There's no question that wildly escalating demands for data communications connectivity and gluttonous bandwidth appetites are a boon for carriers of all stripes. And with their wily marketers and nimble service provisioning teams, competitive local exchange carriers (CLECs) and nonincumbent integrated communications providers seem especially well-positioned to pounce on the data opportunity.
But, as most in the industry know, providing all-you-can-eat Internet service for $19.95 is not the path to riches. Instead, carriers need to provide businesses with Internet protocol (IP) services that are less smorgasbord and more serve-to-order as mission-critical business applications and delay-sensitive traffic such as voice move to IP networks.
A variety of new technologies and processes are coming available that promise to allow carriers to dish up bandwidth, latency limitations and other performance parameters to suit the palettes of a variety of customers and applications.
Competitors need to start investigating and installing these tools now so they are first to market not just with virtual circuits--which typically provide business customers with raw bandwidth between two predetermined locations over a shared carrier infrastructure--but with services. That means the ability to provide customers with bandwidth as well as network performance (such as latency ceilings and bit-loss ceilings) on demand between any two points, on demand based on the needs of the application or on demand based on the needs of a particular user.
Technology leaders envision a day when servers holding policies on particular users or applications will sit on both public and private networks to provide policy parameters to the routers and switches as needed--a concept known as the "directory-enabled network."
The days of differentiation based on pricing are quickly coming to a close. As I once heard author/marketing guru Jack Trout say, a strategy based on low pricing alone isn't a long-term strategy because "the competition has a pencil, too."
And that's what basic transport is destined ultimately to be--a least-cost game. Services are the key to long-term success for the carriers. And the time to invest is now.
Until next time,
Paula Bernier
Editor-in-Chief
