By Robert Bell

Pier du Plessis is South African by birth and a turnaround artist by trade. With a background in sales, marketing, finance and accountancy, he worked for several companies in South Africa, helping distressed operations to return to growth, before taking a job as regional sales director for a satellite services company in the Netherlands called Carrier to Carrier Telecom NV.

“You could argue that things went too well,” he said of that period in his life. “I was next invited to move to Biddinghuizen in the Netherlands to become Global Sales Director. That was at the height of the dot com and telecom bubble. When I got there, everything started collapsing. You could say that my turnaround experience came in handy.”

Carrier to Carrier was founded in 1999 by two entrepreneurs, Steven Bessem and Chris van Beusekom, who saw an opportunity to provide voice and data services to the developing world via satellite. It is a challenging market in which many independent service providers have come and gone, yet Carrier to Carrier has survived and even prospered. Today, it is owned by Blue Fox Enterprises, a provider of CAD/CAM/ERP solutions to the international textile and apparel industry and CAD/GIS services for government institutions. Carrier to Carrier operates a sizeable teleport about 75 kilometers from Amsterdam that accesses Panamsat, Intelsat and NewSkies Satellites (among others), a carrier-grade voice switch, and redundant fiber connectivity to Amsterdam’s Data House.

Specializing in Volatile Markets

So what made it possible for Carrier to Carrier to succeed in volatile markets in Africa, the Middle East and Southeast Asia? Selection of customers has been crucial.

“The markets we serve are predominantly enterprise, government and military for voice, IP and intelligent data networks,” said du Plessis. “When I first got here, we were accessing most of this business through integrators. During the telecom meltdown, the integrators started failing one after another, so we had to develop direct relationships with existing customers and leverage these to find new applications and new customers. It worked because we have a track record. We are solvent. We are UN-security approved. And we have always focused on quality of service rather than trying to win on price. That’s a good fit for these big anchor tenants, because our networks support mission-critical applications.”

If anchor tenants provide stability, it takes emerging-market entrepreneurs building new businesses to generate growth. “We have established a network of local resellers and integrators to deal with smaller customers,” du Plessis said. “The local resellers fight the battle in terms of negotiating the deal and collecting the money. We’re very strict with them and their customers. When a new customer comes in, he inevitably wants to be on a satellite that nobody is on. If we have to go on a new satellite, it must be a premium spacecraft where there is a customer neighbourhood or we see a strong opportunity to build one. No inclined orbit or end-of-life birds. Once you’re cheap, you’re cheap forever. And we won’t hesitate to switch off a customer with payment problems. The service we provide is their primary source of income and they need to respect that.”

Pier credited his South African experience for teaching him where to be firm with customers and where to be flexible. “We design networks to meet the customer’s real needs,” he said. “We don’t over-engineer things. We don’t mind if customers prefer to own their own equipment. The key to success in these markets is to react quickly and really understand what they want. Most of the time, it’s to make a phone call. If you’re going to deploy voice over IP, it has to be designed well. VOIP developed a very bad reputation in emerging markets, because it couldn’t handle the millions of minutes that customers wanted to pump through it. It gets complicated and bandwidth-intensive. The solution has to be crafted to the customer’s real need. That’s why we offer tailor-made solutions. Our in-house customers, in turn, offer iDirect, DVB solutions, Dama systems, ND Satcom, you name it.”

Opportunities Ahead

Having survived so many challenges, what does du Plessis expect in the future? “Opportunity,” he said. “All of the big players are reorganizing or changing ownership, and that’s going to distract them for some time to come. This should create new opportunities for us. On the other hand, there’s probably another major shake-out coming due to price erosion. Well, that’s OK. We’ve been through two of these already, and feel that our value proposition will see us through the next one, because the anchor tenants are prepared to pay for the value they receive, and we’re a lot more nimble in the local markets than our bigger competitors.”

For du Plessis, the biggest risk facing Carrier to Carrier is internal. “Our challenge is to avoid becoming too traditional. We were cheeky when we started and we have to fight to say cheeky. We have to keep the soul of innovation alive and well. If we fail there, that will truly be the beginning of the end.”

This is one of a series of articles exploring how the teleport sector is adapting to a fast-changing satellite communications marketplace. Robert Bell serves as the Executive Director of the World Teleport Association and invites your comments at [email protected].