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July 26, 2013
Declining voice revenues are playing right into the hands of Alianza Corp., a service provider launched to provide the voice component of wireless broadband networks -- so much so that it has now fixed its sights on a range of wireless and wireline players, including cable operators no longer willing to operate their existing voice technologies.
Although over-the-top players such as Skype Ltd. pose a threat to both wireline and wireless voice, few service providers are considering a data-only option to date, even as everyone ponders how to generate enough voice revenue to cover costs. That's where Alianza hopes to play a bigger role.
Now known as a wholesale cloud voice provider, Alianza gave clear signs this spring that it was gearing up to do more when it brought on Mark Gardner as VP of Global Sales and Kevin Mitchell as VP of Marketing. Less than a week later, the company announced a partnership with Level 3 Communications Inc. that combines Alianza's cloud-based voice platform with Level 3's network in creating a wholesale cloud voice offering. (See Alianza Appoints Execs).
And that wholesale offering is targeting a broad swath of service providers that no longer see the value of operating their own voice networks, says Mitchell, well-known in the industry for his marketing work at Acme Packet Inc..
With margins on voice services shrinking, more service providers are finding that the cost per subscriber of operating their own voice networks is actually higher than buying a cloud-based solution, Mitchells says.
"Even if they've spent the capex to build a network, the cost per subscriber of running that network, including the maintenance fees associated with it, are higher than what they would spend using our solution," Mitchell says. "On an ongoing basis, we can improve their margins," he claims.
By using a cloud-based solution, service providers eliminate capex and generate profits from the outset of deployment, he says. The decision to move to a cloud-based model is even easier for companies whose voice gear is nearing the end of its lifecycle -- and that includes some telcos.
"Eventually some of this equipment hits end of life -- either vendor stops supporting it or it lacks the functionality needed today," Mitchell says. "That's true for a lot of the VoIP 1.0 gear today."
Alianza got its start as the voice component of carriers such as Clearwire LLC and Open Range Communications Inc., and it has retained its interest in wireless, though it is now focused on LTE rollouts. Those companies are initially focused on building out a network and supporting data but they will eventually be adding voice: Outsourcing that voice component will be an attractive option because of the cost factor, suggests Mitchell. (See Mobile VoIP: No Profits, Big Problems).
Even when outsourced, though, the voice service still seems like it is managed by the service provider, which signs up customers using its own back office (OSS and BSS) systems. The information gathered by the service provider is then passed via an API (application programming interface) to Alianza, which activates the service.
Cloud-based voice services are quite common today for SMBs and enterprises. In fact, the market is quite competitive. Alianza hopes to carve out a very different niche, but it faces competition from a variety of other outsourcers that aren't doing cloud-based solutions, including the wholesale divisions of most CLECs and other software-based VoIP specialists such as wholesale service providers, such as BroadSoft Inc.
— Carol Wilson, Editor-at-Large, Light Reading
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