Verizon Pulling The Plug On Idle Agents

The New York-based carrier inherited a plethora of "idle agents" from its January merger with MCI, and that unproductive group isn’t needed, said Kathy Koelle, senior vice president for business solutions sales and marketing at Verizon. MCI didn't do a good job of managing the performance level of its master agents or their subagents, she added.

"The numbers are very large, and they are absolutely [mostly former] MCI partners," Koelle said of the agents being let go.

Verizon is dismissing some of its own idle agents as well, according to Koelle. The carrier disclosed its plans in two separate conference calls with Verizon agents and MCI agents on Thursday, she said.

The concept behind the decision is "fewer and better," explained Koelle. "I don't need a thousand partners. I probably need 100 to 200 of the right partners," she said.

Also driving the house cleaning is the need to make room for more of the type of agents Verizon would like to add: solution providers selling products and services beyond the narrow line of voice services offered by traditional agents, Koelle noted. "I want people who are in business to provide other value to their customers," she said.

Verizon is "definitely making a shift to a more solution provider model," but the carrier doesn’t plan to create a separate program for VARs that differs from its agent program, Koelle said.

Verizon is an MSP to many of its enterprise customers. The telecommunications giant also is aggressively pursuing a midmarket managed-services strategy that will add to its hosted, managed Internet services things like remotely managed IT services, Koelle said. This year, Verizon plans to offer midmarket managed services that handle routers, servers, firewalls and PBXs, and an MSP offering for midmarket storage is expected in 2007, she said.

Solution providers that become Verizon agents can resell the MSP services to their customers as branded Verizon services, which the carrier will bill for directly, Koelle said. Verizon is still finalizing details on whether solution provider agents would be able to engage with MSP customers to initiate contract renewals before the carrier does, she said.

For a typical deal that involves an agent, Verizon pays from 20 percent to 25 percent of the commission up front, with the balance paid out in monthly installments over the length of the deal’s contract, she said.

With the merger between Verizon and MCI completed only recently, it's likely that more changes are upcoming, said John Costoulas, vice president of operations at ADCom Solutions, a master agent and solution provider in Norcross, Ga. Costoulas was on the Verizon conference call with agents and said he sensed that the carrier has more changes up its sleeve.

"The more the questions came in [from participants in the call], the less confidence I heard from that [Verizon] team that there would not be some more changes," he said.