By Carol Wilson
Jun 18, 2008 12:00 AM
As business services shift into the IP realm, service providers are looking for new ways to differentiate their service offerings and finding vendors eager to help them. At NXTcomm08, a wide variety of managed service, software as a service and unified communications solutions will be featured on the show floor and in conference discussions.
Increasingly, in fact, services themselves are becoming harder to define and distinguish from the business applications that they support, and service providers are having to become more flexible in how they offer business services and more dynamic in how they sell them. Service providers themselves admit that the move to IP services represents an opportunity to do more for the business customers, but also a challenge to their current business models.
“What IP is enabling as far as voice, data and video communications is a standardized platform that allows services to be linked together and be linked in a more integrated part of the business process,” said Eric Bozich, executive vice president of product management for Qwest Communications. “Instead of being appendages that live in stovepipes — wireline, wireless, TDM and IP — all supporting models and different feature sets and different facilities, IP creates an environment through which these things can be unified.”
Simply providing high-quality services and guaranteed service level agreements are now taken for granted as a fundamental part of business services, said both Bozich and Nancy Gofus, senior vice president and chief marketing officer for Verizon Business. Customers are expecting their service providers to help them decide the most effective way to deploy specific applications.
“Some applications might best fit in our premium data centers and not at the customer [premises],” Gofus said. “We can deliver them in a computing on demand or software as a service model.”
In fact, Cisco research shows that while enterprises were very concerned about service reliability back in 2003, it has dropped to the bottom of the list today, said Al Safarikas, senior director of managed services marketing for Cisco.
“In 2003, two-thirds were saying network reliability was a major issue, and it has fallen to well below a third today,” Safarikas said. “That’s a huge change. The No. 1 concern today is supporting business initiatives, which shows they are now looking at a managed services provider as a partner.”
Business customers are asking their managed service provider partners to deliver IT functionality as a service to advance those business initiatives, Safarikas said, adding “that is an enormous shift in four years.”
Delivering applications is a fundamental part of Cbeyond’s strategy, and the CLEC now has more than 30 different apps that it sells, said Brent Cobb, vice president of product management and general manager of the mobile business. The average number of applications Cbeyond sells individual customers is now up to 6.3, Cobb said, and those include things such as virtual private networks, fax to e-mail conversion, Web hosting, data backup and even desktop apps.
For the past year, XO Communications has been delivering business applications in a partnership with Jamcracker, offering BlackBerry hosted services, Microsoft Exchange e-mail and SharePoint collaboration server, as well as McAfee Total Protection security for small businesses and Arsenal Digital Solutions online desktop backup services.
Getting deeper into the applications side of business has forced telecom service providers to work together with the IT side of the house in new ways.
“You have to be able to link the services you are selling to the IT and business challenge,” said Michael Rothschild, solutions manager in managed services for Juniper Networks, which will be exhibiting technology deployed as business solutions at NXTcomm08. “The idea is to create, instead of a commoditized service, a solution set. For example, instead of saying managed firewall, sell a threat management type of solution that combines firewalls, intrusion protection, secure access and the [security information management] type of functionality that brings all these together.”
Increasingly, business customers want “to communications-enable their applications and IT services,” said Alex Danyluk, industry director of global telecom business, for Microsoft’s communications sector. “Whenever they are in any business application, the need to communicate with people is increasing at an ever faster pace. The desktop software needs to be able to provide that and integrate with service providers.”
Danyluk said that service providers are moving from operating networks, to making those networks applications-aware, to understanding how applications run on networks, to now delivering applications on top of an applications-aware network down to the desktop.
“It will be a combination of software and service, rather than just [software as a service] or just software,” he said. “It’s a more powerful combination of being able to deliver powerful software at the desktop that works with powerful services in the network.”
For example, the same Microsoft Outlook that many people use for e-mail can also work as a hosted e-mail service within the network, and it can be integrated with SharePoint for network document storage in conjunction with offline contacts, appearing within Outlook as a folder, Danyluk said. Customer relationship management software also can be integrated within Outlook, making the software program “a rich desktop interaction tool to a set of hosted services,” he said.
Qwest is focusing on managed messaging applications that tie together SharePoint, Microsoft Exchange e-mail servers, and voice-over-IP (VoIP) and voicemail systems, Bozich said. “We are concentrating first on a one-mailbox kind of experience,” he said, “but we know we need to be able to plug in other kinds of business applications that enable this managed service provider environment we have created.”
To do that, Qwest is looking at a broader array of business partners than before, Bozich added, and the on-premises network is increasingly part of what Qwest will manage as it becomes part of the IP ecosystem. “You have to extend your perspective beyond the traditional telco demark and the wiring closet,” he said. Now, when Qwest field engineers go to a customer site, they show up “with tools preloaded onto a laptop, and they can walk in and plug that laptop into the network, and it will go through the process of discovery to find everything on the network. It will identify and test VoIP traffic and identify places where there is a design issue or a switch or router upgrade is necessary to support the quality of service required,” Bozick said. “We do that now as a matter of course.”
New technology such as telepresence represent a major opportunity for managed service providers to combine delivery of high bandwidth with management of potentially complex piece parts. Both AT&T and BT have announced plans with Cisco to offer its Cisco TelePresence capabilities as a managed service that will enable inter-business video connections within the network, making the service more valuable to all, Safarikas said.
Sometimes, the solution a service provider can offer is the ability to make better use of technology that has been or is being deployed. With VoIP, for instance, there is now more capability in session initiation protocol phones that can be leveraged by smarter services, if service providers can enable their customers to put all that intelligence to use, said Martin Taylor, vice president of product management and technology strategy for MetaSwitch, which makes softswitches and now applications platforms for business VoIP services.
“Customers can remotely program their phones to follow a particular set of rules when they are out of the office,” he said. “You may want to send certain calls to voicemail, others to a cell phone. People have the need to deal with business calls from multiple handsets, and this is a powerful tool to let them do that.”
PCs and phones also are being integrated to do more with contact lists, including searching lists and doing a quick click-to-dial instead of keying in numbers, Taylor said. One of the challenges to the service provider wanting to deliver all of this functionality is making it easy for end users to adopt, he added. One of the things MetaSwitch is doing along those lines is a special toolbar, launched in March and on display at NXTcomm08.
“The CommAssistance toolbar will install on the PC and sits on the Windows taskbar,” Taylor said. “It has a search box and will search for contacts, so the customer can click on the match and have the option to dial that person’s number.”
Security is an area in which service providers are developing managed services and are seeking to deliver a broader service. Verizon Business has invested heavily in this area, buying CyberTrust and, when it was operating as MCI, NetSec. According to Gofus, Verizon Business wants to operate at the application level, providing a full range of security products that not only proactively protects its customers from threats that originate within the network, but also help enterprises understand “how secure your applications are, what are your vulnerabilities, what you should put in place and what kind of forensics support is required,” she said.
One area in which Cbeyond is seeing its most significant growth is in mobile services. The company began offering mobile services in 2006, and by last year, 24% of its customers were buying some kind of mobile service, Cobb said. Cbeyond operates as a mobile virtual network operator, buying minutes and megabytes in bulk and reselling them to its small business customers, along with a full set of handsets targeting small businesses.
Verizon Business would like to offer more wireline/wireless integration and is making progress in that direction, but it is still in the early days, Gofus said. This summer, Verizon business will start doing EV-DO access into its private IP service, and it has already created a single portal, Verizon Enterprise Center, where customers can do both their wireless and wireline business. Managed mobility looms ahead as the next great opportunity, along with security, Gofus said.
Qwest, which just announced a sales partnership with Verizon Wireless, also anticipates blending wireless and wireline services for its customers, Bozich said.
“Customers are somewhat frustrated with the fact that wireline and wireless are different worlds, different stovepipes,” he said. “That’s an opportunity that we see in the marketplace to bring those things together and create seamlessness, adding mobility into fixed location services that we make our living providing today.”