Is Alteva The Model For The Next-Gen UC Vendor?

The migration from traditional PBX to hosted IP telephony can still mean frayed nerves and plenty of questions, but for PTR Baler and Compator Company, it couldn't come fast enough.

Philadelphia-based PTR, which manufacturers cardboard balers and waste compactors for retail clients, had an aging Toshiba phone system on its last legs, and according to Joseph Bennett, IT Director, upgrading that system would have meant about $30,000 just for a refresh. PTR's infrastructure -- also outdated -- would be another story in itself.

"In case of a fire or any building emergency, an in-house PBX system is one more thing you have to back-up and secure," Bennett told CRN. "If your building burns down, how fast do your servers get back up and running, and how do you get it to work fast? I need to have something so that if the building goes down tomorrow, I can have phone lines directed to peoples' houses or elsewhere."

Disaster recovery was one of many selling point as PTR's PBX overhaul became not merely a refresh, but a migration: it adopted a hosted VoIP solution through Alteva -- a fast-growing provider of hosted networking options sold through channel partners -- to handle its sales inbounds and round-the-clock service department. Its toll-free and local direct dial numbers now go through Alteva, and PTR uses Polycom IP430 and IP501 phones throughout its Philadelphia headquarters, with more phones headed for its satellite offices.

According to Bennett, he had a tough sell at first with PTR's financial managers, who needed him to explain not only the cost savings but also guarantee the stability of shifting important communications off-premise. During the evaluation process, PTR looked at Cisco, Mitel and Avaya PBX systems and also hosted VoIP offerings from Broadview and M5 Networks.

Next: What Sold Alteva

Alteva outgunned the competition, Bennett said, on both affordability and flexibility.

"Alteva had told us we'd see about $1,500 to $2,000 a month in savings, and what we realized was about $3,500 a month, which is a pretty good number off your monthly IT costs," Bennett explained. "On top of that, though, when you can program (the system) easily, when it redirects to your cell phone, when you can do it from home from a Web portal, and you can lose no call quality, the benefits start to stack up."

Monthly phone costs to PTR before the Alteva system was implemented ran about $6,700, but they were about $3,200 after. The hardware investment with Alteva upfront was about $11,390. Return-on-investment, Bennett said, was seen after about four months, and after a year with the Alteva implementation, PTR had realized $31,133 in total cost savings over its previous system.

Quality was the biggest concern at first, Bennett said, and PTR's management team kept on him about not sacrificing customer experience just to save money. Convincing them that they weren't losing call quality, he explained, was a process of constant demonstration.

"I've seen surveys that show hosted VoIP calls drop, but we're noticing that there's not a significant difference in what we'd lose with a copper network," he said.

Next: Other Implementation Issues

Infrastructure changes were another hassle, Bennett said.

"This is a 100-year-old business, and when we went in, we were pulling out three-inch-thick phone lines, many of which you forgot about and that you don't even use," he said. "These are dead phone lines. Some are fax numbers, some reach your security systems, some hit telemetric devices. So that takes a lot of uncoupling."

PTR's implementation was handled by Chorus Communications, a Philadelphia, Pa.-based solution provider and master agent. As recently as two years ago, hosted offerings comprised 5 percent of Chorus' total sales, but today, that number is nearly 75 percent.

According to Rob Molinaro, Chorus' owner, the solution provider is now averaging about one Alteva hosted deployment a week.

"Customers needed cost reduction and efficiency among the economic s---storm," Molinaro said. "They needed scaleability. So we embrace that. We were doing this when people were like, 'No way, hosted stinks, it doesn't work.' Two years ago that was the way it was. But you don't have maintenance fees with hosted and I think a lot of agents who didn't take it on are going to realize how shortsighted that was."

Next: Alteva's Flexibility Shines

"We do represent other hosted providers, but where Alteva shines is in their knowledge," Molinaro said. "There are a lot of folks out there who insist on blending the voice and data, which is a nice idea -- and is the future -- but for now, you have to have options for customers who want to keep things separate. You have to have an answer for everything."

Louis Hayner, chief sales officer at Alteva, says Alteva does. Alteva for example, interconnects its hosted voice and messaging options with Microsoft's Communications Services product suite, including Exchange Server, and OCS, now known as Lync, for SMBs and enterprises alike. Broadsoft and Level 3 provide SIP trunking and the rest of Alteva's carrier-class VoIP needs.

Alteva's hosted UC runs about $15 a user, priced a la carte, and also available in wholesale and white label arrangements for VARs, agents and integrators. The company continues to add options to its programs, too. In September, for example, it began offering IP phone rental to SMBs requiring 10 or more handsets, as a complement to its hosted UC service.

"Hosted and cloud are, depending on who you talk to, synonymous, and the problem here is that a lot of VARs didn't change before they've had to," Hayner told CRN. "Quite honestly, once your customers start getting involved with hosted solutions -- and it really is a more resilient and cost-prudent model -- you're able to maintain that customer even closer than before. Once you integrate the applications and they're accessible to everyone, the FUD goes away."

What sells most customers -- and did so in PTR's case -- is a trigger event, often the need to overhaul significantly outdated or inefficient phone systems. From there comes the cost conversation weighed against the types of unified communications features that can be had. One major benefit for VARs, Hayner emphasized, is to layer services on top of the offering once a UC platform, such as Microsoft's, and hosted VoIP are integrated.

"And look at this, you're a switch-less wholesaler, selling your own cloud, with ours in the background," he explained. "Suddenly you're not a telephony provider, but a cloud communications provider. We're still viewing the battle as on premise versus hosted, but I think that argument has been fought and won."