November 12, 2008, 1:23 AM — Solution providers and telecommunications carriers have never gotten along because of inherent conflicts. India-based Reliance Globalcom's alternative approach may just make it the first channel-friendly carrier.
Itâ€™s widely known that there isnâ€™t always a lot of love between solution providers and telecommunications carriers.
After all, carriers frequently abuse their ability to buy network gear in volume to undercut the prices of solution providers, they give solution providers a pittance of a fee for reselling their services and given half a chance they will try to supplant the solution provider when it comes to delivering managed services to end customer.
Given the relatively limited number of carriers in the market, there hasnâ€™t been much that solution providers could do about this. But as the carrier market place continues to change, one carrier that solution providers should start keeping an eye is Reliance Globalcom.
Reliance Globalcom, headquartered in India , is an international carrier making inroads into the U.S. market. As part of that effort, it has acquired companies such as Vanco, Flag Telecom and Yipes to create a new data business unit that is looking to partner with U.S. solution providers.
The fundamental proposition that Reliance Globalcom is making is that the carriers that solution providers are forced to partner with today are too inflexible and pricey to compete in todayâ€™s economic environment.
In contrast, Reliance Globalcom has built its service around a modern Ethernet infrastructure that allows it to make services available to partners to resell as extremely competitive rates. Those offerings include hosting, unified communications, security and application acceleration services in addition to traditional Internet and telecommunication services.
Reliance Globalcom makes no bones about that fact that it does sell its services direct to certain large enterprise customers and it has wholesale relationships with some carriers. But it is determined to increase its base of about 50 channel partners by providing them better margins on Internet and telecommunications services than what they get from traditional carriers and, when appropriate, is happy to augment whatever managed service they offering with any one of the services on the Reliance Globalcom sell sheet.
The one big difference, according to Reliance Globalcom chief marketing officer Keao Caindec, is that unlike other carriers, Reliance Globalcom harbors no ambitions for direct sales in the small to medium business market. Instead, they would leave that segment to the channel partners to pursue using lower cost services from Reliance Globalcom that would under cut the pricing of carrier rivals while still giving the partner better margins than they get from other carriers.
To put an accent on that point, itâ€™s worth noting that Reliance Globalcom CEO Anil Ambani is widely credited with taking the cost of an IP call down from 40 cents a minute to 1 cent a minute. So Reliance Globalcom has already established a pretty aggressive pricing position when it comes delivering telecommunication services. And given the size of the company, itâ€™s only a matter of time before it establishes a bigger footprint in the U.S. What that ultimately then means for solution providers is are they going to let this pending price war between carriers work for them or against them as the entire telecommunication services sector increasingly becomes a global market.