Susie Stone thrives in smaller telcos where the entrepreneurial climate allows her to just get things done. The Vocus Communications GM tells Rob O’Neill about the battles and the camaraderie
Getting work done and serving customers well is now a lot easier than when Susie Stone first joined the telecoms industry 20 years ago.
Which is fortunate because being general manager for business, government and wholesale at big challenger brand Vocus certainly gives Stone a lot to do. Prominent among her tasks has been merging operations when Vocus acquired Auckland telco CallPlus, as well as managing the company’s move on to the Telecommunications as a Service (TaaS) panel of telecoms service providers to the government.
Stone talks about what it is like working for challenger telcos. It was while working on local access and fibre roll-outs at Clear Communications in the late 1990s that Stone received her first industry battle scars.
“My area was deploying the local fibre and deciding what we would put on it. Then that grew into a broader products’ role, and then Clear got sold,” Stone offers as a potted work biography.
The scars came from ongoing skirmishes with Telecom as the latter fought to maintain its inherited monopoly position.
“Those were the old days when number porting was still being negotiated between the carriers,” she says. “Telecom believed it owned the entire New Zealand number range.”
Stone and her team would try to get local numbers for Clear’s business customers and Telecom would refuse to allocate contiguous number ranges.
“You might get 926 here and then you might get 938 over there, so you couldn't provide a great customer experience. It would be little things like that they would do – and pricing of course.”
When Clear went after a big client it would also often find that its target customer could get better pricing at a corporate level than Clear received at wholesale.
Stone likes complexity though. She came to the telco world out of the Ministry of Commerce, where she worked on an array of regulatory issues, from radio spectrum policy to lawsuits over the promotion of the Māori language.
Much has changed for the better over the last two decades, she says, but issues of market dominance still regularly emerge. However, this is not peculiar to the telecommunications industry.
“I think there is a particular range of industries affected, where you have network economic effects – often large barriers to entry, if you’re talking about infrastructure investment,” she says.
Right now, the latest round of regulatory telecoms market interventions, in the form of the Telecommunications (New Regulatory Framework) Amendment Bill, is being brewed up in Wellington. Stone was tapped, in the absence of Vocus’ regulatory and commercial manager Graham Walmsley, to present Vocus’ oral evidence.
“Telco is a land of commodity products and fast-moving technology changes. So, it's how you manage the customer relationship... and the quality of the service that you give, that matters”
Top of the company’s wish list are changes to – or, indeed, the removal of – provisions easing restrictions on the lines of business that network operator Chorus can undertake, and changes to regulate only one entry-level anchor fibre product.
“I think that it’s completely erroneous to suggest that these are minor and inconsequential changes,” Stone says of the lines of business changes.
Vocus’ submission describes the combination of the two provisions as a “toxic cocktail” for existing retail competitors.
Another priority is building Vocus’ product and service capability for the TaaS panel, which it joined in January.
Getting on to the panel was especially welcome because FX Networks, which Vocus acquired for $116 million in 2014, boasted quite a strong government business. Vocus needed to get on the panel to secure this again.
Stone doesn’t agree with recent calls by local industry lobby NZRise to end all-of-government procurement by panel, which, it argues, disadvantages Kiwi companies.
Stone says she doesn’t quite understand NZRise’s particular beef, because she doesn’t see why providers can’t go and get themselves on to panels. That’s what gives them the “right to play,” she says.
Up until its 2016 merger with M2 Communications, Vocus didn’t bid to go on the TaaS panel because it didn’t have the necessary capability, she explains.
“So, I guess, I don’t see the panel structure per se as being a limitation.”
Far from it, in fact. Once the Vocus TaaS offering is bedded down, Stone says, the capabilities developed will be taken out to the business market.
While mergers, regulation and industry structures are always important, and sometimes entertaining, it is business as usual that is the key to success – the day in, day out of sales and customer service.
Stone says it is this engagement, and the service delivered afterwards, that differentiates Vocus.
“Telco is a land of commodity products and fast-moving technology changes. So, it’s how you manage the customer relationship; how you understand the business and the quality of the service that you give, that matters.
“It's not just the sales side. It’s if something does go wrong, how you respond to that.”
Right now, Stone is seeing a lot of interest from customers around voice, as well as much interest around IP telephony capability, hosted voice services and the cloud.
“There’s lots of talk about how they can take stuff that they have sitting in their offices and move it to the cloud.”
For Vocus, the ability to be flexible is key, and that is, in part, a product of having the right scale to deliver network reach and competitiveness, but not so much scale that the customer is going to get “lost inside the business”.
And, again, the FX Networks buy-out was a “fundamental differentiator” here. It gives speed and responsiveness for customers.
“If a customer wants a reasonably large amount of capacity to be turned on quickly, between two data centres in two cities, I can do that really fast,” says Stone.
“Having your own infrastructure gives you that ability, and you can differentiate the products you offer depending on the capability of the equipment you put at the end of the fibre.”
Infrastructure also provides for better economies of scale, allowing Vocus to light large chunks of fibre it would not necessarily buy on the wholesale market.
A weak point for Vocus is mobile. It delivers this service as a mobile virtual network operator, or MVNO. Once again, regulatory grit in the market machine is the issue.
“If you have a look at our submissions, we’d quite clearly like to see changes, to make it more cost effective for us and to give us the ability to really innovate in terms of what we offer,” she says.
“We’d like to see the pricing structure changed fundamentally, and I think the structure of how the products are delivered to us changed too, so we’re able to control how we put products together, rather than being limited by a defined product set that comes to us.”
As for NZ Inc, the availability of ubiquitous fibre is a game changer, says Stone.
“We only have to look at what’s going on in Australia to see the contrast.”
Having a core infrastructure in place gives companies the ability to innovate on top of the network.
Before fibre, the wholesale business basically saw the traditional carriers swapping minutes and traffic between each other, or selling inter-city backhaul.
“Because we’ve now got this ubiquitous fibre platform, we sell a service called ‘Telco in a Box,’ where we take brands to market that have absolutely no telco experience at all, but want to add a telco service to the other products and services that they offer.
“You can do that now because you’ve got this fibre infrastructure laid out to homes and businesses.”
A career with challenger telcos holds no regrets for Stone who relishes change and start-up style thinking, and the ability to get things done. There’s been no long-term career planning – just a search for interesting work and colleagues she likes to work with.
“Challengers are often more interesting to work in because it’s more about camaraderie and getting stuck in and getting things done,” she says. “You’re not worried about protecting old legacy revenues and things like that.”