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RealTime IT News

AT&T: IT Networks Not Up to Their Challenges

A survey of information technology executives conducted by The Economist Intelligence Unit has found that more than half of senior executives worldwide believe their existing information technology (IT) networks are not adequate to handle their main business goals over the next two years.

The survey, which was commissioned by AT&T and conducted by the business information arm of The Economist magazine, polled 237 global senior executives across a variety of industries. The report was written by AT&T in cooperation with The Economist Intelligence Unit.

Only 6 percent of the respondents said their networks were fully up to the task of handling all their business challenges by 2005, the survey said. Another 58 percent said their networks, at best, could handle only some of the challenges expected within the next two years.

When asked what top three challenges that their companies' networks need to meet over the next two years, the largest majority, 44 percent, cited the move to open standards that would allow businesses to communicate with customers, employees, suppliers and others across a variety of computing platforms.

Another 44 percent cited the need to "to achieve efficiencies by integrating multiple systems and applications," and 43 percent said the need to handle greater volumes of data traffic was among their top three issues. Thirty four percent said their networks need to cope with more points of access to the network globally.

The executives in the survey, 23 percent of whom described themselves as senior functional managers, said the convergence of voice and data networks into one managed network was a key goal within their organizations.

Other key findings in the report are that executives in the survey said securing networks without compromising application integration or user-friendliness is also a key concern.

And, in a sign that suggests the development of autonomic computing systems is gaining notice with corporate networks, the executives in the survey cited network intelligence -- a network's ability to prioritize different types of data and identify how to re-route traffic when faults crop up -- as a key goal.

The report comes as AT&T continues to invest in upgrading its business networking services to next-generation platforms for customers, such as multiprotocol label switching, or MPLS , which helps network operators divert and route traffic around link failures in a network, and Voice over IP services on one platform.

In a difficult spending environment among corporate IT buyers throughout the past three years, one percentage stood out in the survey: 48 percent of the respondents said they plan "significant or very significant new investments in networking over the next two years."

But there's also a catch, the report continued. "Burned by blue-sky promises during the heat of the tech boom, companies are adopting a more skeptical attitude towards the purported benefits and payback of new solutions, especially when they already have a network in place," which helps explain why outsourcing IT operations, or turning to a managed services provider, has been on the rise in the past few years.

"In the 1990s, hardware and software exploded across organizations, creating a rat's nest of incompatible applications. According to a recent Forrester Research survey of large firms, the average company now spends $6.3m a year on integration of applications, and this figure is increasing as a percentage of IT budgets," the report said.

Survey respondents indicated they wanted more data transmitted at higher speeds to a greater number of access points globally. They also placed a premium on network reliability, security and interoperability. But many companies, the survey found, are finding that traditional networks such as Frame Relay and ATM are not equipped to scale up their networking needs as they move towards greater acceptance of B2B commerce online.

According to the report, the ever-increasing cost and complexity of today's typical corporate networks compel an examination of network design from the ground up.

Thirty percent of the respondents were from Western Europe, 26 percent from North America and 26 percent were from the Asia Pacific region.

Other regions represented were from Eastern Europe, Latin America, the Middle East and Africa. Of all the industry sectors represented in the 237-person survey, the top five represented were business & information technology, software, financial services, manufacturing, and healthcare/pharmaceuticals.