Do attractive margins, new recurring revenue, and stickiness with customers all sound good? Then VoIP may be for you.
MSPs who offer VoIP say it can generate margins from 20% to 70% and a steady source of revenue—for a service that requires little effort to manage. The offering tightens bonds with customers, who’d rather deal with a single source of IT services. And the more services an MSP delivers, the harder it gets for customers to leave them.
“Providing VoIP as part of our managed services stack adds significant value for our clients,” says Paul Nebb, president and CEO of Titan Technologies, an MSP in Freehold, New Jersey.
Having a single vendor manage client infrastructure “minimizes the finger-pointing between providers when things go wrong,” Nebb says. “Because VoIP is heavily integrated with the network, managing it in-house allows us to ensure optimal performance and uptime for our clients.”
Lucrative Opportunity
For MSPs, the obvious attraction of VoIP is the opportunity for recurring revenue with minimal labor costs or overhead. “It’s mostly set and forget,” says Raffi Jamgotchian, founder and CEO of Triada Networks, an MSP in Wyckoff, New Jersey.
If you set up the infrastructure properly to handle VoIP, it’s a highly reliable recurring revenue source, Nebb says. “As long as your network design and configuration are robust, ongoing support demands remain manageable. Most of the client requests we see relate to administrative tasks such as adding new employees or making seasonal call routing adjustments, rather than complex technical issues.”
As referral agents for VoIP vendors, MSPs can make margins of 20% to 25%, Jamgotchian says. “However, as a white label provider we are able to enjoy 40% to 65% margins.”
Triada offers both white-label (you sell under your brand, determine pricing, and provide basic support) and gray-label (you sell under your brand but the provider manages the service) options. White labeling is worth it if you have enough volume, he says. “I typically recommend that if you are billing more than $1,500 per month in telecom, it’s worth considering white label.”
White-labeling, Nebb says, lets the MSP control pricing and branding and deliver a seamless experience. However, he warns, it’s important customers understand you aren’t a telecom carrier. “In some cases, it’s necessary to engage with the carrier directly to troubleshoot unusual or complex issues.”
Daniel Curry, founder and owner of Indy’s IT Department, based in Indianapolis, has considered white labeling but chose the agent option. It makes things simpler, he says. “I subscribe customers to [the VoIP provider], who handles all the support, taxes, direct billing, etc.”
Jamgotchian outsources taxing for his white-label service to a company that handles Triada’s compliance obligations. “For our gray-label clients, it’s the voice company that does it but they charge what we specify and collect on our behalf.”
Nebb also uses a compliance firm. “This allows us to stay compliant with all relevant regulations while ensuring our clients aren’t exposed to any potential liabilities.”
Choosing a Provider
Choosing the right VoIP vendor is key. You want reliable technology, vendor transparency about issues and outages, and dependable support to handle technical problems and QoS concerns, says Jamgotchian.
Nebb stresses the importance of high uptime and responsiveness to support requests. Titan’s in-house helpdesk handles first and second-level VoIP support, which ensures clients get timely assistance, he says. But the team escalates the more complex issues to its VoIP vendor for advanced troubleshooting.
Responsiveness is essential. “Clients become frustrated quickly with poor call quality or service outages, so it’s essential to partner with a provider that can deliver consistently,” Nebb says.
For Curry, a VoIP provider that handles everything, from technical support to taxes, makes the most sense. “I look for a provider who takes that off my shoulders, so I can continue to concentrate on the tech.”
Whether you choose a white-label, gray-label, or agent model, VoIP is a service to consider if you’re looking to boost your RMM.
