Calix Expands Managed Services Capabilities to SMB and MDU Markets

Calix has been one of the major success stories in the highly competitive technology communications space over the past few years. Although a company few consumers would immediately recognize by name, Calix cloud and software platforms enable Internet Service Providers of all categories and sizes to transform and electrify their businesses.

On a more practical level, Calix’s capabilities and tools enable Business Service Providers (BSPs) to support and promote their subscribers through compelling experiences, which we’ll detail. For BSPs, this translates into creating a stronger, more solid bond with customers through greater customer acquisition, increased loyalty, and long-term revenue potential.

Calix’s strategy of focusing on BSPs, almost maniacally, paid off with business results. Despite tough supply chain issues, the company recently reported record revenue of US$236.2 million in the third quarter of its fiscal 2022. Calix is ​​on track to top its revenue of US$679.4 million. dollars in 2021, an improvement of 25.5% compared to fiscal 2021.

Market opportunities for SMEs and ILMs

Calix on November 16 announced new solutions specifically designed to help BSPs expand their footprint in the SMB (Small and Medium Business) and MDU (Multiple Dwelling Unit) markets.

Building on Calix’s proven appeal in the single-family home market, these new products will leverage use cases that solve real connectivity challenges in small businesses, apartment complexes, duplexes, triplexes , quadplexes and mixed-use properties.

Calix has reason to believe that its managed Wi-Fi strategy, which enjoys strong appeal in the single-family home market, will see significant uptake in the SMB and MDU markets.

There is a healthy demand for ubiquitous Wi-Fi coverage in these markets as well, and the management aspects often have the same issues with single-family homeowners. In other words, most SMB and MDU customers don’t like to deal with the technical complexity of router setup, maintenance, and upgrades.

The SMB and ILM markets are not tiny. The U.S. Small Business Administration reports 32.5 million small businesses—broadly defined as businesses with fewer than 500 employees—operating in 2021, or 99.6% of all businesses. Additionally, it is expected that there will be 126.7 multi-family dwellings by the end of 2022, up from 68.8 million in 2019.

New Wi-Fi systems meet connectivity needs

Calix introduced two new systems, the GigaPro GPR8802x and the GigaSpire BLAST u4g. Both products are explicitly designed to meet the wireless connectivity needs of the SMB and MDU markets.

The GigaPro GPR8802x is a “special purpose” switch designed for use by SMB and MDU clients. At the technical level, it is an Ethernet-based managed switch/ONT (Optical Network Terminal, aka modem) solution that provides seamless WAN integration, facilitating the ability of BSPs to manage it as a single system.

This aspect is critical as it gives BSPs end-to-end visibility and management with Calix Support Cloud and Calix Operations Cloud. With eight configurable Ethernet ports, eight analog voice ports, and automated service provisioning, this switch can quickly open up new markets for BSPs who want to cultivate their value proposition in their local communities.

Calix range of GigaSpire Blast u4 Wi-Fi systems

Calix range of GigaSpire Blast u4 systems | Image credit: Calix

Calix’s managed services appeal gets an adrenaline rush with the GigaSpire BLAST u4g, an integrated GPON (Gigabit Ethernet Passive Optical Network) with residential gateway capability. Calix designed this product with an “aesthetic shelf appeal” that homeowners and renters will find refreshing and cool. The product supports fast Wi-Fi 6 wireless connectivity, making it ideal for apartment or condo dwellers in large properties or buildings.

Benefits for BSPs

From a business perspective, the GigaSpire BLAST u4g can potentially maximize the opportunity for BSPs to attract opportunities in the residential market, as it can provide formidable and highly secure Wi-Fi to MDUs. Most importantly, the product seamlessly integrates with the Calix Revenue Edge platform for reliably transporting the company’s growing list of managed services.

The following examples come to mind and highlight what the business impact could be:

  • BSPs could use these solutions to help provide apartment owners with the ability to provide highly secure monitoring services in their units, for example, smart control of door locks and video surveillance.
  • From an SME perspective, BSP could use these products to provide retailers with the ability to provide guest Internet services with exciting e-commerce and advertising implications.
  • Calix’s ability to provide BSPs with a custom mobile application – not to mention BSP co-branding opportunities with SMB and MDU customers – sets it apart from large institutional Internet providers like Comcast and Spectrum.

These solutions set the stage for Calix to realize its “SmartTown” concept, which would allow BSPs to support continuous and seamless Wi-Fi access in homes, businesses and schools in local communities.

Analyst thoughts

It’s hard to deny the momentum behind Calix’s strategy, which has unfolded over the past few years. Clearly, the tailwinds in the market are favorable to what the company is striving to accomplish in the areas of communications and connectivity.

Interview with Calix CEO and President, Michael Weening

First, consumers are exhausted by the seemingly endless parade of new “alphabet soup” wireless topologies that hit the market every 18 months or so.

Even though new wireless topologies offer substantial speed and latency benefits to consumers in gaming, working from home, video conferencing, and streaming video, many users resist upgrading their wireless routers. thread by themselves to just avoid the hassle.

Wi-Fi 6 and Wi-Fi 6E are rolling out, yet many consumers won’t upgrade if the complexity is inconvenient and the benefits of upgrading aren’t clear and compelling.

Second, Calix realizes that SMB and MDU customers have the same interest in new wireless capabilities as single-family homeowners.

Tenants, in particular, want the speed and latency benefits of faster routers, but don’t want to invest in their own hardware. Additionally, there are significant additional revenue opportunities for landlords who can offer their tenants value-added bundled wireless services that are fast, secure, and easy to manage.

SMB customers increasingly depend on reliable wireless connectivity at the operational and “guest customer” level. Unlike enterprises, SMBs often lack the dedicated IT staff and the necessary resources that a local BSP can provide to manage the small business wireless system and support any value-added services that the BSP might offer.

Marketing Priorities

It cannot be overstated that the broadband market is highly competitive. Calix is ​​acutely aware of this and appears to be taking significant steps to differentiate itself with platforms and solutions that enable BSPs to reduce operational expenses, deliver value-based “sticky” services to their subscribers, and the ability to personalize their offers.

Going forward, Calix should continue to create unique, compelling, and highly detailed sample usage models that BSPs can customize and send to their subscribers.

Creating and delivering new, easy-to-understand marketing content (especially videos), including subscriber testimonials that MDU owners, SMBs and residents can understand, must remain a priority for the marketing team at Calix.

The company’s relative anonymity to consumers hasn’t bothered Calix as he has been candid in his opinion that its success is heavily dependent on the success of its BSPs.

From a business outcome perspective, this has proven to be very effective as Calix happily acts as a behind-the-scenes entity that enables BSPs to build strong and lasting relationships with their subscribers.

In this context, there is little reason to believe that the Calix playbook will not work in the SMB and ILM markets, given the similarity of long-term challenges, needs and desires shared with the market for owners of single-family homes.


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