications services. The success of the Integra purchase was somewhat overshadowed by the company’s announcement last week that the board of directors has postponed the spinoff of its net2phone cloud communications segment. It had been preparing to spin off on or before July 31.

“The Net2phone team has achieved exceptional results bringing advanced cloud communication solutions to markets in North and South America,” said Jonah Fink, president of net2phone. “We remain very excited by Net2phone’s rapid growth, the transformational opportunities created through the recent acquisition of Integra, and the strength of Net2phone’s global channel partnerships.”

Longyear agreed with those sentiments and spoke to Channel Futures about why Integra’s purchase is good for channel partners. He takes on other topics as well, including the future of the office phone. Also in this interview, Longyear discusses why Net2phone was able to offer partners solutions for hybrid work, options available even before the pandemic hit.

Channel Futures: The common refrain I hear is that the office phone is disappearing, especially with the transition to hybrid work. What is your take on that assessment?

George Longyear: I would say that the need is diminishing for hard phones that sit on desks at this point. Requests that come through virtualized service, whether it be contact center, whether it be unified communications, or whether it be Microsoft Teams integration, require soft phones and not actually hard phones that sit on the desk. So I’d say that desk phones are here to stay for the time being. But it’s definitely leaning toward the direction of virtual and soft phones.

CF: Are you seeing sales drop for hard phones?

GL: I don’t think they’ve dropped. And if they have, it’s been minimal. You still have a good portion of potential customers that are very used to having a hard phone that sits on the desk. But I’d say we’ve seen maybe a reduction in the asks for a for hard phones. I can tell you that’s due to some of the overall shortage of hardware amongst the large vendors out there in the UC marketplace. There are the microchips, and the shortage on that piece of it has affected the supply chain.

However, you still have plenty of businesses that are doctors’ offices, hospitals that are not working remotely and still have that need for the physical hardware in an office location.

CF: From your previous interviews with Channel Futures, it seems that your company is doing well financially as a consequence of the pandemic. Have you’ve experienced a sales increase during this period?

GL: I would say 2020 was probably our greatest year because many people were pushed, whether they liked it or not, to a home office. So that required the ability to deliver services in a virtualized environment across geographies. I think that the Band-Aid was ripped off, so to speak. I mentioned Microsoft Teams native integration with Net2phone was a huge driver. We had just launched into that space and COVID-19 was an instant catalyst for that.

CF: Why choose Microsoft? What was it about that business relationship or decision?

GL: Other UC providers also did the same because Microsoft is so embedded. Such a large portion of the customers out there …

… use the software. I think we chose it because it’s the best means to solve a problem for outbound and inbound telephony and to service the largest number of potential customers. I don’t think there was any other real way to go.

CF: I know you have integrations with Slack. Why did you choose Slack?

GL: That’s a great point. We use Slack for internal applications. However, Slack at this point doesn’t allow for outbound or inbound telephony. Microsoft is ahead of them in that respect. And there’s been a lot of talk behind the scenes on when we’ll see a Slack application, but it’s just not there yet.

CF: Could you speak a little bit about the partner program as it exists now and where you see the channel in the next year to three years?

GL: We have just about all the NFL cities covered from a geography standpoint. We also have channel folks in South America, Central America and Mexico. I believe that the channel will continue to grow as companies see the value of third-party consultants over having their own direct sales force. They’re finding that a lot of their customers are gravitating toward outside brokers, consultants and managed service providers. They offer an agnostic view, as opposed to if a carrier has direct salespeople. The cost structure for customers tends to go way up. They’re not able to penetrate the potential opportunities like the agent program or the partners do.

CF: How many partners does Net2phone have now, and have you seen an increase since the pandemic started?

GL: I don’t know an exact number, but it’s been growing and continues to grow month over month, nonstop. We represent the master agencies across the country, and we have thousands of partners. Most are subagents, subpartners of the master agencies. We do have some direct partners as well.

CF: And then, can you talk a little bit about the acquisition of Integra CCS? What did Integra offer your company and customers that it didn’t have before?

GL: So, Integra is a contact-center-as-a-service platform based in South America. Net2phone continues to drive upmarket. We service the SMB all the way to the global enterprise. And as we continue to move upmarket, we wanted to take advantage of the intersection of UCaaS. Whether you’re a small business or a global enterprise, you have some components of the contact center that you require within your business. So it was a natural fit for us. We’ve had success in South America. Integra has an extremely robust platform. It was a very synergistic combination with our existing UCaaS platform. So it just gives us an extra depth to move into the enterprise space for contact center.

CF: Is making this acquisition a seamless process for you to enter this market?

GL: It’s a good marriage because we already have a robust platform from a U.S. perspective. We have our own underlying network for voice transport, which married very well with a developer platform for contact center. It’s the integration part that is always the challenge. But at the end of the day, it’s a good marriage. It won’t take as long as a typical integration would take on another type of acquisition. Most of the components are already in place.

CF: If there’s one thing you wanted partners to take away from this interview, what would that be?

GL: We have a robust unified communications platform we service across the whole spectrum, from small to medium-size businesses all the way to multinational operations that operate on just about all the continents. We have one of the largest – if not the largest – voice network, internationally. So it’s a lot easier for us to …

… bring the world together in a sense on one platform than some of our competitors. I would say that aside from an extremely competitive program – agent, partner program in general – that we have a lot to offer partners from geography and from ease of doing business in other countries.

CF: Why do you think you have accomplished this? What was it that Net2phone had in place to make these acquisitions or business partnerships work better than, say, a competitor?

GL: Well, we’re in a third generation of our product right now. From a UC perspective, we tried to make things as easy as possible for an agent partner to sell and for a customer to really understand. That is giving the most to the customer for an extremely competitive price without charging for 100 types of add-ons. It just makes everything a lot easier for a customer to understand and to navigate through as far as self-service portals and managing their own business. The training curve is not that high. I’d say ease of doing business was probably our biggest catalyst to success, and making our products very easy to navigate.

CF: What was it that made you so quick to adapt through virtualization?  I’m sure you, like everybody else, didn’t know the pandemic was coming your way. So what was it your company had in place to really be well prepared?

GL: I think that from a unified communications standpoint, everything is inherently moving to the cloud. Everything is being virtualized. I think at this point it was just a matter of continuing to build into the inside the platform and for pushing services into dispersed environments. I guess the easiest way to say it is that we were already doing that when COVID was sprung upon everyone. It’s just caused us to accelerate development in those areas quicker. And I keep bringing up Microsoft Teams. We’ve married this Teams native integration into our UCaaS platform. It allowed us to not only assist customers domestically, but we pushed services out globally in an extremely efficient manner.

CF: Anything else that you feel the reader should really know?

GL: Most partners have heard our name. We’ve made an impact in the domestic market here in the United States and in Canada, but in South America as well as in Europe. We continue to grow. We have our own development teams in-house. So, we’re nimble, we’re able to make changes very quickly to adjust to the growing needs from the consumer. COVID was a perfect example. We were able to pivot very quickly to give customers almost an instant move to virtualization with minimal downtime. You can call it good luck, or you can call it foresight. But it is that ability to make decisions very quickly and be nimble that has really been important for us.

The pandemic, as unfortunate as it is, moved business in a direction they already were going in. Businesses probably already knew the benefits of moving to a cloud or hosted solution, but it was kind of like “nice to have” versus “easy to have.” And then it very quickly became a need to have. So, partners who weren’t already selling a UCaaS provider or service became very interested in learning about what the benefits are, how to position it, and how to react to that customer demand. I would say 99.9% of indirect channel-based sales partners typically flocked to us. We have the time and the resources and the tools to train our partners and enable our partners with the materials to make them successful. We’re not too busy selling the solution ourselves to customers. We rely on that channel partner network to be that sales team for us.