VoIPon: Broadcasting from various countries around the world using voice over IP technology, this is VoIP Uncovered — A VoIPon Solutions UK podcast. Representing, VoIPon, I’m Kathleen Reed.
Today, we’re happy to have the folks from Sangoma, a leading provider of hardware and software components that enable or enhance IP communication systems for both voice and data join us again today to bring us up to speed on the latest developments at their company.
Joining us today is Bill Wignall, their president and CEO and Jeff Dworkin, their director of marketing. Thanks for taking the time to talk with us.
So, I’m going to jump right in with the first question. In the last year, Sangoma has undergone a lot of changes; can you share VoIPon’s listeners what’s going on with the company and why the Sangoma channel and end users should be excited about these developments?
Bill Wignall: Sure Kathleen thanks. Well, 2011 is truly a year of reinvention for Sangoma. I came in to take over the reigns at Sangoma about one year ago, and since then, we’ve completely rebuilt the executive management team and established an entirely new strategic direction for the company. Even with the reputation of the highest quality products in the industry, the company’s evolution had slowed and we had experienced flat sales for the couple of years. The new leadership team has reignited the growth engine and that’s the big change internally at Sangoma.
But frankly, customers and partners don’t care so much about that. They care about new products, more engineering talent to help support them and their applications. They care about having Sangoma staff closer to them. That’s how we’re driving these renewed growth initiatives.
We’re focused on delivering more value to those customers and to our distribution partners around the world. We’ve begun to see some results in just the first three quarters together as an executive team our quarterly sales are about 30%.
We dramatically expanded our product road map; we’ve launched aggressive new marketing programs and hired key new experienced senior sales executives in regions closer to the customers. And we have begun expanding our addressable market beyond traditional telephony interface boards into new product categories to both organic initiatives and via selected acquisitions.
VoIPon: Okay. So, speaking of acquisitions, recently Sangoma acquired Vegastream effectively entering the appliance market, which by some had been long awaited and by others might be considered controversial. So, how’s the channel responding?
Bill Wignall: One of the fundamental objectives at Sangoma is to do exactly that: Diversify beyond the telecom interface boards market, a space in which we’ve been a dominant player for a number of years. Months ago, our executive team identified they are ready to deploy appliance market as one of those areas in to which we should to expand. So, you’ll see many new appliance space products from Sangoma over the next year. And that category is where gateways come in.
We actually plan to develop our gateway products ourselves. But once we got into the development cycle planning, we decided to needed these products now. Not in the year plus that would take us to build them.
So we decided to acquire Vegastream to expand our presence from our legacy market segments, which will remain critical for us. And Vegastream gives us a bunch of advantages: great products, an office in UK to better serve our European customers, and expanded distribution network with little overlap to existing partners.
Vegastream was stuck in neutral due to problems with manufacturing and supply chain management and Sangoma has a history of being really good at doing these things. We get new customers in a variety of geographic regions including India and Russia and we got an excellent team of both engineering and sales.
So, you could imagine with those advantages, the response from the channel is overwhelmingly positive. We have increased the options available to deliver on their customer’s needs. This expands the addressable market for those partners. Now, when a customer requires an external appliance, as part of their solution, Sangoma can deliver. We simply want it to be able to offer both solutions. Internal cards that get inserted into servers and external appliances, it’s that simple.
Kathleen: Fantastic. So, recently you announced revised pricing on the A500 BRI card and a firmware update that directly integrates with DAHDI, so the customers with lower density systems can effectively save up to 50% on the price of systems of 4 ports or less. Have you seen a shift to lower density systems in the EMEA and what other trends have come to light for this market?
Bill Wignall: Sure Kathleen. Well, Jeff, why don’t you take this one?
Jeff Dworkin: Sure. Well, since as Bill mentioned above are corporate objective for the coming years, 2012 especially, one of our goals is to build our key business in international markets. So, this was done in direct response to sort of better serve the European and generally, the entire EMEA market.
So, we recently hired a UK sales channel manager and this is one of the first things he sort of brought to the table, that we weren’t really getting the most bang for our buck with our BRI technology. We made these changes, they’ve sort of been on roadmap but they get crashed and accelerated, so we could better deliver on this very particular segment now. It doesn’t mean we’ve really seen a big shift to lower density systems. Again, it was more of just a response to what our channel manager saw: is that we were missing out on any of this lower density solutions and opportunities because we didn’t have this direct integration with the DAHDI driver for Asterisk. And, we were creating extra expense by requiring people to have hardware-based echo cancellation on these lower density systems, which is really necessary.
So, again, we lower the price, we fixed up our driver, and now we are really ready to attack this particular segment. So, this is really why it’s important that regionally placed sales people. You know, Steve came in and he really got a sense of what the local market needed and help us turn out into a product and hopefully new opportunity very quickly.
VoIPon: Fantastic. So, in terms of the market, where does Sangoma see the telephony marketing in general heading next?
Bill Wignall: Hmm, that’s a tough question Kathleen. You know, Sangoma doesn’t really focus on what the next single big thing will be. Our strategy involves selecting multiple products categories that target many of the key trends in our industry. So you will see us launch products that make use of the cloud and social networking, as just a couple of examples.
But if Sangoma had to prognosticate onto the year ahead, we’d say that perhaps 2012 will not be year, where we see a single new revolutionary technology, like tablets for instance. But rather might be a year of integration or update. We feel this way due to the fact that several new technologies have really just emerged recently, and because of the economic uncertainty, especially in Europe. When much financial uncertainty exists, companies and network operators tend to focus more on adopting efficiency improvements rather than on revolutionary technology.
So, offerings like SIP or VoIP will get fully more integrated into the fabric of business communications. Every business from the SOHO to the international enterprise will only be talking about when we will move to these technologies not if.
Newer offerings like the cloud or the tablet usage will move out of the innovation, pilot and early adopters phase and move into the mainstream of business regular operations. We fully expect Sangoma to benefit from those trends as well.
Kathleen: Ok, excellent. Well, I want to thank both of you for your time today and for bringing VoIPon’s listeners up to speed on the latest developments.
This has been a VoIPon, VoIP uncovered podcast. For more information, please visit www.voipon.co.uk.
