Comms Dealer

Greg Mesch, the tenacious founder and CEO of CityFibre, is a relative newcomer to the UK channel but he is already the instigator of a pure fibre infrastructure revolution and has chosen the UK's primary cities for his battleground.

A credible alternative infrastructure presence that provides choice and stimulates the disengagement of service providers from the UK's monolithic incumbents is an industry imperative, claims Mesch, the architect of CityFibre's project to provide such a stimulus. His strategic mission to create a true alternative has already justified CityFibre's headline investments and acquisitions, and Mesch is now expressing his priorities for high growth in partnership with resellers.

"For too long the UK telecoms landscape has been dominated by a single national infrastructure provider," said Mesch. "To compete with the rest of the world we need to ensure that there is choice and competition in the market. That's what we're doing. We are not just about providing like-for-like products over our independent network, but Gigabit as standard."

So who is Greg Mesch? He seems a man determined to redefine Britain's connected future and is busy mapping a route to reach the summit of his ambition. It could be argued that to become a real challenger to the likes of BT would be too high a mountain to climb, but the evidence of Mesch's progress and strategic advances so far, and his previous career achievements, suggest otherwise.

Mesch started out as a telecoms engineer and entrepreneur and has a strong background in the building of high growth fibre optic telecoms companies. He became Chief Operating Officer for ESAT Telecom in Ireland (which IPO'd on NASDAQ and was subsequently purchased by BT for over 1 billion euro). Mesch was also founder and Chief Operating Officer of Versatel Telecom which built one of the largest fibre-based infrastructures in the Dutch and German markets. Versatel also listed on NASDAQ and the Dutch AEX exchange and was purchased by Tele2 and Apax for over $1.5 billion.

In 2009 Mesch became Non-Executive Director of EU Networks before founding CityFibre in 2011 with Mark Collins through the acquisition of several established fibre optic businesses. Despite his glittering backstory, Mesch counts his biggest achievement as taking CityFibre from a fledgling IPO to its new position as the largest wholesale infrastructure provider after BT Openreach, in just two years.

CityFibre listed on the AIM market of the LSE in January 2014 raising £16.5 million and gained access to long-term funding opportunities. The company then raised a further £30 million following an over-subscribed private placing, taking the total equity raised to £46.5 million. In December 2015 CityFibre acquired KCOM's national fibre assets (excluding Hull and East Yorkshire) for £90 million and secured financing of £180 million, increasing its footprint to 36 cities and enabling CityFibre to target a total of 50 cities by 2020, reaching 20 per cent of the UK market.

"With the growth in data rising exponentially, pure fibre is the only truly future-proof infrastructure that can support it"

"We are a builder of Gigabit Cities, constructing modern pure fibre infrastructure in cities to serve CPs, SIs, local authorities, data centres and mobile operators," explained Mesch. "Our networks enable partners to use them in any way they wish, whether that's providing entry level active products or taking them on a journey to consume dark fibre and build their own on-net networks."

CityFibre's Gigabit City campaign kicked off with York and Peterborough, followed by Coventry, Kirklees, Aberdeen, Edinburgh, Glasgow and now Bristol. "These projects proved our model of city-wide wholesale fibre infrastructure and gave our investors the confidence to support us further in the acquisition of KCOM's national networks, helping us to reach scale and create a meaningful, national alternative infrastructure for the UK," stated Mesch.

Other developments of significance that underscore the strength of CityFibre's business model include the formation of a joint venture company in 2014 with Sky and TalkTalk to deploy a new Fibre-to-the-Home network in the City of York. Soon afterwards CityFibre signed the UK's first dark fibre-to-the-tower deal, a national framework with EE, Three and MBNL. And in October 2015 CityFibre sealed a Master Services Agreement with Vodafone.

The KCOM acquisition gave CityFibre an additional 1,100 km of metro network and 1,100km of long distance network, allowing it to connect to peering points in London and data centres across the UK. This masterstroke of an acquisition and subsequent funding shines as a signal victory for Mesch's rolling campaign convoy across the UK's infrastructure territory.

"We found it hard to offer partners the scale they need to transact at volume," he commented. "But with the acquisition of KCOM's national network assets we overcame that barrier and are much more relevant to our partners. By 2019 we aim to be the network infrastructure of choice in all of our local markets and have hundreds of CP partners transacting across our growing network, delivering state-of-the-art services to end users across the country."

That the reseller community will respond positively to Mesch's mission is already clear, evident in the high interest shown by existing and potential partners. "We are building awareness of CityFibre as an alternative for CPs," noted Mesch. "We're already working with tier 1 providers, local authorities, emergency services, mobile network operators and multiple business CPs, but the more CPs who come on board as partners the faster we can grow for the benefit of all. Building a very different connected future for Britain isn't just about us building network, it's about our partners making use of it.

"For a long time UK CPs, data centres and MNOs have been calling for a true, national alternative to BT. It's this demand that underpins our business model. Every major announcement we make and every press headline we get triggers a fresh wave of interest from potential new partners. Our job now is to convert this heightened interest, onboard new partners and give all of them a voice over what comes next. We believe that working in true partnership with no hidden agenda is what will keep our partners with us and make the UK communications industry great."

CityFibre now employs 105 staff and generates revenue growth of 115 per cent year-over-year. The company's turnover of £2 million at IPO now stands at over £36 million and rising. "We're rapidly expanding and have some of the best brains in the industry," added Mesch. "That said, we are still a small, close-knit group and our culture reflects that dynamic. None of us are here to be just like everyone else. 'Alternative' to us isn't just about our network, it's about everyone having the personal freedom to be fresh, creative, and even disruptive when we need to be. Because of that, absolutely no voice goes unheard. Everyone who works at CityFibre is passionate, energetic, driven and very busy."

Their joint priority is to exert a telling influence over the future of Britain's connected future by expanding CityFibre's pure fibre network footprint and increasing the addressable market for partners. "We are targeting major metro footprints and will open up our infrastructure to a broad range of CPs to maximise its use," added Mesch.

"With the growth in data rising exponentially, pure fibre is the only truly future-proof infrastructure that can support it. We need to plan for tomorrow. We're also investing heavily in state-of-the-art platforms to make sure our partners can do business with us easily and access all of the information they need. Building on these developments and evolving our systems to be truly world class is next on our list. We're agile, independent and here to stay."•

Just a minute with Greg Mesch...

Tell us something about yourself we don’t know: I’m a heli-skier 

What do you fear the most? Poor health

Name three ideal dinner guests: Steve Jobs, James Dyson, Neil Armstrong 

Role model: Jack Welch, former Chairman and CEO of General Electric

One example of something you have overcome: Being the youngest of five brothers

Your greatest strength and what could you improve on? I never give up: That can be a strength and a weakness 

What possession could you not live without?  My skis

How do you relax when not working? Cycling and skiing

Name one thing you couldn’t do without in your job: Coffee  

A new association that champions the benefits of working with regional EMEA technology channels and promotes new technology in business and society is being founded by four of the largest technology distributors in Europe: ALSO, Esprinet, Exertis and Westcoast.

It could be seen as a counter to the US-heavy Global Technology Distribution Council, although ALSO is already a prominent member of GTDC.

These have been some moves to encourage a more European stance in the GTDC, but global issues and standards - mainly US - have been seen to dominate its agendas.

The new association is called The Technology Channels Alliance. While its primary objective is to ensure that technology vendors understand and make full use of the benefits of working with channels that understand their local circumstances across EMEA, the association will also be enablers and advocates of new technology to ensure these channels are educated and optimised to deliver on the promises new technology makes.

At the same time, the association will have a social charter and will be setting aside a portion of its member dues to establish a charitable foundation with a mission to get technology to those without the means to acquire it, and enable a wider population to benefit from today's technology.

"I feel it's time to give something back," commented Joe Hemani, CEO of Westcoast. "Technology sales channels today are very good at getting products and services out to those who can afford to pay, what we want to do is give those without the means an opportunity to acquire technology that can change and better their lives."

Membership in the new association is open to technology distributors, large resellers and retailers whose head office is registered in a European country.

Niall Ennis, CEO of Exertis, said: "Regional players are a hugely important part of the technology channel in EMEA, and provide a focus and range of services tailored to each of the countries in which they operate.

'This new association seeks to promote the benefit to technology vendors of this focused approach and to provide a forum to identify opportunities to grow the addressable market for technology products."

Gustavo Moeller-Hergt, CEO of ALSO, added: "As well as being advocates and enablers of what technology can do for users, members of our new association bring special value to our customers because we are local, so we speak the language and do business in the language of our customers."

Alessandro Cattani, CEO of Esprinet, observed: "We have an ambition to create what we call a 'chain of knowledge' all the way from vendors through the channel to end users.

"Among other things, we will be publishing several case studies a year that will highlight issues of common interest in the region."

Avnet's Q2 update showed that revenue of $6.85 billion was near the low end of expectations, due to weaker demand in industrial markets and EM Americas and a softer-than-expected close at TS Americas.

As a result, revenue increased 6.4% sequentially after adjusting for the impact of foreign currency changes and the extra week in our September quarter as compared with the normal seasonal range of plus-10% to plus-14% growth, it says.

The EMEA region continued multi-quarter positive growth trend, as revenue increased 3.5% year-over-year in constant currency, led by continued strength in the electronics marketing business. Despite this EMEA performance, global organic revenue declined 5.5% year-over-year in constant currency, as the Americas region decreased 9.9% and the Asia region declined 9.5% in constant currency.

Gross profit margin increased 27 basis points from the year-ago quarter to 11.4% driven by improvements at TS across all three regions. In TS EMEA, a fourth consecutive quarter of year-over-year organic growth in core business in constant currency was offset by a decline in computing components as organic revenue declined 10.6% in reported dollars and 2% in constant currency.

Patrick Laurent Zammit - President - Technology Solutions: "We were a little bit surprised by, I would say, some softness in closing deals on storage. And to be very specific, it's legacy technology storage.

"In fact, if you look at the next-generation technologies like converged, hyper-converged or flash arrays, we grew very nicely, double digits, in some cases even high-double digits. So, here, we see traction. But unfortunately, the positives are not enough to offset the decline on the legacy storage technology."

In EMEA market conditions for the moment remain positive, he says. "I will just add that companies had delayed investments because of the sluggish market environment. They have a better visibility now, so they have to invest and they're investing.

"So, that's helping the market. In addition in that market, we continue to execute very well. I mean, we've made some management changes. And so, all the regions are now in - within Europe, all the regions are recovering nicely.

"We have some record results in some of the regions like Eastern Europe and Northern Europe. Central Europe continues to develop very well. And Southern Europe, which was an issue for us, is now turning around."

Cobweb Solutions has appointed Michael Frisby as MD. He joins from Microsoft and will work with Ash Patel, Director of Business Transformation to capitalise on Cobweb's enhanced status in the Microsoft Cloud Solution Provider Program as an indirect 2-Tier partner.

Frisby will be responsible for leading Cobweb's transition to a value-add cloud aggregator, reporting to Executive Chairman Paul Hannam.

In his role at Microsoft Frisby was most recently responsible for driving the transformation of the SMB Managed Reseller business across Western Europe to a cloud-first model.

Previous to his SMB role Frisby successfully built and led the Online Services Syndication programme, working with all of the major telcos across Western Europe.

Paul Hannam, Executive Chairman, Cobweb Solutions, said: "Michael's experience will accelerate and cement Cobweb's global position as a cloud aggregator as we move into new territories. It is a measure of the confidence he has in Cobweb's proposition that he has chosen to make this move."

Frisby added: "Cloud Services and Microsoft's CSP program are driving a significant disruption across the IT channel.

"Cobweb's nearly 20 years of experience as a cloud services provider means we have a massive opportunity within this changing landscape to create a new value-add cloud aggregator which builds on the deep technical and service delivery capabilities within Cobweb.

"This experience and depth of capability will enable us to help 1000s of traditional IT resellers and ISVs make the successful transition to reselling cloud services.

"Cobweb is a significant Microsoft partner with nine accreditations, and a 2015 Microsoft Partner of the Year Finalist with a consistent track record of delivering innovation, such as enabling the first UK customer to transact with Microsoft Office 365 through the Microsoft Cloud Solution Provider Program in 2015."

Cobweb deploys the Microsoft portfolio including Microsoft Azure and the Enterprise Mobility Suite together with its own Cloud services.

BT Group has announced a 24% rise in pre-tax profits to £862m in its Q3 results to 31st December 2015. Revenue rose 3% to £4.59bn.

Gavin Patterson, Chief Executive, commenting on the results, said: "This is a strong set of results with good numbers across the board. Revenue was up 4.7% this quarter, our best result for more than seven years. We are making good progress towards our goal of sustainable profitable revenue growth. 

"BT Consumer had a standout quarter, increasing its overall line base for the first time in well over a decade and capturing 71% of new broadband customers. Good customer growth in broadband, TV and mobile helped to grow ARPU by 7%.

"Customers like what we're offering, whether that's superfast broadband, Champions League football or mobile data bundles. BT Global Services also did well with good revenue growth in continental Europe and Asia.

"Fibre is underpinning the growth at Openreach with almost half a million premises taking up the service this quarter via dozens of service providers.

"The fibre market is highly competitive and growing all the time, which is great news for the UK economy.

"Our superfast fibre broadband network is available to well over 24m homes and businesses. We will help take fibre coverage to 95% of the country by the end of 2017, with plans to go even further.

"Our G.fast trials are progressing well."

Following its acquisition of EE, BT also announced a new organisational structure that will take effect from April.

There will be six lines of business. Two will serve consumers, two will focus on businesses and the public sector - one in the UK and Ireland and one globally - and two will provide wholesale services to other industry players.

The Wholesale and Ventures division, which provides wholesale services to more than 1,400 communications providers, will be expanded to include EE's MVNO business as well as some specialist businesses such as Fleet, Payphones and Directories.

Gerry McQuade, currently Chief Sales and Marketing Officer, Business at EE, will be its CEO.

Openreach will be unaffected by the re-organisation.

The six divisions will be supported by Technology, Service and Operations which is currently responsible for BT's 'core' networks in the UK and overseas, its IT platforms and its global Research and Development arm.

Howard Watson takes over as its CEO today, replacing Clive Selley.

A new IT and Mobile business unit within TSO will be led by EE's Fotis Karonis. Fotis will join Howard's leadership team as well as support Marc Allera as EE's CIO.

Patterson added: "We will operate a multi brand strategy with UK customers being able to choose a mix of BT, EE or Plusnet services, depending on which suit them best.

"The acquisition provides us with a chance to refresh our structure and we have done that by creating a major new division that will focus on businesses and the public sector in the UK and Ireland."

Oak has expanded its portfolio with Progressive and Predictive Diallers and a Media Blending Platform following its acquisition of the Adaptive business from New Media Software (NMS). Oak joint-CEO Phil Reynolds stated: "We've been building our new high-end call recorder and call centre reporting platform, OCP3, ready for a 2016 release.

"The acquisition of Adaptive couldn't have come at a more opportune time, as we can now include advanced dialling and media blending options in the OCP release."

Phill McGowan, MD at NMS, will continue to work in the telecoms industry as a business consultant. He added: "Oak and New Media Software share a common vision of a great future for the Adaptive Suite and, together with the investment and depth of reseller support that Oak brings to the party, I see an exciting future for the new version 10 Adaptive software."

All Adaptive staff have taken up employment with Oak thus allowing support and development to continue uninterrupted of the Adaptive Suite.

Reynolds added: "With more than 15 years experience in dialler technology, the team from NMS have a lot to offer Oak's channel partners and it's a pleasure welcoming them on board."

Joint Oak CEO James Emm is putting plans together for a national reseller roadshow of the Adaptive Suite.

He stated: "This product will create more opportunity for our resellers here in the UK as well as for our North American operation. These are exciting times with three new products in 2016, a high-end voice and data recorder called Clarify, version 3 of our award winning Evolve contact centre reporting solution, and now the new version 10 Adaptive suite."

Mitel has ramped up its play in the mobile enterprise with the launch of hosted voice over LTE, video over LTE and voice over Wi-Fi for mobile carriers (Mitel Mobile Cloud Suite).

The vendor has also introduced embedded mobile real-time communications for SaaS applications targeting mobile, real-time field service workers (Mitel Embedded Communications); a mobile-first, team collaboration solution with real-time native integration (MiTeam); and integrated mobile, M2M and cloud services for the health sector (Real-Time Healthcare).

These introductions are aimed at eliminating legacy barriers and enabling seamless, real-time communications and collaboration.

"The vision of the mobile enterprise we outlined in October is becoming a reality," said Rich McBee, CEO, Mitel. "We're taking that strategy a step further by enabling the mobile cloud - the backbone for seamless, mobile communications.

"Now, industries across the board, from healthcare to education to sports, can seamlessly bridge what was once a costly and inefficient dividing line between the consumer and enterprise network.

"This enables a workplace that is ready for the mobile future and the benefits of the connected world brought on by M2M and the Internet of Things (IoT)."

Diane Myers, Senior Research Director at IHS, added: "The influence of mobile and cloud applications is rapidly seeping into everyday enterprise communications in a way that is reshaping how, when and on what device work gets done.

"Mitel understands that, and over the past year has taken steps to address that transformation."

Mitel also added 20 new cloud partners in EMEA during Q4 2015.

There's a lot to be said for comparing the current employment marketplace with the Stock Market, as demand continues to outstrip supply for staff in the UK, writes Clive Jefferys of Telecoms recruiter, JMA Network.

Just like share trading, relatively little stock changing hands can dramatically increase selling prices.

When it comes to current employment surveys, recorded salary rises are based on relatively few people actually moving jobs.

Just like investors hanging onto their shares, people stick in their current role until they judge the moment is right to move.

The jobholder hangs on until the offer becomes too tempting to refuse.

There is another aspect to recruiting in a Bull market, highlighted by a recent niche recruiters meeting.

As the afternoon progressed, opinion became increasingly divided and thankfully, the bar opened early. Option Three beckoned.

Prior to this, I had listened to endless presentations about interview techniques, background checks, vetting procedures, due diligence and more. All the complicated things that big companies tell you is essential in the correct selection of candidates, but without any real explanation as to why.

All these complex processes pre-suppose an excess of candidates, the Bear Market, but in truth this is yesterday's news.

In today's world, the primary purpose of all recruiters is to introduce the right candidates to the right employers with all possible speed.

Doing anything else is just getting in the way. Employers are the best-placed people to judge who is right for their business, not the recruiter. Our function is to understand our target sector, to hunt, to network and then get the right people talking as soon as possible.

There was another divide on show in the bar that night. The process-heavy recruiters moaned that their best candidates were being snapped up by someone else, but the other recruiters said nothing and simply smiled.

When clients engage a recruiter's help it's because they've already exhausted their recruitment options. So when they are prepared to pay a fee, they want results and they want them fast!

Anything less is unacceptable.

Fidelity and Qubic have collaborated to offer partners a seamless fixed-to-mobile SIM Disaster Recovery solution and pre-Ethernet install connectivity aimed at SMEs.

The solution is based on a single device on site with all of the complexity held within Qubic's network.

Sean Dixon, Sales Manager, Fidelity, commented: "This innovation offers true mobile failover for wired office connectivity, creating a private network whether connected wired or wirelessly.

"This solution allows our partners to deliver and bill customers quicker. Working alongside our long-term partner Qubic we are launching an exclusive offering to the channel."

The SIM fits into a broadband router and in the event of a fixed line break the service will seamlessly flip over to a single network or multi-network SIM.

The SIM works via a private APN set up between Telefonica and Qubic's network, and the product is said to be a first for the channel. "The channel can earn revenue and margin quickly as a customer can be live within 24 hours rather than waiting 90-plus days for Ethernet services," added Dixon.

"The fixed IP on the SIM will be the same as the Ethernet service when delivered, thus reducing the IT and configuration cost for the customer once the wired connection is live."

Fidelity is one of four companies on Telefonica's Global Partner Programme and has been pioneering the channel launch of IoT and M2M services with the roll out of vM2M, which reduces three devices - tracking, PDA and mobile - to one.

Joe Papa, owner and Director of Qubic, stated, "Direct connection to our data centres of mobile data, without crossing the public Internet, is a significant addition to Qubic's managed hosted service offering.
"Qubic's fixed line services already connect directly to the data centre without crossing the public Internet, extending the LAN to remote workers.

"The mobile interconnect means that mobile workers or locations that don't have broadband can connect securely to the LAN in the same way and within the same IP range. The technology also allows us to provide secure mobile failover for fixed line circuits."

ShoreTel's financial results for Q2 fiscal year 2016 show total revenues of $90.4m ($90.6m Q2 2015) and strong growth in recurring revenues driven by partners.

Don Joos, President and CEO, commented: "Following the ShoreTel Connect launch we gained momentum with customers as our pipeline of cloud opportunities expanded.

"Our channel partners contributed a historically high portion of cloud bookings."

Recurring revenues, which consist of all hosted and related services revenue plus support revenues, represented 52% of total revenue and reached an annualised value of $189m, up 15% on Q2 2015.

Hosted revenues of $30.5m were up 20% year-over-year and 4% sequentially.

During the period ShoreTel completed its acquisition of Corvisa, a provider of cloud-based communications solutions, expanding its cloud services in Europe; and boosted its cloud presence in Australia with acquisition of M5 Australia.

"While executing these strategic objectives we generated solid profitability," added Joos.