A good day unless your shorting the telco sector and long overdue!
Having had time to digest the reports I wanted to make some comments/observations:
1. The report mentions that Wholesale and Enterprise excluded SMB as that falls under the Commander brand, that is rubbish and indicates a concern I have that management does not understand the traditional strength of the VOC business. It’s actually the wholesale channel that serves SMB, the 3000-4000 brands listed in the yellow pages as a PBX or data networks provider. VOC does not have an in-house IT brand like Telstra has with FredIT or Bridgepoint, or Optus with Alphawest etc. Vocus have been good in wholesale at skilling up these providers who have their own value add, they really need to enhance that with channel programs and marketing. The more players you back, the better chance you have of winning.
2. A traditional weakness Vocus has is with international business and carrier relations. ASC gives them the ability to change that but I would like to hear more about investments in this area from a sales and marketing perspective. Their SEM is really poor, if you put yourself in the shoes of a potential international partner looking for connectivity or call termination, initial search results don’t indicate VOC is the player they are. Time to cash in on their recent submarine wins and promote themselves as a true tier 1 provider with suitable expertise. And that starts with getting the marketing basics right, using the right bait so to speak.
3. VOC is not a data centre player in today’s market to any great extent, in fact it’s been a distraction that we need to move on from, revenue is steady and the cost savings of using in-house facilities are unlikely to change.
4. I am glad short term incentives are gone, it’s a good sign. I also think not having a mobile play is good, it’s not a distraction to the important business of getting better at what they do and locking in those long overdue synergies from acquisitions of the past.
