Service-based consumption and billing models have been all the rage really since the major hyperscalers came on the scene with cloud about a decade ago, right? Well, now that's extending beyond subscriptions and software into hardware as well. Today, I chat with Greg Labrie, the VP and general manager of WEI Connect, a new offering from WEI, a value-added reseller who's been in the space for quite a bit. And we talk about the evolution both of customer demand for hardware ownership and maintenance, what that means for managed services models for a company like WEI, and we dig into the newest offering, WEI Connect, which brings the capabilities of Starlink into the enterprise business needs that WEI is supporting customers through.
It's a wide-ranging conversation about something that maybe isn't the most appealing topic, but perhaps the most important for everything that businesses want to achieve with their technology. Enjoy the episode and thank you as always for watching. Okay, and Greg joins me now. Thank you so much for taking some time. >> Yeah, thanks Victoria for having me. >> Sure. I guess to kick things off, maybe if you would just introduce both yourself and the organization a bit to our audience. >> Sure.
Uh my name's Greg Labrie and my current role is VP and general manager of WEI Connect here at WEI. We're turning uh Starlink satellite connectivity into a fully managed enterprise service. Since 1987, WEI has been helping enterprise monetize their IT, adding value by listening to customer needs, and WEI Connect is really takes the same approach and it's basically customer needs that have driven us to, you know, create what we've created. >> Sure.
Well, thank you again for taking some time. I know on that topic of customer need and the ways that you've adapted, we were talking a bit in the lead up to this call about something you're noticing in the market in terms of hardware and whether customers are really interested in maintaining and owning hardware in the way that that maybe they would have been a few years ago, a decade ago. So, if you could expand on that a little bit in terms of what you're seeing and how it's changed and evolved over time. >> It is definitely changing as you as you said.
I spent 20 years on the enterprise side, basically the the other side of the table from where I sit now, being a customer. And one of the biggest things in investing in IT was the capital cost of the equipment and installation of that equipment. The CFO was always about we we need to minimize our operational costs and you know, so capital was what they were trying to use to buy things and lower the operational costs. Now it seems like that's kind of the opposite of what's happening.
And more and more people are asking us to make everything an operational cost. So, we're doing hardware as a service when we look at look at it, the plans, they they they don't want to pay for the installation or the hardware out of capital. And there's a few reasons for that. I think cloud services like AWS and Azure have made people think about that. That's how they're consuming that. So, they're looking at that. But it also has to do with who's responsible for that hardware.
Certainly when we and other people are providing hardware as a service, one, you're you're showing that over three or five year period of the cost of the hardware and they don't own it, so they don't have to be concerned about the security updates and and all the firmware updates and everything that happens as well as the if something goes wrong with it, who's maintaining it, what support level is it at. We take care of all of that. If you have it for five years, typically the type of technology we're talking about is easily going to be replaced within five years.
Normally, they would have a big capital expenditure to then repurchase that hardware again, and then new installations. Now, for pretty close to the same price they're paying for that over operationally, they can just now get an upgrade, you know, so they just get the next version going, and if they've allocated $10, $100 a month for that hardware, whatever it is, per month, then it it just continues, and they now get an upgrade and, you know, the newest the newest and latest greatest technology. >> Thank you for that overview, and I think it's interesting to think, too, what that has meant for you as the partner in in how you've adapted to meet that customer demand, right?
What has that shift looked like in terms of how you now need to build your offerings to support customers given that they're thinking more in this operational versus capital mindset. >> Yeah, it's been a challenge WBI being, you know, a value-added reseller, which typical deal would be, you know, you have an IT solution you sell somebody, and maybe there's one, two, three bills that it gets separated into, but that's that's the deal, and and you do that, they they pay the bill, and then maybe 3 years later they need to upgrade it, so you repeat that process.
Um but now you're taking that, if it's a 5-year thing, you're separating into 60 monthly bills. It's a completely different billing. It's something that WBI had to adjust to, more automation around it, because, you know, there's a lot more responsibility there to to do that. So, that was a certainly a shift. >> I'm curious, too, within this conversation. I know I'm certainly hearing a lot more from other resellers, from providers, etc., that customers are thinking more in this outcomes mindset, right?
That to your point, it's not just, "Oh, I'm buying a piece of hardware because we need it to run the business. It's well, what what do I ultimately get out of my technology? How does that help me move my business forward? Do you see that also happening and taking shape with your customers and does that then tie into some of the other ways in which you've evolved the business over time? >> Well, certainly we talk about that a lot because we've talked about that a lot the whole time.
You know, the message that I used to deliver a lot was you want a better experience, right? So experience or outcomes very similar terminology there, but so we would often talk about having a good experience with your wireless, with your win, with at different ITs and IT solutions and what that would mean. So customers definitely are looking for that now, right? So there's a lot of examples of that, but the it's you know, they want to get back to doing what they do as their core business and make sure that the IT equipment's being taken care of the way that it needs to be.
So there's a lot into creating SLAs and what's important to create the outcome that you want and then hold us accountable to deliver that outcome. >> Within both of that, right? Between the SLA, the billing that you've talked about, the ways that these things have just evolved over time, what excites you about customers kind of having this mindset or at least this frame of thinking? Does that open new opportunities for you to have conversations with them or to your point is this maybe just an expansion and evolution of what's always been true and how you manage relationships with customers? >> It's always been true that we try to do it this way and we try to create the the good experience for people, but it always has been a challenge to get people to accept that way because a lot of IT teams are more interested in in building that group in their own environment that would be the experts in taking care of you know, the day-to-day that goes along with taking care of that equipment.
Getting away from that, then that kind of freed them up to do lots of other things. So, I think that started like a snowball rolling downhill. All of a sudden, that started like, "Oh, this is this is helping us do what our core business is better." And in some cases, maybe, you know, somebody does some financial analysis and figures out that it's maybe a little bit more expensive or certainly not a cost savings, but it's a savings in some non-tangible areas like, "What are my people doing every day?
And and is what they're doing towards the goal of what my organization is, or is it in a completely different area that I'm really not an expert in, so I'm missing out on what's the best design, what's the best architecture, and and that sort of thing. Um and by relying on organizations like WI that have these, you know, we have lots of engineers that do design for our customers, so they can show them what other customers have done and how this is put together.
Uh and get a good solution for them. >> I'm always curious too to ask the question that kind of percolates around in my head that we tend to work in cycles in this industry, right? Customers will say they want one thing and go in one direction, and then we'll kind of see something new, and then maybe see a return back to to old form. Do you see this shift towards hardware as a service or or this general service consumption model? Do you see more customers going in that direction, or do you see maybe a potential resurgence in wanting to bring more of that in-house?
I'm just curious how you see that evolution. >> Right right now, the certainly the the um everything's swung over towards doing things as a service, so hardware as a service and um so you know, all everything as a service. Uh you know, and and being very critical about what those SLAs, what those outcomes are going to be, and and writing that up. I mean, some of the contracts that we have now are um like the one for Starlink is 60 pages long because it mostly talks about what the outcomes are going to be, you know, what the SLAs are, and and customers very much care about that uh because now they're not doing it themselves and they can't just tell their employees to change.
It's in a contract, right? So So So those things take a little bit more time, but I think that customers have benefited in the end from it. >> I'll ask two since I have you on the line and we have a couple minutes to chat. Maybe let's dive into that that Starlink business a little bit or at least to WBI Connect a bit more broadly as you said at the top that that you kind of oversee. Walk me through what it is really that you're trying to to address for your customer base and what excites you about the continuing, you know, evolution of of that model. >> You know, what excites us about that model is that WBI is not a Telco, never has been a Telco, uh but we do IT solutions and one of the main IT solutions we do is wide area networks.
SD-WAN has been around for a long time. We call it SD-WAN now, but we've been doing those sorts of things for some time. Clearly one of the things that happened with SD-WAN was to make it such that many different tier internet providers were now available to use as a primary, secondary, or tertiary connection and you could seamlessly move from one to the other or even if you had two good ones, you could split your traffic between them uh depending on what the circuits were or what what kind of connectivity you had.
So if you had a service that was a managed service, you could do some low-bandwidth items on there knowing what the cost would be. And if you had something that was maybe low speed but unlimited, you could send certain traffic that that could handle that over that link. Now with something like Starlink and also cellular, you know, it becomes available to do that for somebody like WBI. So we invested in in SpaceX and and are partner of SpaceX to be able to resell Starlink plans, not really resell what they have and what they sell on their website, but basically create our own plans for customers.
And that includes hardware, includes service model of how much data you might need, whether it's a backup site or a primary site, and put a a package together that that includes the WAN architecture as well. You know, sometimes people are just doing backup, and so we work with them on helping them with either their SD-WAN equipment or maybe it's time for a refresh there as well. Uh so, we can go basically be one shop they can go to for all all of those things.
Uh and we include and can do the managed services of not only the Starlink and the connectivity, but also the SD-WAN product as well. So, basically a fully outsourced WAN, if you will, uh with those services, all of those services, whether it's the SD-WAN product, uh could be a fiber circuit, could be uh from another reseller, Verizon, AT&T, anybody else, but but and also Starlink or cellular directly through WAI Connect. >> When you think about what customers then ultimately unlock in terms of value when you do bring this Connect offering to them, right?
What does that ultimately look like for them? >> Many of them are currently struggling with backup, and that's probably the biggest um item at the at the beginning of this uh WAI Connect is that customers have struggled with backup from either you're using something like a secondary fiber connection, which can be expensive, or you go to something like cellular, uh which is a good cost option, but sometimes is very unpredictable from a bandwidth or latency, or where you are in in the world, uh what can you get for service.
Starlink offers customers a the same similar speeds as a lot of fiber connections, similar latencies, and at the cost of what it would be for cellular 5G. And the the experience is very good for customers as long as you can see the sky, right? As long as you can see the sky, you're you're going to be good throughout at least United States. You get very good signal. It's always the same and it doesn't degrade with weather or or with other things that that happen.
And the one thing that customers notice a lot is that it's also non-terrestrial. So, there's no fiber underground for somebody to cut up or knock a telephone pole down or weather that might you know, a hurricane in in the south that might cause an issue where both the fiber connection and the cellular go down. You know, Starlink's pretty resilient in those kind of situations. >> Well, thank you so much Greg for kind of walking me through that. It's a topic that I don't think always gets talked about a whole lot in favor of some other maybe more trending things on the market right now, but as we wrap here, I'm curious how you see these conversations evolving through the rest of this year.
We're having this talk right at the end of Q3 somehow, right? So, what are you seeing from customers in terms of end of year planning and demand going into next year? >> Well, we see a lot more of coming up of what we just talked about, right? Both things, both the Starlink connectivity for primary and secondary connections you know, for the reasons I just talked about as well as people wanting to incorporate it as a hardware as a service. And and we found that that that was something we had to offer because people's willingness to do that, but also because if you do go with a broadband connection or a fiber connection, typically the Telcos will provide that hardware at really no cost.
You know, not the router or with but you know, whatever the equipment is that brings the connection to you, uh that the DMARC equipment. Uh and that's a little bit different for uh for something like Starlink that there is this extra equipment. So, doing it as a hardware service and building a plan that has the hardware, the installation costs, the the services, the data, all wrapped into one wrapper and one price to the customer is something that they want to see.
And uh that that incorporates both things that we just talked about, really. >> Yeah, absolutely. Well, for those who maybe found this video and and want to learn a little more about you, about the offerings that we discussed today, where would you point them to go? >> Uh you can go to our website at wi.com or you can go to connect.wi.com website that's very specific to the Starlink offering and all of the things we just talked about. >> Perfect.
Well, great. Thank you again so much for taking the time. I really appreciate it getting to meet you and talk a little bit more about this. >> All right. Thank you for having me.
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