Avaya Team Penske Teleconference Transcript

May 1, 2015

MERRILL CAIN:  Thank you and good afternoon, everyone.  I'm Merrill Cain with Team Penske, and thanks for joining us today on a special media teleconference.  We welcome members of the press along with industry analysts to the call today as we're excited to discuss the announcement made earlier this afternoon that Team Penske is partnering with business communications leader, Avaya, as a team sponsor for the 2015 season in both the Verizon IndyCar Series and in the NASCAR Sprint Cup Series. Through the team's established relationship with HP and with the new partnership with Avaya, Simon Pagenaud will drive the No. 22 Avaya Team Penske Dallara/Chevrolet in at least four races this season, including the 99th running of the Indianapolis 500 later this month. Avaya will also adorn the side of the No. 2 Team Penske Ford Fusion driven by Brad Keselowski in the NASCAR Sprint Cup Series race at Kansas Speedway next week. 

We hope everyone received the images of the two Avaya cars that were distributed with the press announcement earlier today and got a chance to see how beautiful both cars look, by the way.  Joining us on the teleconference are Joe Manuele, Vice President of Global Cloud Services for Avaya.  We also welcome David Dowse, Vice President of Communications, Industry and Strategic Partnerships for HP Enterprise Solutions.  And we have Team Penske drivers Simon Pagenaud and Brad Keselowski on the line with us as well. Gentlemen, thanks for participating in the call today.  We'll begin by getting some opening comments from all of our guests, and then we'll open it up for questions from the media on the call this afternoon.  Let's start with Joe Manuele from Avaya.  Joe, why does this opportunity to work with Team Penske and two proven winning drivers like Simon and Brad make sense for Avaya?  

JOE MANUELE:  Thanks very much Merrill.  I guess the journey with HP started about eight months ago, and Avaya's been getting out there, getting our brand a little bit more recognized as we transferred our company from New York to Silicon Valley.  So we've adorned our name onto the new MLS Stadium for example in San Jose, where Avaya Stadium is home of the San Jose Earthquakes. And so I'm pretty pumped to be participating on this call with the most successful team in racing history with Team Penske, in a sport I grew up watching alongside some great racecar drivers that I admire and respect greatly. 

I want to share a little bit of background between our partnership with HP and talk about how we got here. Back in August, Avaya announced an extended partnership with HP. Together, HP and Avaya deliver cloud-based, unified communications and contact center services for enterprise teams and customer engagement. And if you flash-forward eight months later, here we are embarking on a partnership with Team Penske that was fostered through the established relationship between Team Penske and HP. The new relationship with Team Penske is the latest sports partnership for Avaya as we continue to build our brand by working with winning programs, including most recently the Winter Olympics in Sochi. I mention the Avaya Stadium relationship and then various other venues, for example the Pepsi Center in Colorado and the Montreal Canadiens, my hometown, and I'm cheering for the Habs tonight as they're going onto round two. 

Motorsports like NASCAR and IndyCar are built on relationships between fans, sponsors, drivers, crews and others coming together for shared social experience that is truly bigger than the sum of all of it parts. And as such, we're proud to offer our technology and our expertise at Team Penske as it creates engaging communications experiences for these audiences. And as the technology continues to revolutionize communications and racing, we think the partnership between the three organizations, all of whom are number one in their respective spaces, puts everyone, stadium fans, armchair racers, from drivers, pit crews, sponsors, etc., in the winner's circle.

MERRILL. CAIN:  Thanks a lot, Joe. We're all excited for the new partnership, and we look forward to growing in conjunction with Avaya.  So welcome aboard.  Now for David Dowse of HP, David, with HP's experience in working with Simon Pagenaud in the past in IndyCar, can you talk about the challenge of growing this partnership with him, and also with a new team this season? 

DAVID DOWSE: Absolutely.  So we've had a long relationship with Team Penske at HP, and it's just been absolutely fantastic. And now it's just really wonderful to have the opportunity to extend that relationship out to Avaya. As Joe said, we formed a long-term relationship with Avaya last year. And that allows our two companies to offer to business a combined portfolio of integrated communication and infrastructure modernization solutions. And that leverages the best capabilities from each firm to address what businesses are now increasingly seeking, which is the ability to provide cloud-based models that allow for faster deployment of new and easy to manage communications and collaboration technologies that really improve efficiency and performance in a cost-effective way.  This is a relatively new and innovative arrangement between HP and Avaya, and it uniquely addresses the opportunities for our firms in a fast-growing market. Now by also being able to promote this relationship with a leading organization known for performance like Team Penske, this can only accelerate these objectives for our customers and HP and Avaya. 

MERRILL. CAIN: Thanks very much for the comments, David.  And let's hear now from the drivers, Simon Pagenaud and Brad Keselowski. Simon, you've definitely had a successful history in the past in the Verizon IndyCar series with HP. So why are HP and Avaya such a good fit for a technologically-advanced series like IndyCar? 

SIMON PAGENAUD: Thank you. I really want to welcome HP and Avaya to Team Penske. It's truly an honor to represent them, and be an ambassador of their brand.  So it's certainly a perfect fit. I mean communication in racing is such an important thing, especially with our schedule being so tight in the Verizon IndyCar Series.  When we come back to the shop or on the road, we need communication to be as fast as possible and as efficient as we can make it. So it is a really, really good fit.  But also the IndyCar Series is becoming so sophisticated that having the opportunity to work with Avaya is a perfect partner to Penske for this. 

MERRILL. CAIN: Appreciate the comments, Simon.  Now for Brad Keselowski, who's going to hit the track here in just a little bit in Talladega. We appreciate Brad taking time to participate in the call today. Brad, the No. 2 car will race next weekend in Kansas with the new red and white, Avaya livery, and it will be the brand's first appearance in NASCAR. Can you just talk about the opportunities that are out there for a company like Avaya in NASCAR? 

BRAD KESELOWSKI:  Well yeah, absolutely. I think NASCAR is trying very, very hard to continue to push the technical side in having more technical partners, so I think this is not just a win for Team Penske, but also a win for all motorsports and NASCAR in particular. So I'll be glad to join the team and to have them on our car and hope we can have a great race for them. 

MERRILL CAIN:  Sounds good, Brad.  We look forward to seeing you in action in the Avaya car.  With that, we're ready to take some questions from the media.  members on the call today.

Q:      Hi, Brad. I have two questions for you.  Number one, how important is it to consistently try to get new sponsors in?  You're a team owner and a driver for a team. And number two, what's your outlook for Talladega this weekend?  

BRAD KESELOWSKI:  Yes sir, well thanks for asking. As far as sponsorships are concerned, I mean they're really the lifeblood of our race teams. Obviously there is some purse money that we are able to obtain when we perform very well. But even with that said, I know on the Truck side and on the Cup side, usually about 70 or 80% of a team's budget comes from the sponsorship side. So obviously sponsors are very important, and we're glad to have them. And we try to do more than just have sponsors. We try to have partners, which means that not only is there the financial side of it. We work together, and we find solutions together. And I think Team Penske probably does that as well if not better than anyone else. So this relationship is certainly along those lines. As far as Talladega is concerned, coming back here this weekend, obviously I won last October, when we were here. And that was such a key win for us. So it's always a lot of fun entering a racetrack that you won at the last time you were there. And so we're carrying a lot of momentum in that sense and look forward to hopefully getting another win here in Talladega. 

Q:      Hi, Simon.  It's not unusual for teammates to try out the other teammate's car. I'm wondering if you've given any thought to jumping in a Sprint Cup car just for a tryout run. 

SIMON PAGENAUD:  Well I would love to. I would love to. You know, I enjoy all sorts of racing. Obviously the Verizon IndyCar Series is my priority, and that's what I love doing the most. And being with Team Penske now, having such great opportunity, it's a dream come true. But in the future, why not?  I certainly am always watching Brad doing so well, and Team Penske is so strong right now. It would be a lot of fun to do a swap someday.

Q:      Hi Simon, question for you.  Now four races into this season, how comfortable are you with where you're at in the team?  And are you kind of ahead or behind, or on pace with where you thought you'd be within the team? 

SIMON PAGENAUD:  Well it's going pretty well, actually. Unfortunately the results don't really show the performance. But that's the growing pain of a new team, you know.  On the 22 side, we have new people, people that have not worked together that now are working together. So there's a need for transitioning, a need to understand how to optimize everybody and get the best out of everybody at each race. So far, I think I'm pretty satisfied with the performance. We just need to execute fully. We already have four races behind us, and I feel a little bit like Brad actually. I feel like going into Indy Grand Prix where we won last year is a really good opportunity for us to maybe unlock what has been going on for us. So the month of May is really exciting, especially with this announcement today with HP and Avaya. So it's all very good news for us at Team Penske. 

Q:      Brad, I had a couple of questions for you. The first one, of all the places that you compete in NASCAR, obviously Talladega is considered one of the most unpredictable. You needed to win to advance last year in that race that you won.  Can you talk about how clutch of a performance that was in an effort from you to get that done? I mean it's one thing knowing you have to and another to do it. And my second question is just that you have another major thing coming up in your life at the end of May, and I wondered what kind of plans you have made in terms of racing, contingency plans in case you become a father on race weekend. What is going to happen then? 

BRAD KESELOWSKI:  I like your questions. Thank you very much. The first question about Talladega, I mean yeah, last fall was unbelievable. I think that's probably the most emotional I've ever got besides my first win in NASCAR, which would've been in the Nationwide Series at the time in 2008. Going back to that, that's probably the most emotional win I've had in quite some time. So it certainly meant a lot to me. As far as kind of the clutch factor or whatever, I try not to read too much into that. I feel like if you get caught up in that, you kind of let those emotions get to you, and sometimes that's maybe not in your best interest focus-wise. You get so caught up in the moment that you can kind of lose attention to the details it takes to perform. But all in all, that was just an incredible weekend, and one that I'm going to look back on for quite some time and be proud of. But I'm also going to be very proud, like you said, in a few weeks, hopefully in the next two weeks, when I become a father. So that's something I'm very much looking forward to. As far as contingency plans, we really haven't made any because we're very, very fortunate that everything at this time looks to fall directly in line with the race week Charlotte, which is where we live. And hopefully we can accommodate in that sense. So fingers crossed, we'll see how it all plays out. But I'm looking forward to it very much. 

Q:      Okay, and now just to make sure I have that right, so you have not, there's no driver on standby yet, because you're hoping things are going to fall exactly in line? 

BRAD KESELOWSKI: Yeah, yeah pretty much. Yeah, a little bit of shooting from the hip, but that's okay. I just have this feeling that everything is going to work out. It's going to work out great.

Q:      Thank you very much.  Question for Brad and for Simon if I could. Could you talk a little bit about the kind of unusual but not really unusual, but significant fact that you belong to a team that has both open wheel and stock cars, and you guys kind of share a lot of different things for different types of driving?  And then to pick up two sponsors here that you're also going to share.  

SIMON PAGENAUD: Yeah, there’s always things you can cross over. There’s always interesting things that an engineer on the NASCAR side could come up with, that would be interesting for INDYCAR. The technology is quite different in both series.  But the engineers are, whether they’re in NASCAR or INDYCAR, always super smart. So there’s always good information there. 

And Penske is very open, in-house, and everybody works together. So there’s some advantages, for sure, to be under the same roof. And I think it translates into results. As you can see, on the NASCAR side, they’ve been very successful this year. And on the INDYCAR side, we’re having a tremendous start of the season, with really strong performance. So I do think it relates in this.

BRAD KESELOWSKI: Yeah, from my side, I think it’s been great. I think it’s an advantage, in so many different ways, whether it’s the facilities cost, being able to take advantage of that and reduce some overhead. I think that’s great, from a team perspective.

But then I think, probably more importantly, about the people perspective. And I’ll give you an example, or two examples actually. One of the engineers from my Cup team left and became the head engineer for Juan Montoya, and his efforts on the INDYCAR side. So there’s some great cross-pollination there.

And then we had one of our young up-and-coming mechanics, that came up through what’s now the Xfinity series, was part of our championship team in 2013, moved over to the INDYCAR side in 2014, and was part of winning the championship with Will Power, and now has returned to the NASCAR side, specifically to Sprint Cup, and is now one of our lead mechanics. 

So I think it’s great to be able to share people back and forth. It helps open up their minds and perspectives to different parts and technologies that might exist on one side and not the other, and kind of help us cross-pollinate those two, the advantage of both efforts.

Q:      Simon, you’re getting ready. In about a week, you’re going to be out there, trying to defend your championship (at the Indianapolis Grand Prix). How do you expect this experience in Indianapolis to be a little bit different, maybe, than what you’ve experienced in the past, now that you’re a defending champion?

SIMON PAGENAUD:  Well it’s already – like you said – it’s already been pretty different to last year. I’m really busy, with a lot of commitments, so I guess it’s a really good thing. And Team Penske is also pushing really hard, on the media side to get my name out there. So it’s certainly a lot busier, a lot more time away from the racetrack. 

But I feel great. I feel like we have a great chance to have a good race. The event is growing. People are excited about the Indy Grand Prix this year, in Indy. And I thought it was a really good event last year, with a great racetrack. 

And personally, I’m confident because it really suits my driving style well. And the car has been beautiful, all year long. So we should have all the ingredients to do well. Hopefully, we have a little bit of luck, and should fall our way, hopefully.

Q:      Is it different, being with a team that puts so much into the 500, and the pole position, and that sort of thing, as well?

SIMON PAGENAUD:  Yeah, well you know, they put everything they have in everything.  That’s the nice thing about Team Penske is there’s no margin for error. They’re working on every front. Every little detail is worked on. So the Indy car itself, there’s another chassis on the side that has been worked on over the winter. And it’s being buffed on right now, to penetrate the air perfectly. 

And the road course, car, as you could see, has been really strong all year. So I have no doubt. That’s the really cool thing about being part of this team, is I have never any doubt about the preparation of the team. It’s about me to do the job, really.

Q:      Simon, today have you spent most of your day, thinking about oval track or road course?  Because it’s interesting that you’ve kind of got both going here, in the next couple days. And then kind of just talk about the excitement of not knowing whether one aero kit is going to be better than the other one.

SIMON PAGENAUD:  That’s a good question. I ran on the track yesterday, and I didn’t know which way to go. So obviously, in road course setup you focus on the road course. And we don’t have all that information on the oval kit yet. So it was interesting on the track yesterday, interesting difference. I’m really excited. I think we should have a really good package, with Team Chevy.

But certainly, like you said, you need to keep your concentration on oval mode or road course mode.  But right now I’m focused on Sunday.

Q:      Hey Brad, just a quick follow up. Is there a chance that this partnership will extend beyond Kansas, and you an Avaya will do more races in the future?

BRAD KESELOWSKI: I would say there’s always a chance for growth. I kind of let Roger and Walt (Czarnecki) and all the guys, Jonathan Gibson, figure the details out. But certainly, we always hope so.

Q:      I wanted to follow up with a question here for Joe, with Avaya.  Joe, if you can, can you elaborate and kind of provide an example, of what the cloud-based unified communications and contract center services for enterprise team, customer engagement?  That’s a lot for all of us to follow in the racing industry, but I’m sure you can put it in terms that we all understand.

JOE MANUELE:  Yeah, it was fascinating, just listening to the call and just talking to Brad and to Simon, prior. What’s amazing about Team Penske is the breadth of the racing team, being both in NASCAR and in INDYCAR. The teams do have a lot to learn from each other. And it’s interesting to hear from Brad that a mechanic is moving over to different teams and passing on that information.

That’s really what we’re about. We’re about enabling collaboration between teams.  So if you’re a large company, it’s between getting the sales teams talking to marketing more effectively. And then in a fan environment, we developed specific applications on smartphones, for example, in Avaya Stadium. We allow the fans to tweet pictures of themselves. We have fan boards up in the stadium. 

And then, if you’re at the event, there’s a specific fan experience. And if you’re not at the event, and you have the ability to follow it on the internet, through social media, it really expands that social experience, that fan experience. And that’s really what we’re about.

So in layman’s terms—and I know we use a lot of industry buzzwords, here in the valley, three and four-letter acronyms. But we allow teams and people to share experiences. And we’re really, really excited about the potential. 

Listening to Brad—and Brad is going to be racing on Mother’s Day, in Kansas City, so great question there. So back to the interesting timing, where we make our NASCAR debut. We’re really going to be paying attention to how we can help. And we’re happy to be there.

We’ll be observing and we’ll offer tips on how they can use our technology to maybe share information better. And if it gives them a little bit of a competitive edge, then great. And then that’s really what we’re excited to be a part of the team with.

MERRILL CAIN:  Thanks, Joe. We really appreciate that. I think that puts it in perspective for us. And we’re excited about the technology. We’re certainly excited about the partnership. Looking forward to seeing the Avaya cars on track with Brad, next week at Kansas,and obviously with Simon, coming up here at the Indianapolis 500, in just a couple of weeks.

And with that, it will conclude the special Team Penske media teleconference.  Thanks to the members of the press that participated on the call today. We also appreciate Joe Manuele, David Dowse, Simon Pagenaud, and Brad Keselowski for being our guests during a busy day for everyone.  Thank you, gentlemen.  We appreciate it.