Carriers Push Services Front and Center
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Sprint and Verizon Wireless are pushing out new business services aimed at helping enterprises manage both wide area networks (WANs) and wireless local area networks (WLANs).
Sprint's (NYSE: S) free Compass service lets network admins check IP and Multi Protocol Label Switching (MPLS) network performance to gain better insight on network traffic issues as well as operational status, router configuration and network inventory. Verizon Wireless' Managed Wireless LAN (MWLAN) offering, deployed initially for Aruba network configurations, now can be implemented on Cisco networks.
The new network services are evidence that carriers are not only busy wooing mobile device users to boost revenue streams but corporate network environments as well as competition grows in the industry.
"This is the whole other side of the coin for carriers and it's a growing area as enterprise networks are huge factors in mobility, and services are becoming key to growing that mobility," Jeff Kagan, a telcom analyst, told InternetNews.com.
The services push comes as carriers aim to expand revenues streams away from handset sales and rate plans given the increasing pressure to reduce user price points. Expanding services, said Kagan, can become a differentiator in terms of network carrier choice given the increasing headaches networks are imposing on IT.
Telecom managed services aren't new, but offerings have primarily been just the basics for the past decade, explained Kagan. In delivering improved network monitoring, and expanding on platform capabilities, the carriers are trying to stake new market ground.
"Revenue is not all about handsets. All these extra services is where e the growth is," said Kagan.
The wireless LAN market is predicted to grow six percent this year, reaching $3.3 billion by 2012, according to an IDC report last May.
Market leader Verizon Wireless, which initially debuted wireless LANs in 2006 with its Aruba Networks-based MWLAN service, said services are gaining greater traction as enterprises begin realizing the benefits of wireless technologies.
"The retail industry wants the flexibility wireless gives with inventory tasks and even store design," said Chip Freund, director of product marketing for managed services at Verizon Wireless, told InternetNews.com. He also cited healthcare and distributed manufacturing as key segments where wireless is grabbing more attention.
"Everyone has done something with wireless at this point but much is hodgepodge and the need for management is getting stronger," said Freund.
In handing off network management enterprises can gain stronger security mechanisms, oversight and service level advancements, though it all comes at a price. Verizon Wireless said its pricing model is tied to number of LAN controllers, switches and access points.
"We're also seeing a continued push as companies want more flexibility in where to offer wireless, such as desks at remote locations," said Freund.
According to Verizon, its MSP business manages 260,000-plus security, network and hosting devices across more than 4,000 customer networks in 142 countries and territories.
Sprint's new online self-service Compass tool, provides insight on the carrier's network activity that customers never had before, according to Steve Parrott, senior manager, managed services, told InternetNews.com
"Wireless has changed the game with network and the traditional WAN environment," said Parrott. "It's more than just having handsets and as customers move to advanced environments that network integration needs greater management," he said.
As of the second quarter of 2008, Sprint, currently the third-place market player, outpaced the market with a 42 percent year-over-year growth in IP services, or three to four times the U.S. market rate growth in IP services, according to the carrier.
"The new service provides greater trust in the our services and a better understanding of how our network works," said Parrott. "This is a window into the network and at Sprint we believe that what we sell is what the customer should experience."