RingCentral: Cloud VoIP Systems Catching On Fast In Channel

Founded in 2003 and based in San Mateo, Calif., RingCentral has tens of thousands of customers, but only recently launched a formal reseller program, last September. Now, the company has more than 500 channel partners -- about 30 percent of them telecom sales agents and 70 percent IT consultants, MSPs or VARs -- even though its overall indirect channel revenue is still only about 5 percent.

Targeting SMB customers in need of low-cost, easily scaleable phone systems fit for business use, its products are subscription-based hosted VoIP systems with fax functionality, integration with the various smartphone platforms, auto-receptionist, call handling controls and the full clip of features common to most VoIP deployments. The RingCentral Office offering includes a cloud-based PBX that auto-provisions with Cisco and Polycom IP phones, whereas RingCentral Mobile is intended to extend the phone system to mobile devices.

According to RingCentral, the hosted model lets partners offer a scaleable phone system that can be set-up and activated inside of an hour. Partners also enjoy instant online order and activation through RingCentral -- including access to a virtual phone number that can be used immediately -- plus upfront and residual commissions, and services opportunities for set-up, configuration and management of the phone systems.

"A lot of the channel partners onboard like the idea of offering business phone systems to [SMB] without having to go through full-blown, premise-based VoIP," said Bonnie Lam, director of channel sales.

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Pricing for the Office system is listed at between $19.99 and $49.99 a month per user, while pricing for RingCentral Mobile begins at $9.99 a month. Additional virtual extensions, toll-free or local numbers, fax numbers and vanity numbers can be included for additional fees. RingCentral Fax plans start about $7.99 a month.

Most of RingCentral's deals are won in businesses that have a need for fewer than 10 lines, but channel partners have been successful with bigger-sized deals, too, even in the 60-to-100-line bracket, Lam said.

"We're definitely moving upmarket," she said. Overall, channel business is expected to account for as much as 15 percent of RingCentral's revenue by the end of the year, Lam added.

RS&I, a master distributor based in Idaho Falls, Idaho with nine distribution centers and about 2,750 independent retailers in its dealer network, signed on with RingCentral as its channel program was developing.

Wally Gruel, RS&I's senior vice president of sales, said RingCentral is RS&I's fastest-growing new business line.

"It's been a very attractive business for our retailers," he said. "For customers [of this size] it just makes them look a little bit more professional."

Gruel said the average deal size he's seen for RingCentral deployments is between five and six lines.

"Bonnie and her team did a lot of training for my team and our retailers," he added. "It's a profitable product to sell."