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Chicago VAR becomes hosted VoIP services provider with Siemens

By Jessica Scarpati
04 Nov 2009 | SearchNetworkingChannel.com

Channel News Update
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Not only did Curt Sesto need to do something about the decaying 14-year-old switch in his phone system at a hospital in northern Illinois, he was also sick of juggling a dozen different phone bills for mobile phones. He was looking for not just a great voice over IP (VoIP) product but a hosted services provider to own and manage the infrastructure in the background.

"We actually had very nice conversations with all three of the major vendors -- Siemens, Avaya and Cisco -- and we really felt more comfortable not only with Siemens [Enterprise] but their partner here in the area," said Sesto, director of construction management and telecommunications of Ottawa Regional Hospital in Ottawa, Ill. "They came in and helped us and really did the legwork…. We could tell right off the bat they were going to do a better job than everyone else."

We really felt more comfortable not only with Siemens [Enterprise] but their partner here in the area.
Curt Sesto
Director of Construction Management and Telecommunications, Ottawa Regional Hospital, Ottawa, Ill.

The local partner, PosTrack Technologies, began 25 years ago as a turnkey solution provider for proprietary software and hardware point-of-sale systems, but the company eventually expanded that expertise into telecom, according to Chad Schumacher, director of marketing at the Joilet, Ill.-based company.

Four years ago, PosTrack waded into hosted services and selected Siemens as its flagship vendor, most recently by reselling the company's software-based VoIP product, OpenScape Voice, to run over its multiprotocol label switching (MPLS) network.

Becoming a hosted VoIP services provider

When PosTrack executives decided to transform the company from a turnkey solutions reseller to a hosted VoIP services provider, they had to expand both staff and infrastructure. The company has tripled in size since the transition, Schumacher said.

"We brought in people who had been there for other large telecommunications companies," he said. "Some of the team is from Siemens, Motorola and Polycom. A few of them are entrepreneurs that have built their own telecommunications VAR [business]…. It came down to acquiring a group of excellent team members who had been there, done that and provided their expertise."

PosTrack also has aimed to boost customer confidence in its ability as a VoIP provider by supporting its services not just by its own MPLS network but by rented space in data centers with Level 3 Communications and Equinix, as well as data services from AT&T and regional Internet service providers.

Small to medium-sized businesses make their decisions on cost, Schumacher said. Especially when it comes to voice products, enterprises choose integrators based on reliability and continuity, he said.

"We're building multi-node redundancy into our data center platforms to make sure we can provide services where the enterprise expects," Schumacher said. "Not to say other providers don't have a robust network … but their offerings and their business models are focused on a large number of small-business customers."

Choosing a vendor partner: Technology versus market share

While the Siemens name isn't necessarily synonymous with market share [in the United States], we make our decisions based on the functionality of the system.
Chad Schumaucher
Director of Marketing, PosTrack Technologies

"While the Siemens name isn't necessarily synonymous with market share [in the United States], we make our decisions based on the functionality of the system," Schumacher said. "While they were somewhat of a European company, there's also a fair argument to be made that a lot of the innovation that's happening in this market is happening in Europe."

Shifting strategy made sense for the Chicago-area company as a dichotomy began to appear in the market: More enterprises were looking for IP-based phone systems, but they lacked the staff, budget or interest in managing or investing in the necessary infrastructure.

"Instead of large upfront investments in their infrastructure and long-term commitments to maintaining that infrastructure in-house, they were able to use a hosted model, which made for a simple and straightforward business model," Schumacher said.

"What really enables us to create such a cost-effective story … is our ability to aggregate these platforms and really get to a point where there [are] some economies of scale associated with it," he said. "We're taking advantage of the scalability of the hardware and making it a truly software-based solution for the customer, as opposed to the customers figuring out their [return on investment]."

The simplicity of a single storefront appealed to Sesto, the telecom director at Ottawa Regional Hospital.

"It seems like I've got telephone accounts scattered all over the place. At any given time, I'm signing off on a dozen different AT&T bills every month," Sesto said. "I like the idea I'm going to get one bill every month from PosTrack. I sign off the check and it's that easy."

Let us know what you think about the story; email: Jessica Scarpati, News Writer



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