A Distributor's Disruptive Journey

For half a century, a good distributor was about effective and efficient picking, packing, and shipping. Telecom distribution wasn't particularly unique. The inventory largely consisted of specialized hardware including phones provided to authorized dealers. Distributors provided direct access to inventory, financing, and sometimes training.

Not all telecom equipment makers utilized third party distributors. Some did it themselves, and some did it through wholly owned subsidiaries. That was the case with Iwatsu Voice Networks, a wholly owned subsidiary of Iwatsu Electric which performed exclusive distribution of Iwatsu's PBX equipment in North America. In addition to traditional distribution, Iwatsu Voice Networks also developed applications for Iwatsu's Enterprise Communications Server (ECS) line. These applications provided advanced solutions for specific vertical markets.

Over the past decade the industry experienced significant change. Iwatsu Voice Networks found its development capability increasing in value, while its line of traditional PBX equipment decreasing. To complement its portfolio, the distributor forged a relationship with Alcatel-Lucent in 2010 largely focused on its OXE telephony solution.

In response to the building momentum of UC solutions, the distributor's executives Kevin Kelleher and David Carissimi had a radical idea. In March of 2011 they pitched and sold a tail-wag-the-dog concept and bought the U.S. company. Well, sort of, actually ICON Voice Networks was formed which soon acquired the assets of Iwatsu Voice Networks and resumed the distribution role. However, the new company had broader more aggressive plans around UC. After evaluating several partners, it decided to expand its relationship with Alcatel-Lucent.

ICON saw the capabilities of the Alcatel-Lucent UC solution as well as its integration opportunity, and decided to make Alcatel-Lucent central to its strategy -- specifically the Open Touch portfolio. ICON and Alcatel-Lucent's vision of the future aligned around UC and cloud services.

With a little assistance from Alcatel-Lucent and a CLEC partner, ICON has begun hosting OpenTouch Enterprise Cloud in its own data center. The service is intended for resellers.that to provide cost-effective, secure UC as a service. OpenTouch Enterprise offers a collaborative experience from a wide range of user devices including desktop computers and iPads. Last March, ICON Voice Networks was named as Alcatel-Lucent's strategic partner in the United States for its OpenTouch Enterprise Cloud implementation.

Kelleher expects to see significant growth from its Alcatel-Lucent relationship. The product and service portfolio will drive product sales, hosted revenue, professional services, and application development for ICON. Regarding applications, ICON has specific expertise around education and health care that it intends to leverage. Today, the firm's revenue from custom development is about 13 percent of its revenue, but Kelleher expects to see that more than double in the near future.

ICON is enjoying a tight partnership with Alcatel-Lucent as both firms have a vested interest in nailing the cloud service model. For ICON, it represents a transition from a traditional distributor to UC cloud provider. ICON expects its hosted UC offerings to become a major part of its business with both existing and new resellers. It is currently expanding into multiple data centers. For Alcatel-Lucent, it is a matter of maturing its cloud model which it sees a critical part of the future of UC. Alcatel is providing ICON professional services to assist with building-out its offer and put specific focus on the billing system.

To learn more about ICON, and the OpenTouch experience, try this free demo that ICON is offering here.