Stephen Warburton, managing director for partners at Zen Internet, opened the company’s 2020 partner event this afternoon with an update on where the company is today, and what its partners can expect in the months and years ahead.
Warburton shared his “philosophy on partnering”, saying that he sees it as Zen’s job to make its partners successful. “It’s as simple as that. If you are successful, then so will we be. How can we do that? By giving you a really high-quality product: a great network that is really well supported by our people, at a competitive price. We want to help you attract new customers and get more business out of your install base.”
Warburton shared an overview of what has happened at Zen over the past year. He said, “We set ourselves a strategic goal just over a year ago to be a challenger to the big players in the market. And for us, that means doing things differently.”
He discussed why the company gained its B Corp Certification back in September, as well as the launch of its Circle of Excellence programme and reaching Zen’s 25th birthday a few months back.
Warburton acknowledged the year has not been without its challenges. “We did have some challenges in the summer, particularly in our provisioning and technical support teams. We struggled to cope with the surging demand we saw in that period. We’ve since recruited a number of additional people into those teams, and we’ve changed processes and systems to alleviate some of the challenges that we’ve had. I am genuinely really sorry for the disruption during that time. We’ve certainly learnt some valuable lessons for the future.”
He then gave an overview of recent launches, including Zen’s new FTTP speed tiers and its SoGEA offering which was launched back in April. This, Warburton pointed out, was “ahead of our planned launch date due to the focus we put on it through Covid”.
Next, Warburton turned his attention to the shift from FTTC to FTTP, and reflected on Zen’s business performance. He said, “We’ve seen a surge in demand for faster speeds, our FTTP sales have more than doubled over the last few months and they now account for about a quarter of sales that we generate each month. The reliance that people now have on their connectivity is significant. And we believe that is going to drive even greater demand for better quality services.
“From a sector perspective, our retail and channel businesses have performed well. Our volumes are up about 30 per cent year-on-year. It’s been a bit more challenging in our enterprise business. We’ve seen spend paused for our corporate customers, although there are signs that is starting to recover now in the last few months – so we’re hoping to see that improve.”
“In terms of the Zen network, we’ve seen a huge increase in usage. We’re nearly 70 per cent up year-on-year in terms of network traffic. We planned for between 25 and 30 per cent growth, so that was a really significant change. The technology teams in Zen have done an absolutely incredible job to cope with that surge and exponential demand. We don’t see this changing going forward. We believe we will continue to see very significant growth in usage, connections, and the move to faster speeds.”
The year ahead
Warburton then outlined Zen’s plans for the future. He explained Zen’s ambition to be viewed as a challenger brand in the market. As such, Warburton explained, the company does not “want to follow everyone else”. He added, “We’re very open-minded to a different way of doing things. We’re very willing to be bold and take some risks.”
Zen wants to be a pioneer in ultrafast. Warburton said that the company sees a tremendous opportunity in the market right now, with the next three to four years set to be dominated by a race between providers to upgrade customers to FTTP.
Warburton added, “It’s an opportunity and it’s a threat to us because, in our experience, we’ve seen a typical customer stay with us for over six years. What we find is that once the service is installed, the fault rate is very low and the performance is fantastic, so there’s very little reason for customers to move.
“It becomes quite difficult to transition between providers, so it’s important to get to customers quickly once the service is available. It’s a tremendous opportunity to go out and win new business and gain market share.”
Investment and opportunity
Zen will be investing heavily in its network to manage this transition. Warburton said that the company will be taking its footprint from 450 exchanges today up to over 700 exchanges over the next few years. In addition, the company will upgrade its backhaul infrastructure to cope with new FTTP speeds.
Warburton closed his keynote with a message of positivity and opportunity for Zen’s partners. He said, “It’s a tremendously exciting time in the industry right now. The next five years are going to be pivotal. We’re going to see millions of customers move from traditional copper broadband services to fibre-to-the-premises, and that’s going to give customers the speeds and the reliability they’ve been craving for many years.
“How often have we heard about speed or reliability being a barrier to a sale? I believe that’s now going to change. Change always creates opportunity. And we’re about to go through a tremendous change in our sector. So I’d urge you all to join us in grasping that opportunity.”