Windham parses Digium

Danny Windham has been CEO at Digium for nearly twenty months and realizes there's still a lot of work to be done at the open source telephony company.  FierceVoIP caught up with Windham at Astricon a few weeks ago to get his latest thoughts on Digium's progress, the marketplace and challenges that lay ahead.

FierceVoIP:  Are you happy with the way Switchvox has gone to market?

Windham:  I think not, we haven't been at it long enough. We have gigantic work to do to reach small to medium-sized businesses. The reaction [to Switchvox] is so encouraging, it makes you want to do channel development even faster. The reason why we're not happy is we haven't been at it long enough.

Is it successful? The projections we made at the time we acquired Switchvox were pretty aggressive. We have met those projections and we're where we hoped to be at this point in time. The core team is still there and the strategy is improving month to month.

FierceVoIP: So where do you go from here?

Windham: There are a lot of investments we've been making. If you look at the first year of investments, they're all product related. There [have been] changes in strategy, the Switchvox acquisition, trying to decide what Digium is going to do. There's so much opportunity across so many customer bases. If we try to do it all, we can't do it very well.  

It's hard to say, but we can't put all the children on the life raft with us.

Now it's about selling, and investing in sales.

FierceVoIP:  How many resellers do you have right now? 

Windham: Our reseller count has doubled in the last six months and is between 378 and 400.  To get access to SMBs, there are millions of them out there, it's just a big job to get a channel to access them.  

[Windham said that he'd like to have about 5 resellers in "lots of geographies," but enabling them to sell and be successful takes a while. VP of Global Marketing Leslie Conway said there was a lot of work to develop sales tools and training and getting in front of resellers to educate them]

FierceVoIP: Fonality sells their product through Dell's website and catalog. Do you see yourself in a mass market channel, like Microsoft's Response Point is down at Costco?

Windham:  Dell is very much a marketing organization, it looks at [the catalog and web] as a way to be a profit center.  If Dell is coming to commit activity to it, there are plenty of people supporting it. It takes a lot of energy to sell through that channel, just like through CDW, TechData.

[As for the mass market/"bigbox" consumer outlets] I don't think we want to try to address that market. It's so different, those channels are massive too.  We won't be going there any time soon. We're selling to a little larger end-user than Respone Point with Switchvox, closer to a 30 end-user installation.

The thing we've heard that what sells Response Point is its really cool voice recognition technology. Most people turn that off after a month. We don't know why, but they do.

FierceVoIP: So what will you be offering to carriers?

Windham: That's one of those children we're not putting in the life raft.

In the short term, we have no plans to create a turn-key solution to sell to carriers... This is not a technology question, this is an availability of resources question. The life raft is not that big.

FierceVoIP: Why hasn't Digium landed a big customer endorsement?

Windham: I don't pretend to understand why. We have larger customers, but there is a reluctance [on their part] to talk about Asterisk.  Some of it is they don't want their competitors to know what they're using for competitive reasons. Or they don't want to reveal network details for security considerations.

There may be some hold over from the image of open source in general. "Open source is for hackers, not for business." I don't know.

We do have installs of around 10,000 end points we can talk about....Integrics builds it, it's carrier class, running on clustered Asterisk. Enswitch is the product.

[There is] the premise that Asterisk doesn't scale.  There are a lot of issues associated with scalability, but Asterisk can scale, the premise that it can't scale is wrong. Or at best, dated.

Could it be better? Of course, but it scales well today.

FierceVoIP:  Any acquisition plans you can talk about?

Windham: Now that we've worked past the Switchvox acquisition, we can consider something else. There's nothing on the radar..[if we do] we would look for things that are very, very unique and specific that we can't go build.

FierceVoIP: You're hiring a lot of talent out of the open source community. Are you worried about taking too many in-house?

Windham: The company is no more than the sum total of its employees. We want the best people out there, the most knowledgeable, to do what we're trying to do, that's been our approach.

Taking developers out of the open community and putting them on other projects could have a downside. However, the group of open source developers is bigger and we're continuing to support them. We're spending more dollars then we ever have.

Take the concept of our two acquisitions. They were both in the last year, and they have worked out very well.  

It is a good thing that [Digium] runs AstriCon. People are more comfortable if we run. But when we run it, we try to put on that third-party hat as tightly as it fits, and try do what is in the best interests of the [Asterisk] open source project. Some small factions could see that and think we have ulterior motives.

The Switchvox acquisition alienated some small portion of the community. They said: One, "We're so glad you did this, but we'd rather sell our own solution;" or Two, "I'm not happy about it, I'm building a solution, I'm going to continue to sell that solution."