The interconnection space continues to evolve rapidly as SDN-based technologies make it easier to automate and integrate once laborious network provisioning tasks. Epsilon has long been a global player in this space, and with its Infiny platform the company has been growing its reach across multiple fronts. With us today to talk about the opportunities ahead is CEO Michel Robert, who took over the CEO role in February 2020 after a 12-year stint at Claranet.
TR: What opportunities drew you to your new role at Epsilon?
MR: I had spent a lot of time working with customers and developing a business around cloud adoption, digital transformation, application migration and so on, I thought there was an opportunity for network services to support that in a better way. And currently, I think you’re seeing examples – Epsilon being one – where really focused SDN capabilities, private and public access to clouds, and security can provide an end-to-end service. If you can provide that interconnection fabric in as nimble and as agile a manner as possible it’s quite compelling, because it really supports what’s happening further up the stack. I feel that this market is evolving, but it’s a bit slow and we can speed it up. I think Epsilon has a good pedigree and an opportunity to play a much bigger role in that space.
TR: So what does Epsilon’s business look like today? What are the key pieces?
MR: There are three revenue streams. There is the data business unit, which is the largest. There are three core location facilities, one each in Singapore, in New York and London. And there is a legacy voice business, which is the smallest. Our main focus is the growth of the data business. Today we operate across 260 plus points of presence globally. Infiny is the NaaS platform, which provides data center interconnect as well as access to public clouds and internet exchanges. We both use it internally and for customers, who increasingly self-service provision with it. Unlike some of our competition, we also help arrange for access and/or last mile connectivity to bring connectivity from an enterprise location to one of our datacenter points of presence. We want to grow the role of Infiny as the primary engagement platform for our customers, and recently we acquired 7D Digital that had been working with us on the development of Infiny. We wanted to bring that in-house and get more of their time.
TR: In what ways do you hope to drive Infiny’s evolution?
MR: We have a number of customer types: carrier customers, channel partners, and direct enterprise customers. What we need to do is to make sure that based on the persona of those customers Infiny is relevant in delivering the service through the whole lifecycle. So we’re spending more time to better understand those customer requirements so that it becomes the de facto engagement platform. The platform’s functionality today is doing well, we just want to understand how we can broaden that.
TR: Where do you see opportunities to drive revenue growth in the market ahead?
MR: For our carrier customers, we help them complete a service for their own customers. Some of them, such as smaller or regional carriers, especially in Southeast Asia, are also looking to us to help them with cloud and IX access. We have now created carrier sales teams in Asia and in Europe to focus on those customers because their requirements are slightly different. For channel partners, we see managed service providers who are helping companies with application migration and digital transformation but may not have a network component to that service. We want to work with them to round out those service offerings and provide them a recurring revenue stream. Recently we announced a partnership with Aviatrix where we see opportunities to provide more advanced cloud access services such as multi-cloud. Multi-cloud is not only about access to multiple leading cloud providers, but it’s also about the ability to transfer data between clouds on a private network, which is pretty unique to the market.
TR: Do you foresee other M&A opportunities like the 7D Digital acquisition ahead? How do you view M&A in today’s market?
MR: I think M&A, done well, can be very, very valuable. For us the 7D purchase was really an acquisition of a known entity and actual known individuals within that entity. The team at 7D was also keen to come in and dedicate their time to Infiny, so it was pretty straightforward and a decision was not terribly tricky to come to. For future acquisitions, we have no immediate plans. But the right acquisition can bring customers, enhanced services, or other capabilities that might take too much time or just are not available organically. But technical partnerships, such as ours with Aviatrix, can work quite well too. The right partner can advance your portfolio development and get you into the market. Either way, the target is always one plus one equaling three, not two.
TR: What’s the underlying competency you hope people see shining through at Epsilon?
MR: I think it’s the interconnection message, the ability to stitch together the important elements that help global networking today: access, data center interconnection, the IXs, and access to cloud. We are working hard to bring that all together in an interconnection network-as-a-service offering for carriers as well as channel partners and end customers. That’s what we’re trying to do and what we will be doing.
TR: You took over the CEO role at Epsilon just as COVID-19 started to take over the world. How has the pandemic affected Epsilon itself and your plans for the company?
MR: It was definitely not expected. We are distributed between three operational sites. I’m in the UK, the business is headquartered in Singapore, and our customer operations provisioning and some backup office functions are in Sofia, so we’re ramping up the investment there. I started on February 1 and I was able to get to Singapore for my first week, but then every trip subsequent to that has been canceled. But in terms of the business performance, I’m proud of the team. They’ve done a great job. We’ve made a lot of improvements and changes during a difficult operating environment, and we have been able to maintain our momentum. I think we’re very fortunate that we’re in a relevant space, and the demand for our services remains strong. So we have not been impacted nearly as much as many, many other businesses around the world.
TR: Are there any lessons you think that our industry has learned from this year’s events?
MR: One obvious lesson is that we can actually work fairly effectively from remote locations. I think if there was ever a hesitation about whether we can trust our employees to work remotely, that has now been tested and debunked. That’s not just for Epsilon or the telecommunication space, but for many, many businesses. The pandemic has also reminded people how important network and connectivity is to enable that to happen. Microsoft Teams and Zoom and all these applications which now are fundamental, are cloud services that are running over networks. Without robust networks, access to cloud applications, and all the things we have been developing over the last decade, none of this would have worked. If this had happened 5-10 years ago we would have been in a very, very different place.
TR: What’s the biggest challenge ahead right now for both Epsilon and the industry at large?
MR: While I think that we’ve done pretty well in working remotely, I think the value of getting people together and engaging as a team is really important. Whether it’s internally, with our partners, or with our customers, I think the faster that we can get back to that, the easier it will be to accelerate our ongoing development improvement work. I think all of us are looking forward to a 2021 which has more good news than bad news in it, whether that be on the political front or on the economic front. But first we are within a tough winter in which we will continue to see fallout from the economic impact of the pandemic.
TR: Thank you for talking with Telecom Ramblings!
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