Demand to deliver – IT infrastructure

August 6th, 2014, Published in Articles: EngineerIT

From sales, operations, finances, procurement, warehousing and distribution through to the executive, IT departments are facing unprecedented pressure to enable the transaction and improve on communications and collaboration.

Service providers and vendors are touting voice, video and cloud-based applications and storage facilities as the Holy Grail.

The internal customer in an organisation’s various business divisions wants more of everything. Demand for 24x7x365 access for all role players, differentiation in the market place, along with hunger for information, and the ability to analyse and use it, is putting pressure on the enterprise’s private virtual private network and stretching the IT department to its limits.

Facebook, YouTube, Instagram, iTunes, streaming media and other social media networks, along with cloud-based storage, are consuming bandwidth faster than the enterprise can roll it out. The bring your own device revolution is disrupting business in ways we are only starting to fully understand. Most businesses are merely playing catch-up. Mobility by way of tablets, smartphones and laptops and social media networks that enable conversations with brands has disrupted the manner in which customers and service providers interact with companies, and enable customers to be far more educated and engaged than ever before.

When I go shopping, for example, I understand what I am buying, what it costs at ten different stores and I have a good understanding of all the specifications long before I arrive at the retail store. I am often better informed than the sales person I am buying from. So whilst the sales person is telling me that their offering is the cheapest in town with the best service levels and the best products, I’ve already done a price comparison online, read customer complaints and compliments, and weighed up the benefits of making the purchase from them or their competitors.

This is true from white goods, through to food, clothes, vehicles, electronics and almost anything you could think of. As a result, the sales person, support agent, receptionist, manager or driver involved in the transaction needs to be empowered to deal with a significantly more knowledgeable and empowered shopper.

In order to empower its employees to deal with these new demands, the enterprise needs to train and up-skill people, retain and distribute institutional knowledge, and collect and analyse the data it needs to ensure better decision-making and to evolve the business on an ongoing basis.

To complicate matters, whilst the cost of bandwidth is coming down, both the consumption of and demand for bandwidth from the end user, along with the expectation of 24x7x365 access is pushing IT departments and their budgets into uncharted territory. Any savings from bandwidth cost reductions are inevitably lost to an apparently insatiable demand for throughput.

This is the cause of some frustration in CEOs and CFOs who do not understand why IT costs are going up when bandwidth costs are dropping. The viewpoint is often that employees want a BMW when they can drive a Golf. This indicates a lack of understanding of ITs role as a business enabler.

Technology is now involved in every aspect of business. All stakeholders in the enterprise are looking to IT to provide the connectivity, the access, the storage, the applications, the collaborative tools and the communication tools that will deliver on this vision – when they need it and where they need it. And the CEO who is not intimately involved in IT decision-making, and who doesn’t understand the competitive edge it offers his business, is missing a significant opportunity to gain an edge on his competitors.

Nowadays the astute CEO is more likely than ever to be involved in IT. The CIO no longer frets alone about IT. The message is getting through to the executive that to ignore the benefits derived from IT as a business enabler is to become uncompetitive, irrelevant or, even worse, to go out of business.

The problem with all of this is that IT is expected to deliver next year’s technology vision on last year’s budget, with the same resources it has always had.

Sharing ITs budget with an enterprise’s divisions and/or branches has always been a tough sell. In today’s evolving landscape finding ways to apportion costs, measure and manage those costs and report thereon just got that much more difficult. Increase costs and you can expect serious pushback. Don’t deliver and you will get serious complaints.

How do the CEO, CIO and their IT manager manage this demand and the associated challenges and cost of delivery? The days when the IT department carried the cost and then apportioned those costs to each user in each department and carried the can for over-spending, are gone. The IT department can no longer hold up the budget for the business on its own.

Whether you are reading McKinsey or IBM whitepapers, or just using good old common sense, you cannot get away from the fact that if IT is to be an effective enabler it needs to work in partnership with the people driving the demand.

Where to start?

• Include all stakeholders in planning, budgeting and implementation.
• Understand the company’s growth drivers and business priorities and gain a thorough understanding of the demand for and consumption of IT services.
• Listen to the company’s divisions and their business need, offer tiered options at different costs and partner with them.
• Build flexible, scalable and cost effective networks, ready to deliver on the business’ needs.
• If you don’t measure it, you will never manage it. Measuring the consumption accurately along with regular reporting to the units on progress, costs, and challenges, will ensure business units buy into the timeframes, solutions and/or services as well as the associated costs.
• Shift the responsibility for managing costs onto the end user. The sub-text being that if you want to consume large amounts of data and have all the bells and whistles, you are going to need to pay for it.
• Ensure that buy-in to a solution includes both a clear mandate to source solutions and/or services and explicitly specifies that the end user is willing to budget and pay for said solution.
• Use the fact that everyone is carrying the IT budget to resource and up-skill the IT department, ensuring that the IT department delivers a great service at a good price.

If you wish your business units to be fully onboard, supportive and willing to pay for what they use, bringing the role players into the design, costing, procurement and implementation phases of solutions/services procurement will stand you in good stead and ensure buy-in, careful use, budget to pay for it and, most importantly, that the solution is relevant to the business need.

When supply equals demand, and all the business units are paying their fair share, the IT department’s role in business will have evolved to the place it needs to be.

Auditing and Benchmarking your communications costs

You don’t know what you don’t know, and you cannot manage that which you don’t measure.

CommsCloud believe that managing communications expenditure without Business Intelligence [BI] tools and the insight it affords role players could be equated to running a large business without accountants or computers. The opportunities afforded any decision maker are significant when you are making well informed knowledgeable decisions based on fact.

CommsCloud’s point of departure for any new project is twofold;

1. Gain a detailed understanding of the communications costs before offering up any opinion
2. Ensure that all the role players are well informed of the results thereof and obtain buy-in on a way forward

CommsCloud starts by performing an Audit [and benchmarking] of all communications infrastructure for both fixed and variable costs. During this Audit phase we benchmark your communications costs against market trends in SA and CommsCloud’s "Best Practice Standards". We then present the “BI” derived from this process to all the role players in a way that makes sense and allows the role players to relate to the opportunity and play a definitive role in building a communications strategy.

The information we gather and report on in during the “Audit phase” informs the decision making for all the roles players going forward. This process not only highlights opportunities but also savings and ROI on any project.

CommsCloud have found the process will;

• Ensure that all role players are well positioned to make decisions and understand
o their unique business need
o fixed and variable costs
o infrastructure efficiencies and problems
• Highlight problems and opportunities; thus enabling decision makers to
o define a common goal and purpose
o define a strategy
o understand where to start and what to start with
o measure success of the implementation on any project
o hold vendors and service providers accountable after implementation of a solution to the “promised” efficiencies, costs savings and SLA

CommsCloud have a strong track record when it comes to managing organisations with large geographical footprints. We have the requisite resources, project management skills, supplier relationships, product knowledge and “Best Practice Standards” required for a project of this nature. Any business wishing to improve efficiencies, effect savings, upgrade technology and business processes, put together a strategy and managing a large geographical footprint will find it difficult to do so without a partner such as ourselves.

CommsCloud will help your business manage the process from A to Z and ensure a successful implementation of any communications project, be it infrastructure or a solution.

We hope this overview enables you to get a sense of what is possible using our unique methodology and would welcome the opportunity to give your business more detail on the processes, the BI reporting and how we could simplify your project.

For further information see;

• www.commscloud.com
• http://www.linkedin.com/in/peterwalshzar

Cape Town - September 2011

Bandwidth glut? | Brainstorm Magazine

Africa's predicted bandwidth glut hasn't quite arrived yet.

BY Lesley Stones , 7 July 20110 comments

photo: Suzanne GellRaj Wanniappa, Internet Solutions

Remember the days when Africa was starved of bandwidth? Of course you do, because it still is.

Yet with all the underwater and overhead activities in the telecoms industry, you could be forgiven for thinking Africa must be pulsating with all the high-capacity bandwidth it could ever need.

The latest connectivity comes from above with the New Dawn satellite, and from below with the Western African Cable System (Wacs). New Dawn is an Intelsat project backed by South African investors Convergence Partners, designed specifically to supply fresh capacity for Africa.

We asked some local bandwidth-hungry businesses what impact they expect to see. As usual with bandwidth promises, it’s great news in theory but probably less spectacular in practice.

Costs may not fall much because the bottleneck to delivering that international bandwidth to homes and businesses lies in less robust terrestrial networks.

“The arrival of the Wacs cable as well as the Intelsat satellite is welcome at a time when businesses and consumers require reduced costs of connectivity,” says Farren Roper, head of Product and Markets for FNB Connect. “It is anticipated that costs will reduce because of supply and demand considerations.”

The bank is always seeking cost savings, both for itself and for its customers, Roper says. It also uses multiple service providers for reliability and backup. So far, however, FNB hasn’t committed to buying bandwidth from either new supplier.

“It would depend on a number of things, including market price, pricing models, contractual terms as well as, most importantly, stability,” Roper says. “Being efficiency-driven, we consider all options when evaluating undersea cables and service providers.”

FNB chews through massive bandwidth, especially while a recent publicity campaign saw it offer its ADSL customers free access to bandwidth-chomping YouTube. From May until July 1, customers of FNB Connect Surf could browse the world’s most popular video site for free.

“Broadband access is reaching more consumers, and multimedia and social media are becoming more widespread and popular. We are enabling our customers to be part of this by giving them free access to YouTube,” Roper says.

You can’t imagine the Johannesburg Stock Exchange encouraging its staff to play around on YouTube, but the JSE certainly appreciates the need for high bandwidth to handle millions of crucial share trades.

CIO Riaan van Wamelen says the increasing range of alternative connectivity delivered by new systems such as Wacs and New Dawn are exciting as they are finally positioning Africa to catch up with the rest of the world, both in terms of costs and choice.

Connectivity is critical to the JSE, and the cost of bandwidth has a significant impact on its business and on the business of its clients. “The new cable systems are specifically relevant to the JSE in terms of expanding international access to the exchange. Low-cost, quality connectivity is also a vital element of expanding our reach into Africa,” Van Wamelen says.

“However, and specifically in relation to the cable systems such as Wacs, we should not expect the full benefits to be realised in the near term. In-country bandwidth is still problematic and while massive investments are being made in fibre infrastructure, it will take a number of years to bring South Africa on a par with developed nations.”

The JSE hasn’t made any commitment to Wacs or New Dawn. Says Van Wamelen: “We have evolving connectivity needs and will buy connectivity services from the providers as and when required. We will not directly buy capacity on the cable system, but it’s likely this will be bundled in existing and future service offerings we get from our telecommunications providers.”

The 14 500km cable linking Africa to England is the first to touch the Democratic Republic of Congo, Togo and Namibia, which will probably experience a far more dramatic benefit than better-served South Africa.

For a really technical reply, of course, ask the guys at Internet Solutions (IS).

“The biggest challenge to lowering price and getting better service still remains reliable last mile services,” says Raj Wanniappa, IS’ executive of Carrier Services.

The overall cost of telecommunications is a combination of international connectivity from players such as Seacom and Wacs, long-distance backhaul to carry data from coastal landing sites to the major hubs, and the last mile link from operators such as Telkom, Neotel and IS. Alternative options for any of those theoretically increases competition and should reduce costs, Wanniappa says. Often, however, organisations use the new suppliers only as a back-up for their existing services, so prices tend to remain flat or decline nominally, although capacity and service levels improve.

New Dawn will probably have its biggest impact in emerging African countries, where there is an increasing demand for satellite services to reach remote locations where terrestrial services are still not available, he predicts.

More excited than other CIOs is Johan Fourie, the Chief Technology Officer of Media24.

“This is really going to benefit online content providers,” he says. “The content is going to be so much richer. Up until now, in South Africa, it’s been flat text.

This is going to open up interactive, rich live content. The business plans of our publishers are really looking different this year because the bandwidth restrictions are going. There are some interesting things in the pipeline.”

Media24 buys much of its bandwidth from Telkom, but is increasingly buying from MWeb, a sister company in the Naspers stable. MWeb will probably buy wholesale capacity from the new suppliers, Fourie says, and resell that to Media24 at an affordable fee.

“It’s a big step in the right direction. It will open up a world of internet to South Africa. If you have bandwidth available you can stream across the world and get rich content and video and live shows.”

American media companies stream live sports matches to the desktop, but that’s not feasible in South Africa because of bandwidth restrictions, Fourie says. Yet it’s beginning to happen, since DStv subscribers using MWeb’s uncapped bandwidth can stream DStv to their desktop.

The cost of bandwidth definitely needs to fall and greedy profiteering needs to end, or such innovations will be choked. Hopefully the new players will fuel that evolution.

The last mile remains a problem, Fourie says, but Telkom and other companies have done a lot of upgrades in the past few years. Even so, the internet in Africa is still reaching a very small market.

“We need to do a massive drive to get the costs down and get technology into houses at an affordable rate,” Fourie says.

Cut the red tape, Plessey urges gov’t | TechCentral

Howard Earley

Government needs to make it easier for telecommunications operators to build infrastructure, especially fibre-optic networks, as red tape and conflicting requirements are slowing the ability of companies to build broadband networks.

Howard Earley, chief operating officer at Dimension Data subsidiary Plessey, says receiving the necessary environmental approvals and permits from municipalities and the department of water affairs to build fibre networks is becoming a big issue.

“There’s not a uniform environmental standard from one metro to the next and no uniform mechanism from the department of water affairs,” Earley says.

Earley says that although it’s important for regulations to protect the environment, new and uniform rules are
needed to guide fibre projects. Plessey is responsible in large part for the Vodacom, MTN and Neotel fibre build between Johannesburg and Durban and Earley says the project has been delayed because of outstanding licences from water affairs. “The consortium can’t get them and until they do that link can’t be used for the purpose it was intended.”

Different rules from municipalities have also slowed progress. “If you get to a bridge, one guy will say hang it under the bridge, while the next will say they want in-road trenching, and so it carries on, so there is no universal approach.”

Earley says the country would be “much better served” if there was one standard which operators were expected to adhere to.

Even within big metros, there are sometimes conflicting requirements, he says. “It would be very good if there was one overall body that decided on the standards and what was required and who the issuing party would be in terms of giving you the licence to operate.”

One way this could happen is if one central government department took ownership of the issue, though Earley admits this could take time. He feels it’s an issue the department of communications should deal with in its forthcoming broadband strategy document. “If we could just get the bigger metros to agree [on standards], that would be first prize.”

Elsewhere in Africa, environmental impact approvals are not nearly as stringent as they are in SA, but Earley thinks that in many of these markets the rules are too lax. “There should be some minimum requirements.”

— Duncan McLeod, TechCentral

Bylaws to aid Tshwane fibre roll-out

– Craig Wilson, TechCentral

The City of Tshwane wants to make it easier for telecommunications operators to deploy fibre-optic networks in Pretoria and surrounding areas with a new set of bylaws to ease their construction.

The city is set to release a document for public discussion on 1 July in which it will outline proposed bylaws dealing with the laying of fibre infrastructure in the city. The plan is to produce a set of standards for the deployment of fibre so as to minimise the impact on commuters and ensure contractors adhere to minimum standards.

An industry source, who does not want to be named because of a need to retain a relationship with both the municipality and operators, says it’s important to remember that “subcontractors are deploying assets on behalf of operators, but that the operators have no way of controlling standards. Legislation is vital if these assets are to be deployed effectively.”

Despite government’s apparent eagerness to expedite fibre projects, there is a lack of legislation guiding them. With more than 400 licensed telecoms operators in SA, the industry believes guidelines are long overdue.

Without a process for approving and managing contractors, the door is open for corruption and mismanagement, the source says. It’s said to be common knowledge in the industry that wayleaves, which grant contractors permission to trench, can be fast-tracked by means of wining and dining the right people.

Tshwane wants to automate the process of granting wayleaves to prevent this sort of practice. It’s understood Tshwane wants to partner with companies that have infrastructure in place when it can and instead use its budget to build networks in areas that won’t get fibre from commercial operators.

Industry players say streamlining the wayleaves process is essential, especially with big projects underway. For example, FibreCo – a joint venture between Cell C, Dimension Data and Convergence Partners – plans to build 12 000km of fibre over the next five years, but if wayleaves aren’t promptly processed this may not be possible.

According to the source, the fibre industry is “petrified of government because it can drag its feet”.
“The moment you apply to trench a road, you have get permission from up to a dozen individual entities, from utilities departments to other companies who have already got fibre in place. Each of these parties has 30 days to respond and some take 29 days on purpose.”

If Tshwane is able to expedite fibre projects for commercial players, it could provide a model for other cities to emulate.

What unbundling means for service providers and consumers

Drive around SA city streets and you’ll soon notice Telkom’s green and blue distribution cabinets, like the one pictured above near TechCentral’s offices in Johannesburg, writes Candice Jones.

Soon distribution cabinets of various colours could be popping up next to Telkom’s street boxes, thanks to local-loop unbundling. And their arrival could herald a steep reduction in fixed-line broadband costs for consumers and businesses.

Telkom’s distribution boxes, many of which now have fibre-optic cables running into them, are often the place where the company provides consumers with access to its digital subscriber lines, the broadband links over the copper cables that run into people’s homes.

The Internet market has long been anxious to see the local loop, the so-called last mile of copper cables that connects consumers and small businesses to Telkom’s network, unbundled.

This dream could be realised before the year is over, and rival operators and Internet service providers have to start thinking now about how they will gain access to this network to provide fixed-line broadband directly to consumers.

Worldwide, local-loop unbundling has boosted competition among Internet providers, driving down prices and paving the way for new services.

Greg Massel, CEO of alternative operator Switch Telecom, says one of the requirements is that Telkom allows competitors to “co-locate” telecommunications equipment in Telkom’s exchanges – and, closer to homes, in distribution cabinets — so they can gain direct access and provide onward connectivity over their own backhaul links.

Getting the equipment into these facilities is a big exercise, even if Internet service providers only want to serve niche areas rather than offering broadband services nationally.

“Costs will vary depending on the coverage area, the equipment used and the capacity deployed, but I think it’s safe to say the kind of investment required will limit the direct benefits of unbundling to larger service providers,” says Massel.

But he says smaller service providers will have more options when looking for alternative wholesale suppliers, which may help drive down prices.

For many local Internet providers, backhaul will be a key consideration. Web Africa CEO Matthew Tagg says getting fibre to Telkom’s facilities will be the biggest factor influencing how successful unbundling will be.

However, Tagg says alternative fibre network suppliers like Dark Fibre Africa have begun providing backhaul links, which should help keep prices down.

The process becomes complicated in areas where Telkom doesn’t provide broadband access over copper from its traditional telephone exchanges, but rather from the distribution cabinets along city streets.

In recent years, Telkom has actively laid fibre closer to people’s homes, running into distribution cabinets, and shortening the distance between consumers and high-speed fibre backhaul. Shortening the local loop in this way has allowed Telkom to offer higher-speed broadband, up to 10Mbit/s in some areas that are served by Metro Ethernet technology.

But it also means Internet service providers have to start thinking about deploying their equipment in those boxes, or even building their own, says Tagg. The problem is there isn’t much space in Telkom’s cabinets, so alternative providers will have to consider building their own cabinets nearby.

There have been suggestions that Telkom could offer what is called “bit-stream unbundling”, where it provides all the equipment other service providers need to connect customers. In this scenario, service providers won’t need to provide their own facilities in the exchanges or build their own distribution cabinets.

“The industry should have had bit-stream access from when Telkom first introduced digital subscriber lines,” says Tagg.

He says to propose bit-stream access as an alternative to full unbundling is “a big cop-out”. “It will do very little to drive competition or produce real change for customers.”

Tagg says full unbundling has been “very successful in Commonwealth countries such as Australia and New Zealand”. Increases in speeds and broadband quality in those countries can be directly attributed to the increase in competition brought on by unbundling.

“We are already playing catch-up with countries like Australia. By my estimation we about seven or eight years behind,” says Tagg.

Though smaller operators are looking forward to unbundling, larger players are wary of committing themselves to exactly what will be needed to take advantage of the process.

MWeb CEO Rudi Jansen says what will be required will depend to a large extent on what the regulator, the Independent Communications Authority of SA (Icasa), stipulates must be unbundled.

The authority last week revealed, in an exclusive interview with TechCentral, that it hopes facilities-leasing regulations will be enough to force Telkom to provide competing operators access to the local loop.

In terms of the Electronic Communications Act, the local loop is considered an “essential facility” since it is a key aspect of the telecoms environment and operators are now able to demand access from Telkom.

However, Jansen says facilities leasing is only a portion of unbundling and will only take the process so far.

“At the end of the day we are all in the hands of what Icasa decides and how much Telkom would like to open up and under what conditions it will allow us into their facilities,” he says.

“We need naked digital subscriber lines, where telephone and broadband line rental is split and not a situation where one is conditional on the other,” Jansen says. “More exchanges need to be upgraded to be broadband-capable and investments need to be made in access speeds,” he says.

However, he says Icasa is not entirely on the wrong track. “For now, I think the regulator must go for the easy wins that will give immediate benefits to all.”

Internet Solutions MD Derek Wilcocks says the best bet for local-loop unbundling is for the country to impose on Telkom what UK regulator Ofcom imposed on Britain’s incumbent fixed-line operator, BT Group.

BT spun off its local loop into a separate, independent company called Openreach, which manages, maintains upgrades and leases the local loop to competing operators, including BT itself, and does it in a way that is transparent to all market players.

“Creating a wholesale, transparent spin-off would be the most practical short-term solution for getting things done,” says Wilcocks.

However, he says Telkom is preparing new products that indicate it is taking unbundling seriously. “For example, it is offering aggregated capacity at the larger exchanges to competing providers, instead of charging for every circuit in that exchange.”

Whether Internet service providers will gain access to the local loop this year remains unclear. However, most industry players are hoping Telkom will meet the November deadline set by communications minister Roy Padayachie.

Comms Cloud moving from concept to business reality

It is with great excitement that I watch our new telecoms concept, Comms Cloud Managed Infrastructure Services, move towards becoming a reality.

Next week sees our branding and corporate identity being unveiled to us for the first time and I have started pitching “next generation” ideas to customers that I have long standing relationships with.

What is fascinating for me is the endless opportunity for optimisation, technology upgrades and the resultant business benefits [savings included] that are on table for businesses today. Disruptive technologies rule!

Watch this space carefully; we are going to offer clients a viable and exciting new offering within the next few months.

Peter Walsh
Cape Town
January 2011

Making the connection | ITWeb

Andy Robb, Technology specialist at Duxbury Networking.
3 Nov 2010

The market is flooded with Internet connectivity choices. For example, there are many flavours of ADSL available, linked to a variety of speeds with capped or uncapped, shaped or unshaped, network bandwidth alternatives. ADSL services are available over fibre or copper media with prices ranging from around R39 to over R4 000 a month.

The consumer is further confused by the constant evolution of 3G and 4G technologies, delivering ever-increasing speeds via a plethora of service platforms.

What's more, the 'traditional' TDM-based options – Diginet, Frame Relay and ATM – remain in the marketplace, seemingly to add complexity to the WAN 'mix'.

What is the right choice? In days gone by, connecting to the Internet was a simple task. The first choice was a dial-up connection for key people in the organisation. As more personnel needed to be online, so the corporate network evolved to include them.

Growing up

As companies grew, so the options of either Frame Relay or a 64K Diginet line appeared on the horizon. The progression to a 128K Diginet connection was obvious as demands increased. As more services were needed, the upgrade to a 256K Diginet connection became necessary. The progression was natural and seamless.

At the turn of the century, with the increase in sophistication of available services, so businesses opted for MPLS-based networks from a growing band of service providers.

But since then there has been no logical 'next step' forward. Despite a plethora of vastly improved connectivity solutions on offer, featuring new-age technologies, the way forward has been blocked by a minefield of indecision. There is little indication of what option is appropriate for a business of a definite size or an organisation with specific service requirements.


Decisions, decisions

The way forward has been blocked by a minefield of indecision. The marketplace today is characterised by confusion. For example, for most small to medium-sized businesses, the traditional leased line solutions are far too expensive. What about the new technologies? Should they opt for a 4Mb ADSL connection?

The answers are not obvious. There are issues with continuity of service as the copper cabling associated with ADSL services is subject to theft on a regular basis. What's more, no watertight service level agreements are linked to this option.

Educated guessing

In this vein – and no matter what ADSL solution companies choose – it is difficult for them to predict the reliability of the service. Today, bandwidth seems to be throttled at the most inconvenient times. Reasons are seldom given.

The same is true of the 3G solutions on the market. Even though their perceived throughput is significant compared to other technologies – for example, 21Mbps will soon be available from Cell C – the reality is that data rates often vary from hour to hour depending on the number of active subscribers addressing a particular base station, and depending on what kind of data they are pulling from the Internet.

Another drawback with 3G technologies is that they were originally designed for ad hoc use on mobile and smartphones and not as primary connectivity mechanisms capable of meeting the capacity demands of today's corporate customer.

Instead, WiMax was supposed to fill this role and represent the next step in the evolution of the WAN for the corporate market. But the technology has failed to achieve general acceptance, perhaps because networks weren't deployed fast enough, and the speeds and throughputs on offer from WiMax service providers have proven to be lower and less competitively priced.

The question on most financial directors' lips today is: “Am I getting the best bang for my buck?”

Other often-asked questions include: “Are Internet service providers giving me the best advice? Are they analysing my business requirements correctly? Are they proposing the correct solutions to my board?”

Encouraged by the service providers who seem able to conveniently side-step these key questions, companies often simply install as much connectivity as they can afford and hope for the best.

As a result, corporates tend to gain very little visibility of the services they are paying for. They need to know about the difficulties facing ADSL service providers who can't guarantee service levels because they're most likely making use of a Telkom infrastructure. They need to be aware of the challenges facing 3G service providers who are equally hamstrung by inexplicable network congestion issues.

If there is no clear best fit, it's most likely because there isn't one. Business is in the unfortunate position of having to install multiple connectivity solutions – an ADSL primary service with a 3G backup, for instance. Or a leased line with ADSL backup... or fixed point-to-point wireless backup. Or multiple ADSL services addressing various departments and remote sites...

Against this backdrop, it behoves all consumers to make the effort to come to terms with SA's connectivity vagaries – to ford the treacherous waters of WAN connectivity and try to emerge more knowledgeable and 'street-wise' as a result.

Vodacom takes on Telkom | ITWeb

By Nicola Mawson, ITWeb senior journalist.

Johannesburg, 29 Jun 2010 Read in this storyBattle lines drawnBusiness solutionFail safeSmart moveSA's largest mobile company, Vodacom, is taking on its former parent, Telkom, as it launches an ADSL service into the corporate sector – with plans to eventually cut out Telkom's copper last mile.

The company could also try and usurp Telkom's dominant position in the residential market, but has yet to make an announcement as to whether it will launch fixed broadband to homeowners.

Vodacom's venture into fixed broadband could further unsettle Telkom, which has pinned some of its growth plans on launching a mobile offering sometime this year. Telkom has seen a steady decrease in the number of voice only fixed-lines, although its data penetration is growing.

Telkom reported flat revenue growth for the year to March, and outgoing CEO Rueben September emphasised the importance of mobile as a strategy to defend and grow its local market share. He said the company was aware of the risks of launching as SA's fourth mobile operator.

Battle lines drawn

Now Vodacom has taken the battle for market share onto Telkom's turf, in a move that could herald the first step towards fibre to the home.

Gary Hart, executive head of Managed Network Services at Vodacom Business, says the company will eventually be fighting Telkom for market share on Telkom's turf, but is currently reliant on the fixed-line operator for use of its last mile.

He explains that the offering will run on Telkom's copper access network for now, but will eventually move onto fibre, cutting Telkom out of the loop. Hart says, however, this will require economies of scale, which will be achieved as more fibre is rolled out to large corporations.

Vodacom has 11 metro Ethernet rings around the country, which it deployed for mobile backhaul. The company is now in the process of linking these rings to each other, and is using the infrastructure, which is already in the ground, to provide the ADSL backbone, explains Hart.

In addition, once the company moves its mobile network onto LTE, an upgrade to the current 3G offering, additional broadband offerings will become available, says Hart.

In future, Vodacom will expand its ADSL offerings to residential areas, although there are currently no specific dates or details available. “The launch of a residential ADSL service would be a logical response to Telkom's entrance into the mobile business,” says Richard Boorman, Vodacom executive head of corporate communications.

Business solution

Vodacom Business launched a premier business ADSL service, offering capped and uncapped offerings with speeds up to 10GB. Hart explains that the offering includes a voice over IP solution (VOIP), and businesses that buy the service are given a Vodacom 087 number.

Customers will also be able to port their landlines over to Vodacom once the company's application to the Independent Communications Authority of SA has been approved. In addition to voice calls and data, Vodacom will offer video services, says Hart.

The capped offering is available in monthly 1GB, 3GB, 5GB and 10GB packages, which are targeted at small and medium or home run businesses with a variety of options. Larger companies are offered uncapped broadband, with speeds of up to 4 096Kbps.

Both the capped and uncapped options come with a choice of being shaped or unshaped and come standard with an ADSL modem and a VOIP-enabled phone, which provides for landline-based IP calls to be made over ADSL, offering up to a 30% cost reduction on fixed-line calls.

Companies also have the option to bundle traditional voice, Internet access and VOIP into a single platform using Vodacom's private branch eXchange solution.

Fail safe

Vodacom Business uses a blend of SAFE, SAT3 and Seacom cables for international connectivity, which ensures built-in, automatic restore functions in the event of a break in any one of these cable systems.

In addition, should a Telkom cable break or be stolen, Vodacom's uncapped solution includes an optional 3G/HSPA failover.

If the line fails, the online business functions will automatically be rerouted on Vodacom's 3G and HSPA network, and put back onto ADSL once the service is restored.

Smart move

Chris Gilmour, Absa Investments analyst, says Vodacom is beating Telkom to the punch by launching ADSL before Telkom can offer businesses a mobile solution bundled with its current services.

“Telkom has been neglecting its own backyard, and other people like Vodacom have come in and are eating their lunch,” says Gilmour. He says Vodacom's strategy is “very clever” and is likely to make inroads into Telkom's most lucrative market, which is the corporate customer.

“At long last, we are starting to see the benefits of enhanced broadband availability. The more entrepreneurial companies like Vodacom are grasping the opportunity with both hands,” adds Gilmour.

Vodacom's ADSL offering;

Capped prices*
1GB at R59 p/m
3GB at R169 p/m
5GB at R279 p/m
10GB at R549 p/m

Uncapped pricing*
384kbps @ R1 132 p/m
512kbps @ R1 588 p/m
4096kbps @ R2 842 p/m

*Excluding ADSL line rental, see Web site for more details

Interconnect Rates and our LCR - where to now?

We are inundated with requests for information and guidelines [from our clients and business partners alike] on what to do about the Interconnect Rates and our LCR. Many of our clients are sitting on the sidelines not making decisions because they don’t know what to do and the resulting loss in savings is punitive.

To make matters worse ICASA announced yesterday 1st Feb 2010, that they are not be accepting the proposal from the GSM networks and Interconnect rates are NOT coming down on the 1st March 2010 anymore [well for today this is the status quo anyway].

So what do you do about LCR in today’s telecoms landscape and how should your business be proceeding. Should your business leverage LCR or adopt a wait and see approach?

Here follows some guidelines on how to approach LCR and or any telecoms infrastructure for that matter –

1. Don’t renew any subscription based contracts for GSM LCR
a. There is no law stating that you cannot run month to month and all LCR service providers will allow you to run month to month
b. Subscription based LCR with a 24 month contract period is definitely not the way to go
i. As a minimum you want your business to be paying for calls made
ii. And you don’t want to be managing bundled minutes / SIM cards

2. The reality is that there is more choice in SA now with the arrival of Neotel and the VANS – meaning that Least Cost Routing of all call type’s – not just GSM – is important when it comes to containing teelcoms costs and probably always will be – especially
a. Regional
b. Inter branch - why carry costs on your MPLS if someone else will do it for R 0.15 and guarantee quality of service
i. Local, National and GSM; all these calls can now be routed cost effectively using LCR

3. Whilst price plays a big role in any RFP or procurement process; price alone cannot dictate your procurement strategy for telecoms. Business need should drive procurement strategy and price should play a role – i.e. what is the least cost route for my traffic taking my unique business need into account.
a. Market forces, Legislation and Quality of service [QoS] will dictate the right price for your unique business need
b. Buy in from all roles players on strategy is advisable
c. Ask your trusted suppliers / advisors what they think and what new “innovative” products they have available to you
d. Business needs change and therefore clarity is NB on –
i. Current Business Needs
ii. Future Business Needs

4. Ensure your commercial agreements with Service Providers provides you with a so called “technology catch fence” which is essentially an “out clause” in the contract stating that if the market moves and the service provider cannot match the service you can “get out of “ the contract -
a. This will give you and your management team the comfort levels you require to move forward knowing that if the markets move you are not tied into a long term contract
b. Most SP’s are currently joined at the hip in one way or another and when the market moves they will all move together / although we could see major changes with the new fiber networks and the competitive nature of SA’s telecoms market in 2010.

5. Whilst price is important so is -
a. Quality of service / voice quality
b. Optimised infrastructure – a “must have”.
i. So many businesses put LCR in place and don’t pay attention to the “overcapacity” issue; resulting in increased fixed monthly costs.
• Pay careful attention to Zero Billing assets
• Watch your concurrent calls analysis per site for the signs of overcapacity
• Reduce telecoms infrastructure requirements where possible
c. Service Level Agreements / response times / maintenance costs / roles and responsibility
d. Service Provider “Support Structures” such as customer service desks and operational support / project management
e. Redundancy of infrastructure / continuity of business – especially mission critical call centers / business processes / operational centers

6. The fact that you cannot squeeze SP’s until they have nothing left and then expect great service in return
a. Rather focus on great value and great service
b. There needs to balance
c. That’s why pricing only receives a 25% weighting in RFP’s we have been involved in

7. Critical business processes like – call centers / business processes / operational centers normally require redundancy
a. Redundancy should never be a price motivated decision
b. Rather savings extracted from telecoms initiatives need to pay for redundancy
i. i.e. more value for at a cheaper cost
c. User experience
i. Bad quality – bad experience for customer and employee alike
ii. Bad for business

8. Infrastructure
a. Optimised infrastructure is a “must have”. So many businesses put LCR in place and don’t pay attention to the “overcapacity” issue; resulting in increased fixed monthly costs.
i. Pay careful attention to Zero Billing assets
ii. Watch your concurrent calls analysis per site for the signs of overcapacity
iii. Reduce telecoms infrastructure requirements where possible
b. Watch the rental costs per line / port
c. “Minimum billing” versus managing “subscriptions bundles” and “rented ports “
i. Passes Risk of zero billing issue over to the SP / no longer your problem
ii. If the Service Provider carries only charges for calls and not to rent the port your business can
• drive down fixed costs
• invest in redundant options
• and save money

Waiting for the market to dictate policy and business need is not a good business practice. As a business one needs to have a plan. And DataRoom can help you formulate that plan. So get us involved in the areas where we can help you formulate a way forward and provide that much needed clarity that will enable you to make an informed decision.

There is no easy answer, but should you wish to maintain savings and or increase savings using LCR, there are no short cuts. You need to do the work before you make the call.

These are our thoughts / guidelines rather than rules and if you have any questions please pick up the phone and call us.

Peter Walsh
Cape Town
Feb 2010

A business case for managing your own voice infrastructure

Successfully managing voice infrastructure in-house is dependent on you having the ability to measure, manage, optimise and report on your voice infrastructure. Furthermore, the approach [read strategy] needs to be well thought out and documented; with objectives, deliverables, roles and responsibilities.

Most of our customers are not focused on this important area at all. It is bypassed in favour of the "low hanging fruit" and typically does not feature on the “to do lists”. All to often we see customers with LCR / VoIP installations and discounted supplier agreements, but no documented strategy on the managing their voice infrastructure.

There are 4 key areas which you should consider when making the decision to address this all important aspect of telecoms management:

1. Continuity / Risk – should key role players leave the organisation and or outsourcing to the current 3rd party no longer be an option; the replacement 3rd party or the replacement employees need to have a point of departure. A detailed point of reference with regard to your specific business needs:

a. Strategy
b. Business case for change
c. Redundancy in mission critical business units
d. Projects underway / projects completed / projects delayed
e. Role players
f. Role and Responsibility
g. Measurable and deliverables

2. Decision making - The vast number of suppliers, products and services in the South African marketplace, combined with your company’s own strategy, makes decision-making a complex process. Fully understanding and addressing your own unique business need is by no means a “quick fix”. Voice infrastructure is an essential component of your business and can be complex. It is important that a documented strategy is completed taking into account the following:

a. Best Practices for voice infrastructure
b. Business need and business processes
c. Accurate reporting on voice infrastructure and call costs
d. Project Plan with
o objectives / timelines
o role players
o roles and responsibility
e. Immediate shortfalls and opportunities
f. Budget

3. Direction – The telecoms market is evolving as breakneck speed, suppliers are hard pressed to keep up and you do not want to invest blindly in technology for technologies sake. In addition multiple site environs over large geographical areas cannot afford to have role players making ill informed decisions on their own. Your business needs to decide on vendor, product and service selection, to deliver on strategy, with focus on:

a. Aggregation of spend
b. Buying power and cost saving opportunities
c. Centralised contact person[s]
d. Current and appropriate technology to address your own unique business need
e. Market related pricing
f. Future business requirements

4. Costs – There are direct and indirect costs when it comes to managing voice infrastructure. The direct costs are supplier related and the indirect costs are driven by resource, skill and knowledge management requirements. Issues such as:

a. Telecoms specific knowledge
b. Understanding your business needs 100%
c. Delivering the right information to the right role player[s] for decision making purposes
d. Managing installations, moves, additions and changes

DataRoom believe we are uniquely positioned to partner with your business. Empowering your management team to make the right decisions through knowledge management, accurate reporting and the DataRoom Best Practices for optimised voice will ensure:

• Successful implementation
• Reduced risk
• Reduced costs
o Savings on direct costs within a short time frame
o Internal resource requirements
• Knowledge management and growth of the requisite skills in-house

Neil Buckley
neil@apexbi.co.za

27th January 2009