Intermedia Seeks Deeper, High-Margin Relationships With Partners In Drive To Be UCaaS Market Leader

Partners stand to make 25 percent margins selling Intermedia's new Unite Unified Communications-as-a-Service platform as the vendor sets its sights on doubling in size in the next three years and dominating the SMB UCaaS market.

"I'm looking to go deeper with our partners, to build a business," Intermedia Chief Revenue Officer Eric Martorano told CRN at The Channel Company's XChange Solution Provider 2018 event in Orlando, Fla., Monday. "I'm looking for an opportunity for Intermedia to become a greater share of our partners' business. To do that we have to put the right product in the market, but also enable those partners to be successful. The only way we're going to double our business is with partners by our side and going deeper with them."

Intermedia's new Unite UCaaS platform is vital to its growth strategy, and Mark Sher, the Mountain View, Calif., company's vice president of unified communications products and marketing, said he expects partners to make 25 percent margins selling the offering. Unite is available to partners at between $15 and $20 per month, per user, Sher said.

The UCaaS market is expected to grow at about a 20 percent annual rate to about $15 billion in five years, Martorano noted during an XChange keynote. In the process, privately held Intermedia has its sights set on doubling in size in the next three years, and putting distance between itself and competitors like 8X8 and Ring Central, Martorano told CRN.

Partners will be crucial to achieving that goal, Martorano said, and the company, which does about 80 percent of its business through the channel today, is committed to a partner-focused strategy.

"Our competitors say they focus on the channel, but at the end of the day, it's a lot of talk," Martorano said. "With Intermedia, what you'll see is action. We're present in over 30 channel industry events, by far greater than any of our competitors. We won't attend a direct event without our channel. It's 100 percent commitment to the channel community. We have resources in readiness, in the concierge desk, in marketing and partner account managers, field resources, all 100 percent dedicated to the channel. That's something that none of our competitors can talk about."

The Unite platform is an all-inclusive cloud-based phone system that integrates desk phone, mobile phone and desktop technologies, including videoconferencing, collaboration, voice-mail transcription, fax, storage and cloud backup. The system carries a 99.999 percent service-level agreement, and users can set their own SLAs when dealing with their customers, Sher said. The systems can be configured and ordered online, and Intermedia is including a variety of training and enablement options for partners in the system's base price.

Unite can also be sold either as an Intermedia product, or under partners' own brands. In the private-label version, partners set prices on a deal-by-deal basis and do their own billing.

Intermedia provides sales and technical support for the platform, a sales concierge desk for partners, as well as customer on-boarding and training.

By including a complete suite of partner training, enablement and support services, Intermedia is hoping to take some of the confusion and uncertainty out of UCaaS, and prompt more of its 6,600 existing partners that aren't yet selling UCaaS to get in on the opportunity, Martorano said.

"It's about getting over the fear of getting involved because of the complexity, the perceived complexity, because it's really not," Martorano said. "If you're going in all by yourself, it could be complex. If you don't have a partner like Intermedia it might be difficult, but at the end of the day we make it so easy. Our model makes it easy for the channel partner to get involved. Some partners aren't even used to a recurring revenue model, so it's moving their business to a recurring revenue stream. We help the partners through that entire process.

"We have north of 6,000 partners, but not all of them are selling UCaaS today," Martorano said. "So just within our partner base, we have an opportunity to recruit and take partners along on the UCaaS journey. We started off as a hosted Exchange company, and over the years we transformed. Now we're moving to this unified communications and collaboration company. There are still a lot of partners that are just doing email, or just doing security and compliance. ... Within that 6,000, there's such a huge opportunity to get partners to move."

Intermedia's message resonated with Bernard Devroe, director of IoT and cybersecurity at CieloIT, a Lubbock, Texas, solution provider that works with one of Intermedia's competitors. Devroe said the simplicity and potential profitability of the Intermedia Unite offering could convince CieloIT to switch to Intermedia for UC.

"We're not a partner currently. We're with another vendor, but they've been having some issues," Devroe said. "We've been looking for another provider in case we decide to leave them." Intermedia's all-inclusive platform and commitment to drive it profitably through the channel while providing comprehensive support, services and partner enablement grabbed Devroe's attention.

"It stands out because it seems like they're going to help us more than our current provider does, and that kind of reliability is important to us," he said. "My philosophy is keep it simple, and if we can simplify it to the point where customers feel empowered to make changes on their own, I'm all for it."