Superloop and Exetel: Accelerating cloud adoption in the Australian SMB space

With our acquisition of Exetel now formally completed, we're well on track to migrate Exetel's customers onto the Superloop network and enable both Superloop and Exetel products to be carried across Superloop's infrastructure.

(As I write this, the first connections are now running over the Superloop network.)

Behind this acquisition is the belief that SMBs are inherently important, that this segment deserves to be supported, that SMBs are entrepreneurial adopters of technology, and that they are the commercial lifeblood of the country.

With this acquisition, we believe we can help SMBs accelerate their growth by bringing new focus and products across our network. SMBs represent the heartland of the growth engine of Australia - a component of the market that the larger providers have taken for granted, or neglected, for too long.

Australia's SMBs want "digital today", not "digital, maybe"

Delivering on the expectation of “digital today” starts with the idea that businesses fundamentally don't need to host and control infrastructure. Whatever they need is already available out of the cloud. This includes high speed connectivity and service, and adoption of products that either sit on the cloud or enable them to reach the cloud and operate within that environment.

The potential to accelerate this into the market is especially important in the Australian context.

Australian SMBs, alongside their larger enterprise peers and competitors, are taking up and adopting high-speed internet services in ever-increasing numbers because these services provide them with access to the cloud.

Gartner's recent figures for the uptake of cloud services in Australia and worldwide are impressive. Australian businesses of all sizes will invest around $10.6 billion in public cloud services this year, up 18.4%.

There are several factors behind this adoption that, I think, separate into two broad categories: the cloud services themselves, and the access to those services, aka the network infrastructure.

Sitting alongside both are the quality of services, including the ease and speed of network access.

Historically, Australian SMBs have had it tough. Businesses have had to spend perhaps up to $2 million per year on connectivity infrastructure costs to attract any meaningful attention from the telco industry incumbents.

That has tended to exclude SMBs, who simply don't make that investment.

This is where companies like Superloop and Exetel come in.

Where this acquisition plays in the Australian market

We're obviously excited by the Exetel acquisition because it drives utilisation of the Superloop network and helps us achieve financial synergies.

It's better-still for Exetel's customers, who now have access to an incredible, modern, high-speed and automated network coupled with the great service from Exetel that they are accustomed to.

Perhaps the best result, though, is for the market as a whole, because, in the near future, we will start to roll out a combination of competitive products and services across Superloop's high-speed network.

Now, with this acquisition, investments we make today are shared across a larger pool of customers and businesses. They present new connectivity options to the market as a whole that are built on investments in technology, automation, systems and product development.

This will be of particular interest to Australian SMBs. Already known as a strong consumer brand, Exetel in fact also has a loyal, valued and growing base of business customers, contributing to more than half of Exetel's profitability. Today, over 12,000 business customers benefit from Exetel's commitment to business over more than 10 years.

And the two companies' business models complement each other well. Superloop's heritage is the creation and building of next-generation data and internet networking. Exetel's is building innovative and great value product suites across voice, mobile, data, and security aimed towards businesses in Australia.

Bringing these two together creates a new offer to Australian SMBs that has, in many respects, been missing until now. Unified collaboration, voice over IP and data service will soon be carried across the Superloop network, creating new performance benchmarks to a broader range of service options.

I think there's a really nice energy and synergy in this. It's exciting for the teams involved and I think will be of real interest to the market.

New options, new opportunities

The fundamental consequence of the completion of the NBN, and its continuing upgrades around Australia, is the reality of new options. Businesses can gain leverage from the new breed of high-speed, digital-first networks that now exist.  

As a result, the market is ripe for what I call productive disruption - wholesale changes in favour of businesses, by bringing together all of the elements required to do so around speed, resilience, newness and digital-first, at a price that remains attractive.

For small and medium businesses, they are going to see new options for high-speed connectivity with services as fast as 10 gigabits per second, available across metropolitan and regional Australia.

Small and medium businesses will also start to see improvements around the quality of customer service and support.

SMBs are, by definition, spending less with their existing telcos, so they experience the frustrations and pain that comes with being “too small” for their attention. Their leverage is smaller when compared with these larger companies, but their service needs around network resilience and capacity, for example, are as pivotal and as important as those of larger companies.

Having modern, digital, integrated service and support systems will, I suspect, be a breath of fresh air to many SMBs in Australia.

As for us, we'll continue to be the challenger, built on our infrastructure base, its simplicity of access, and the standardisation of systems.