Jeff Korn: I’ll let Doug answer, but it is helping us some. And I wouldn’t – can’t wouldn’t be the verb I would’ve used. I would’ve used shouldn’t because some of our competitors were paying spiffs that made it unprofitable to take the business, but they had dreams of acquiring revenue and they paid an unreasonable amount for it thinking it was going to get a multiple of 5, 6, 7 at multiples of one or two on valuation. It doesn’t make sense. So, I think the market has rationalized and stabilized, but I’ll let Doug give a little more detail on that
Doug Gaylor: Yes. No, we still see a lot of those extremely unprofitable spits out there from our competitors. And sometimes it just boggles the mind at what some of these guys are offering to try to gain a new customer. I think our model has been very consistent and I think our partners appreciate that and the fact that we do a good job for the customer and our customers are extremely happy after the fact. So, I think a lot of the competitive challenges out there are still there. But I think it’s making a lot of our bigger competitors reevaluate. RingCentral in their most recent comments said that they’re going to start focusing on the SMB market as opposed to the enterprise market. That’s where our sweet spot has always been. So, I think we’re doing things right out there and people are starting to take notice.
Maj Soueidan: Okay, that’s all I got. Thanks.
Operator: Our next questionnaire is Kate Knop with B. Riley.
Kate Knop: Hi there. On for Josh today. So, I just want to go back to the international expansion a little bit here. So, I know on the last call, last quarter’s call, you talked about having maybe 20 or so international service providers. Has that number improved at all? And if you could talk a little bit more about maybe some more tangible data points you’re seeing from the international expansion?
Jeff Korn: Sure. I’m going to let Anand answer that.
Anand Buch: Yes, so let me speak to that. I think as a function, I think Doug has mentioned, if you look at all of our licensees as a whole, we’re at 220 plus. And so, if you look at the international market as a percentage, and as we’re growing, it’s obviously a market that we started expanding into only a couple of years ago. So, to answer your question, yes do we see the increase of one or two additional every quarter? That’s typically kind of where we see, and you can kind of look at the numbers. Now specifically, if you look at what’s happening in a lot of the international markets, if I speak from a macro perspective, is they are actually behind the curve when it comes to, or in their evolution to convert to the cloud.
But the way business is done in those markets is a little bit different from the types of channels that we have. And so, what we’re doing is we’re grabbing partnerships just like the one in Australia, for example, of additional players that are taking a channel strategy to market. So, we can leverage that given the size of our team. But in general, you’ll kind of continue to see that ebb and flow, but keep in mind that relative to obviously when we started the original footprint in North America, the evolution of the customer journey is kind of trailing that path.
Kate Knop: Okay. Helpful there. Thank you. And then can you – so I know one of your new focus, probably existing, but also you, you highlighted it early on in today’s call, focus on winning larger businesses and larger enterprises here. So, can you just share a little bit more about what you’ve seen in the quarter in terms of winning larger business and kind of a roadmap for the future?
Jeff Korn: Sure. I’ll pass that on to Jon. Jon?
Jon Brinton: Sure. Hi Kat. So, on the – in the two parts of the business, we’re seeing a larger customer, a larger potential licensee. So, I’ll take the Telecom Services side of the business first, where we have seen growth overall continuing to trend up on our average customer size. And part of that is we – a few months ago, we introduced an omnichannel CaaS offer, which helps us expand better into a medium and large size market. Part of it is the growth in our distribution through master agents, as Doug mentioned earlier, which is helping us also speak to a larger customer. And we continue to see really good growth in that funnel. Sometimes those opportunities take a little longer to close than the pure SMB stuff. So, we’re working those through the funnel as they close, but we’re continuing to see good expansion there across our retail offers.
On the licensee side of the business for Software Solutions, we are seeing larger service providers turning to us than we would’ve seen before, partly because of things – trends we’ve talked about before with the Cisco BroadSoft acquisition now being several years old, and Microsoft’s Metaswitch acquisition being several years old, and beginning to – we’re getting converts from people that have been in their larger service providers that have been in their partner base that are licensing our platform to deploy it as part of their UCaaS offers as a competitive alternative to the offers from Cisco and Microsoft. And we’ve had – we’ve talked a bit about some of the key wins publicly. Last quarter, we also had a nice new add from a Microsoft Metaswitch partner who chose to license our platform for their UCaaS offering.
So, in that part of the business as well, we’re continuing to see growth into a market segment that we hadn’t worked in before.
Kate Knop: Okay, great. That was helpful. And then just one more from me. So, I know in the past, you’ve talked about renegotiating rates with vendors and suppliers to reduce costs further as a part of like you guys’ greater plan. Can you talk about any updates you’ve seen on that front?
Jeff Korn: Yes, Kat, that’s an ongoing process. We look at all of the contracts from the individual companies, well, or individual companies, and we combine them and renegotiate prices with one vendor to get a lower price. I can’t give you – I don’t want to give you specific examples, but it’s an ongoing process and we do it regularly, and we look at every expense every quarter, and where we sue duplication, we seek to avoid it.
