CSPs, Midmarket

VARs Embrace 8×8’s Midmarket Cloud, Unified Communications

8x8 Inc., which provides cloud-based unified communications, continues to accelerate its midmarket channel strategy.

Overall, 8x8's fiscal year 2015 revenue grew 26 percent to $162.4 million. A healthy portion of that revenue growth involved resellers and VARs promoting 8x8's cloud services to midmarket customers, according to CEO Vikram ("Vik") Verma.

Credit: LinkedIn Profile
Credit: LinkedIn Profile

“During fiscal 2015, 8x8 made great progress enhancing our cloud communications offerings for the midmarket, solidifying partnerships with industry leading resellers and VARs and rolling out our services to large distributed organizations," Verma said in a prepared statement.

Among the highlights:

  • New monthly recurring revenue (MRR) sold in the fourth quarter of fiscal 2015 to midmarket customers and by channel sales teams increased 35 percent year-over-year, the company said.
  • Service revenue from midmarket customers increased 34 percent year-over-year and now represents 43 percent of total service revenue, compared with 39 percent in the same year ago period, the company added.
  • Monthly business service revenue churn was 0.5 percent, compared with 1.2 percent in the same period last year. The key takeaway: Few customers cancel 8x8's services.

Recent channel partner additions include Arrow Systems Integration, Intelisys and CDW. Moreover, the company has launched an enterprise suite of services featuring Virtual Office telephony and UC; Virtual Office Analytics; a Performance Assured SLA; and “Elite Touch” customer support.

Many smaller VARs and MSPs have been trying to get a foothold in the hosted voice services market. However, most small channel partners lack key regulatory and compliance approvals to host such services on their own. Also acquiring infrastructure for such services can be cost-prohibitive. For those reasons, 8x8 Inc. and some rivals have emerged as preferred partners into the hosted UC market.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.