Jola Cloud Solutions' Blog

Addresses PSTN replacement need

There are millions of single-call PSTN lines in the UK that are soon to be end-of-life. Upgrading to broadband is expensive and capital costs of converters and 4G routers soon mount up.

Jola has solved this problem for resellers and their customers by providing everything they need, on one affordable monthly rental.

“We have recently added a wide range of Analogue Telephone Adapters to our PSTN Replacement Toolkit ranging from single to 48 port solutions. We also have routers with in-built ATAs as a ‘one box’ solution for those customers that only need a single line. Jola Partners manage each port on their ATAs using our portal. The credentials of their SIP overlay services are auto-configured on the devices. End-users can retain their existing analogue phones and port their numbers, which is great for customers such as hotels and care homes, who don’t want to replace their handsets. Jola ATAs complement our existing portfolio with customers able to plug the ATA into an intelligent 4G router and use Jola mobile connectivity to deliver the SIP service. The Device as a Service model is becoming increasingly popular because there are no up-front costs and the device is guaranteed for the duration of the contract” Lee Broxson, CSO, Jola.

Following the acquisition by Wireless Logic, Jola is strengthening its Channel presence with the appointment of Jon Chard as Partner Director.  Jon brings a wealth of Channel knowledge and is a fantastic asset to the Jola Sales Team. 

'‘I’m delighted to have joined the Jola Team, a business that I have held in high regard for several years. Jola is an innovative and forward-thinking business in the channel, and I am looking forward to helping them push towards further growth and continued success.’ Jon commented.

Lee Broxson, Jola CSO added, ‘It’s a pleasure to have Jon joining the team as a Partner Director, he brings with him 17 years of telecoms experience with five of those spent working with Jola at one of our suppliers.  Jon will be managing our larger MSP and ISP partners with a strategic goal to help find and win larger deals within their bases using our unique Mobile-Data Revenue Generator™  (MRG™) process.’

Chard’s appointment enhances the continued expansion of Jola with Oliver Izard, a former sandwich year placement, re-joining Jola as an Internal Account Executive.

Jola was setup such that we would be ready to transact at any time. We didn’t know the exact date and we didn’t want management distracted from growing the business. So;

1. We operate a 3-year rolling financial plan, re-forecast quarterly for cash flow purposes. The first 12-months is the budget, which is fixed in April, followed by a 24-month outlook. There is a new draft 12+24 every January, finally signed off in March to start in April. In my experience operating only a 12-month budget and writing a business plan just when you need an IM is a mistake. We re-define and hone our strategy every year but this tends to be more about emphasis than direction. Our fundamental strategy has not changed since 2016 when we pivoted the company into mobile data. Our overall approach makes the production of an Information Memorandum much more straightforward.
2. We are paperless. This is really important for Due Diligence. All our IP is documented, and we had all our contracts and service agreements completed and checked by lawyers in the first year. We resist non-standard agreements, even down to insisting on our own NDA. If we have to amend our terms it is recorded and done via an addendum, A buyer’s lawyer is going to have to read everything in DD and very often the seller pays for this, so by minimising exceptions we cut out a lot of time and cost. We opened our data room the day we started Jola with £50k in 2014.
3. We made ourselves known to the market and started building relationships with PE very early. We focussed on specialist TMT Private Equity because they ‘get’ technology, won’t wince at the multiples and will help with origination of deal flow for a buy-and-build strategy. We talked to credible analysts like Megabuyte and were very open with them about our numbers and strategy. Some PE firms won’t do minority investments and some won’t do secondary-only so I found it saved time to be upfront about our intentions when approached by PE firms. Receiving offers from PE and growth funds is very affirming for both the strength/depth of management and the general and financial health and strategy of the business. However if you are immature in these respects but still want to raise money you could consider a syndicate (sometimes called deal-by-deal) arrangement. This only really works for a minority stake and you will still need an IM, but the due diligence, process is much lighter and shorter.
4. They say good advice is cheap but there is some very expensive bad advice out there too. For TMT Corporate Finance advice and deal assistance there are only a few in the UK I would recommend. My last deal was 2012 so to bring myself up to date I asked people I trust and respect about their recent experiences. This was invaluable. Above all we made sure we had the best CFO we could afford. We only needed someone part time when we weren’t transacting and we found the best CFOs were often plural anyway. Supported by Pinsent Masons, our CFO and I did all the heavy lifting on all deals, shielding the management team as best we could. We short-listed corporate lawyers for their track record and it was a bonus if they had worked for some of the buyers on our shortlist and knew their redlines and ‘gives’ on the SPA. Three legal firms bid for the work.
5. Most processes take around six months and we knew it was important not to lose focus and miss our numbers in that period. We didn’t want to make our investor nervous or give them a reason to try and chip us on the agreed price.
   

Vendor partnerships are much more effective than simple supplier-customer relationships, especially when considering new products or new markets. If your vendor is ‘sell-through’ rather than ‘sell-to’ they will have a lot of experience of what works in different verticals and they will be able to talk in detail to their case studies. Probably more importantly they will know the pitfalls to avoid, and they can help your conversion by steering you away from bids you are unlikely to win.

Of course this only works if you trust them, which means they have to be channel-only and be able to point to a track record of selling exclusively through resellers. Some of your bigger customers will be tempted to try and go direct once they learn the identity of your vendor-partner. You must feel confident that they will not only close this conversation down but do it in a positive way that does not jeopardise the deal or your overall relationship with your customer. 

Jola’s experience of the mobile data market is that most end user customers have an application for IoT/M2M. They either don’t realise it or they don’t consider the MSP/Reseller able to fulfil their needs in this area. Against this they would much rather buy from existing suppliers, particularly where they need help in defining the project and possible solutions. 

Jola has productised the process of engaging with customers on mobile data and called it the Mobile-data Revenue Generator (MRG). This unique process defines the way we work together and qualifies opportunities, capabilities and skills. We help our partners to fill gaps in their capabilities and ultimately win large, high margin, long-term contracts.

We have been selling mobile data to the channel since 2014 and we understand the pain points of our partners and the needs of their end-users in each vertical market. Over time we have developed a unique portal, that gives you the control and visibility you need to manage global SIM estates. Control you can even extend to your customers. We have also developed unique hardware solutions that save our partners time, helping them create a great customer experience, maximise their margin and minimise costs for their customers.

It is very common for the channel to use APIs for both availability checking and for provisioning tasks such as setting up new services.  With fixed line broadband and leased line services then availability checking is usually a key first step for a reseller to collect a lead.  So, they may have a postcode checker box on their website that collects some information about the customer’s location before using an API to provide a list of services that are available all without any human intervention required on the part of the reseller.

I don’t think it’s an accident that Jola’s largest resellers transact almost exclusively using APIs.  Whilst we have arguably the most feature rich mobile connectivity management portal in the form of Mobile Manager, for many resellers they want to pull all that functionality into their own portals.  We decided right in the beginning that anything we develop into our portals should also be available via an API and that strategy has paid off.  Resellers can now perform the full lifecycle management of a mobile SIM card via an API including the initial provisioning, the in-life management and usage monitoring through to changing the tariff on a SIM card or even cancelling it at the end of it’s useful life.

If a reseller makes the move to using APIs then I think it’s important to think about consistency.  So decide which workflows you’re going to automate via APIs and ideally always use that workflow rather than sometimes using the API and sometimes using a GUI.  The reason is that it’s likely that your API workflow will be keeping data in sync between your internal systems and your suppliers’ systems.  So, if you don’t use that workflow consistently you can end up with a situation where your internal systems are out of sync that can lead to billing issues or confusion when it comes to providing support for that service.

I think API usage will be become even more widespread.  The massive adoption of the hyperscale clouds such as Amazon Web Services and Microsoft Azure is providing really powerful, easy to use and well documented API gateways that simplify the process of interacting with all kinds of different APIs.

Open APIs are in their infancy and I don’t think there’s a great example of their adoption within the channel today.  However the promise is clearly exciting and potentially could lead to the channel add a new layer of stickiness to some otherwise commoditised services.  For example, your mobile phone SIM card could have a set of open APIs that gave access to things like SMS history, call logs, data usage information.  Then an App developer could use those APIs to provide really in depth management capabilities into an easy to use App available from the App store.  Now, if your SIM supported those Open APIs but your competitor didn’t and your user valued the capabilities delivered by that third-party App then it’s unlikely they’d switch SIM provider to somebody that doesn’t have that capability.

Your customers are working on mobile data projects right now and demand is predicted to increase dramatically over the next few years. If you get it right with M2M and IoT, you will quickly generate high-margin recurring revenue and, due to higher EBITDA multiples, increase the value of your company.

According to McKinsey, revenues from mobile data are set to increase dramatically over the next five years. Factors driving growth are the availability, speed and reliability of 4G, 5G and IoT. Statista says the number of IoT devices worldwide is forecast to grow to more than 25.4 billion IoT devices in 2030. Fortune Business Insights predict this market will be worth £1085 billion by 2027.

People think IoT is very low revenue and you’ve got to win hundreds of thousands. You don’t. You can often get a decent ARPU of £10 to £15 on thousands of devices and sometimes margins in excess of 40%, so it’s a really attractive line-of-business to pivot into.

Your mobile data partner will need to give you the tools to win deals, usually competing with the direct sales arms of the mobile networks. Your supplier will need to be an aggregator with access to all the networks and ideally, they will also be an independent MVNO. Most importantly everything must be automated, with real-time APIs offering zero-touch provisioning and management through a single self-service portal.

They will need to be innovative, with a constant stream of relevant mobile data and IoT products
that the networks would take years to develop and launch. When you partner with the right channel supplier, mobile data is easy to sell, support and bill.

The opportunity for the channel is significant. We may not find ourselves supplying car manufacturers with SIMs for self-driving cars, but ICT resellers already have strong relationships with business customers for IT infrastructure, asset tracking, digital signage, mobile WiFi, monitoring and utilities.

Mobile data is an easy product to sell and provision and needs very little support. Jola took on just over 200 new partners in 2021 and now have over 1200. We recently put 30,000 multinetwork SIMs into iPads for one public sector project, with a very quick book-to-bill timeframe and no issues.

Scale

Our partner didn’t have to add any more people in billing or accounts to support it. SIMs provision immediately using our Mobile Manager platform, so you don’t have to wait three months to start generating recurring margins. As soon as customers put that SIM into their device, you’re billing for it.  

Getting Started

Speak to your existing customers, understand their requirements, and then partner with an aggregator that can provide innovative solutions, unavailable elsewhere. Find out about their current projects and challenges. Once you have established your customers’ requirements, start building your solution. 

The MRG

Jola has developed The Mobile-data Revenue Generator. It is a six-step process to uncover mobile data opportunities. The process defines the way we work with partners and qualifies opportunities, capabilities and skills. We help our partners to focus on key opportunities and ultimately win large, high-margin, long-term contracts.

Selecting the right suppliers

Who will you partner with for the devices, and where are you going to get the connectivity from? What challenges do you need to overcome? Who has the most cost-effective mobile data solution to meet the requirements? Who is agile enough to develop solutions to meet the time frames? Can you manage the data usage across the estate? Can you control usage and costs, maximise your margin and protect your customer from bill shock?

High Demand

Demand for reliable mobile data to track the location of lorries, buses, coaches, taxis, delivery vans and hire cars is growing, as is the tracking of assets. Smart transport networks offer significant benefits to passengers, operators and local authorities, enabling urban services to become more efficient, effective and safe. Customers want to be able to track the progress of their deliveries and car hire companies need to track the location of their vehicles, as well as monitor the safety of the drivers.

Solutions

There are many end-to-end solutions available to the transport industry, involving 4G routers and cameras. Trams, buses and trains are tracked, and arrival times are accurately estimated and advertised, factoring in potential delays. These devices need 4G data SIMs, often with a fixed IP or delivered via a secure Private APN.

Suppliers

MSPs and resellers need a wholesale supplier with a wide range of connectivity options from single to multi-network to Fixed IP to meet the evolving needs of the sector. Many MSPs have strong relationships in this sector and understand the challenges faced and the solutions required. End-users need continuous connectivity and control over their data usage to avoid data overage charges. Jola’s MSPs can manage global SIM estates in Mobile Manager providing end-users with real-time data usage, alerts bolt-ons and data pools to monitor usage and avoid bill shock.

Challenges and solutions

Without the involvement of an intelligent aggregator, Service providers face a few challenges with 4G. Firstly, some networks are stronger than others in specific locations requiring relationships with multiple network providers. Secondly, they have no way of tracking data usage and if devices use more than their allocated monthly allowance, they get high data overage charges. Thirdly, they need a secure channel for transmitting financial data. Cost-effective multi-network SIMs are available along with an online ordering and management portal, which tracks data usage and allows resellers to set up usage alerts, and back-date bolt-ons. Data pools, allow data to be shared across multiple SIMs and buffer pools negate high data overage charges completely. Private APN networks offer increased levels of security, allowing encrypted data to travel across a private mobile network.

A few years ago IoT was driving transformational change in certain market sectors such as utilities and transport.  The return on investment was so rapid that if you didn’t invest in IoT you were vulnerable to competitors who were already benefiting from efficiencies being gained from their investment in IoT.  Today you would struggle to find a water supplier that isn’t monitoring their distribution networks in real-time or a transport company that isn’t tracking and monitoring their fleet in real-time.  In fact, in these industries, they’re probably on their second or third generation of solutions.  

Today every market sector has a problem that can be solved by IoT.  A few years ago companies would seek out an IoT specialist or perhaps the IoT division of a mobile operator for help.  Today, IoT is mainstream and companies are turning to their trusted IT service provider or telecoms service provider for advice.

IoT sits adjacent to so many other services that resellers may find it relatively easy to fill gaps in their portfolio.  For example, somebody that is already selling traditional mobile could find adding IoT connectivity a natural extension and if you’ve already got businesses that trust you to supply, support and bill their mobile handset SIMs then you’re halfway there.  You may be providing public cloud consultancy or services.  Over 80% of IoT projects are built using one or more services in the public cloud and so there’s a great opportunity to develop an IoT business using tools and technologies that you already know.

IoT opportunities don’t just come because you add an IoT product or service to your portfolio.  You already have customers with huge IoT opportunities but you just don’t know it yet.  At Jola, we have a process called the Mobile-Data Revenue Generator™ (The MRG™) that helps resellers identify opportunities in their existing base and helps develop the necessary products, services and skills to be successful in winning those opportunities.

3G Sunsetting 

The sunsetting of 3G and indeed 2G has huge implications for the IoT market.  There are millions of devices out there that only support 3G that need to be replaced.  There are millions of SIMs that only support 3G, even if they’re in devices that are capable of connecting to 4G.  So there in many cases, the starting point should be an audit of your customers' use of IoT and M2M connectivity and devices.  Some major sectors are payment processing terminals, vehicle telemetry/vehicle trackers, remote environmental sensors, digital signage etc.  In many cases, your customers may not be aware of the ticking time bomb within their own organisation.  Of course, for the reseller, this is a huge opportunity not just to solve a problem but to save their customer money.  The reality is that connectivity costs have come down significantly over the past few years so your customers’ 3G solution likely supplied by one of the big four mobile operators will look very expensive based on today’s prices.  Of course, swapping hardware could be expensive but with solutions like the Jola Device as a Service then you may be able to solve their problem without any CAPEX at all whilst delivering better performance and the latest features.

Every IoT solution will involve a variety of vendors from the device manufacturer, connectivity supplier, device management software vendor, application vendor, and cloud or hosting location.  In some cases your customer will be coming to you for just one element of the solution, in others, they’ll be looking for the end-to-end solution.  Many vendors are not geared up to sell via the channel and should be avoided.  Only a truly channel-only specialist will be able to help resellers at every step of the engagement with a new IoT opportunity.  The low-hanging fruit in all IoT opportunities is connectivity.  The reality is that mobile network operators have quite rigid product sets and limited management bandwidth to deal with a lot of opportunities.  Of course, if the opportunity is sizeable then they’d rather win it themselves. 

As BT starts to close down telephone exchanges in favour of a 100% IP network, millions of end users will need to consider how they are going to replace their ISDN and PSTN lines. Many will be considering availability requirements and backup solutions. This presents a considerable opportunity for the channel.

Jola is a wholesale SIP provider offering SIP and PSTN replacement services to the channel. They have developed High Availability SIP Trunks as an alternative to ISDN and PSTN lines, providing partners with a configuration which supports two SIP Gateways in geographically disparate regions. They are connected to one customer endpoint, giving end-users high availability with a built-in fail-over. HA Plus solutions support multiple CPE IP addresses.

Adrian Sunderland, CTO at Jola commented, “Our new High Availability SIP Trunks are a welcome addition to our PSTN Replacement Toolkit, which offers partners everything they need to replace PSTN and ISDN lines however they are being used. HA SIP Trunks support Enterprise Grade solutions for large corporates which require high availability solutions.”

What was the vision when you founded Jola?

We founded Jola with an experienced team and a tried and tested strategy. At Griffin, we built a channel of over 700 resellers, annual revenues of £24 million and a team of around 130 employees. We had so much fun and success that after the company was sold in 2012 it seemed inevitable that we would work together again. Our philosophy at Griffin was that we were ‘selling with our partners’ rather than ‘to them’ and we continued this approach with Jola.  

Automation, billing and healthy margins are a given. Jola’s vision was to put our partners in control and make them more successful. We felt we understood the needs of their customers and developed unique solutions to help resellers address them. Resellers have higher conversion ratios when they choose suppliers they trust to work alongside them on deals. Innovative suppliers provide differentiated products, which give resellers a higher margin potential.

We started out as a channel supplier specialising in internet connectivity and hosted telephony. When the networks started to allow us to sell 4G products we realised that the biggest opportunity for the channel was in mobile data and so we developed Mobile Manager®. Jola became a multi-award-winning, channel-only supplier of business communications, specialising in mobile data SIMs. We built our own global eSIM MVNO, providing innovative IoT and mobile data solutions to MSPs, ISPs, IT Support companies and Telecommunications Resellers.

What does the acquisition signal to the channel market? 

It reinforces the value of mobile data. With 4G+ download speeds of around 300Mb/s available to 90%+ of the population, mobile data is a credible alternative to fixed line, as well as a great 100% SLA, backup story. It is also the only practical solution to replace millions of PSTN lines in the next few years. Only around 20% of resellers sell mobile data but by 2025 every reseller in the UK will have to have it in their portfolio. As is always the case with disruptive technological change, early movers win more market share and ringfence their customers from competitors.

The financial markets value mobile data EBITDA at a higher multiple than fibre and broadband. With self-service, fully automated portals like Mobile Manager®, it is easy to sell, manage and bill.

Every reseller/MSP has at least one significant IoT/M2M opportunity in their existing base of customers, and mobile data aggregators like Jola are helping to find and win them. 

Could you provide some background to the deal and why Wireless Logic?

Wireless Logic is one of the standout successes of the ICT sector and we have long been admirers of Oliver Tucker and his team. It was important to us that Jola remain an independently-run company, focussing as always on the UK channel. 

There is a natural fit between Wireless Logic and Jola, which makes this an exciting acquisition for all involved. Jola will strengthen and focus the group’s routes to market in the UK and beyond, paving the way for further business growth in the years ahead. 

Our 1200+ partners will see no change in the short term and over time they will benefit from a stronger balance sheet, product innovations across the group and more extensive supplier relationships.

Wireless Logic mainly sell direct and Jola has always been exclusively channel-only. Is this an issue?

I have been in channel since it started and my team is channel through and through. Apart from the fact that our partners are contractually and legally ring-fenced, our reputation should be sufficient to answer this question for partners and prospects. 

What are the cross-portfolio benefits of the acquisition and does it provide new areas of business to develop?

Wireless Logic sees Jola as its channel brand. Over time the best solutions and services will be made available to all partners.

More specifically, what will be the channel benefits of the acquisition?

Wireless Logic is a leading global IoT connectivity platform provider that simplifies and automates IoT management for any device, anywhere. With more than 10 million IoT subscriptions active in 165 countries and direct partnerships with 48 mobile networks, the group provides reach into more than 750 networks across the globe and delivers value throughout the IoT connectivity chain. 

Being part of the group our channel partners will continue to benefit from innovative solutions and management portals to help them win lucrative mobile data opportunities and grow their businesses. Wireless Logic has an enterprise value of over £1bn. Resellers and MSPs working with Jola should feel more confident of winning large and valuable deals, even when competing directly with the MNOs. 

And specifically, what new opportunities do you plan to exploit?

Specifically, Wireless Logic has a much broader pure IoT proposition within the group including a wide range of devices and device management capability.

There are already a great many vertical market opportunities in this space where we are helping partners to win. Being owned by Wireless Logic will only improve our partners’ chances of finding and closing large contracts.

Jola SIMs are being used in tablets, routers, CCTV cameras, lifts, cranes, wind turbines, push-to-talk radios, body-worn cameras, monitoring devices, streetlights, ANPR cameras, yachts, digital signs, personal alarms, door entry systems, smart gates, cameras, buses, coaches and trains.

Our internet connectivity and SIP solutions are used by well-known large corporates and SMEs. We help partners to win new business,  increase ARPU in their current base, and reduce churn.