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05/14/2008
More Service Providers Look to Outsource Parts of Their Own Networks
Many service providers today are marketing managed services as a way for their business customers to free themselves from the upfront and ongoing costs of equipping and running their own networks. At the same time, many carriers themselves are moving to outsource parts of their own network operations. The argument for outsourcing in both cases has to do with cost savings and the ability to offload non-core operations so they can focus what they’re really good at – or at least on what they think can make them the most money. In fact, just this week, India-basedtelecom giant Reliance Communications and Alcatel-Lucent formed a global joint venture to offer outsourced managed network services to telcos, with an initial focus on CDMA and GSM network operators. Several of the exhibitors I met with at the recent Billing & OSS World Conference & Expo in Chicago talked about this growing trend in the communications service provider space. In fact, one gentleman I spoke with, Gautam Saha, vice president-BPO at HCL America Inc., said he expects some of North America’s largest telcos and cablecos to outsource BSS/OSS operations in the next 12 to 16 months. Outsourcing these operations, he said, can free up service providers to put more investment and time into better creating and marketing their services, he said. “I think companies are looking to outsource more and more,” said Patrick Murtha, vice president and general manager of network operations at Harris Stratex, which sells the popular line of NetBoss and NetBoss XT network management software. He added that Harris Stratex is exploring adding more managed network operations center (NOC) services to its portfolio and that it already has responded to several requests for proposals (RFPs) from service providers who are looking to outsource. CustomCall Data Systems, which sells billing, OSS and business process management solutions to service providers of all stripes, was early to recognize the outsourcing trend and has for some time delivered a hosted billing solution, its core offer. Brian Hall, a marketing management at the company, said many of its customers are CLECs. While it might seem that outsourcing back office operations would be most appealing to small or medium service providers, or other businesses, with relatively small budgets and IT staff, xchange’s sources indicate that several large carriers also are considering or going this route. For example, Murtha said a GSM operator in the Middle East that has several million subscribers is looking at the outsourcing option.
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05/07/2008
WiMAX Opens at the ‘Googleplex’
As I’m sure you already have heard, the blockbuster news of the day is that Bright House Networks, Clearwire Corp., Comcast Corp., Google, Intel Corp., Sprint-Nextel Corp. and Time Warner Cable Inc. have formed a $14.5 billion broadband wireless joint venture. Of course, this deal marks a return of the Clearwire and Sprint-Nextel pairing, as well as Sprint’s second go at partnering with the cablecos around wireless. But, considering the forward-looking broadband wireless focus of this venture and the fact that Google and Intel are now part of the mix, this effort is far wider-ranging and looks much more promising than the earlier, failed combinations, particularly the Sprint/cableco one. The deal gives Clearwire, founded by cellular pioneer Craig McCaw, the footprint it needs to be a serious player and puts its CEO Ben Wolff at the helm of the new effort. It gives Sprint, a long-time telecom player which has been a visionary in terms of broadband wireless but also needs serious help, some hope for the future. And it gives the involved cablecos, which have been looking for a path to higher-speed broadband and converged services, a significant play on the wireless front. Meanwhile, Google gets plumb positioning for its search, advertising and Android operating system software in what is expected to be the nation’s first WiMAX network. For Intel, this is yet another effort to help forward another technology that will fuel demand for its chips. Putting together this combination reportedly took a lot of time, blood, sweat and tears. But, clearly, as a whole, this is an impressive slate of players all with a clear reason for participating and investing in the venture. However, successfully building a new network based on new technology and successfully marketing services based on it in competition with the telcos, who are already in the midst of building broadband wireless and wireline networks and their own converged services, will be no small feat. But having Google and Intel firmly entrenched in their camp would seem to give this reworked wireless/cableco pairing a strong advantage.
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04/24/2008
Former Telco Employee Confirms Union Restrictions on Layer 3
I hope all my readers out in the blogosphere (are we still using that term?) aren’t tired of hearing my conspiracy theories about the link between telco union worker contracts and PBT, because here I go again. You may recall that last week I blogged about how a source at Telco Systems told me one of the driving factors of PBT – which from a network management standpoint looks like legacy SONET/SDH – is likely telco contracts with union workers that stipulate those employees can’t work on certain technologies. In that piece, I noted that both BT and Verizon denied this was the case; the Communications Workers of America (CWA) failed to return my calls on the matter; and that Nortel hadn’t heard this angle to the issue. This week Greg Gum, vice president marketing and business development at ANDA Networks and a former US WEST and Qwest guy, told me that while he’s uncertain about wording in contracts union workers have with the large telcos today, there was such wording in union contracts in the not-to-distant past. “I don’t know what the union contracts read today because it’s been now five or six years since I’ve been involved in CWA,” said Gum. “But I do recall that there were specific restrictions, depending upon which union you’re working with, and CWA was one of them, and there was some restriction on their ability to work with higher – Layer 3 and above – types of gear. Yup. And anything that gets protocol conversion was considered an IP-based service, therefore if it was doing Layer 3 or above protocol conversion that was basically under the guise of the old information services provider act.” Gum continued: “Most of the contracts, and I was privy to this five or six years ago when we were acquired by Qwest, there was fair amount of negotiation that went on with the unions to apply a different level of let’s say job or skill level, functional level, so folks would do those types of IP-based services because obviously the Internet was changing the network and we had to modify our schemas ...” While Gum, who said ANDA Networks is a PBT supporter, said he hasn’t heard any discussion about potential union restrictions being a driver for PBT, he added: “Obviously, [companies like BT and Verizon are] under cost control, so they’re going to look at the most economical way to do it.”
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