Professional Services Providers In Demand

The coming year could turn out to be a prosperous one for service providers (commonly referred to as xSPs), according to a report by Gartner Dataquest Inc., a unit of research and advisory firm Gartner Inc. .

The report titled: ‘xSP Network Services: Are you xSPerienced?’ which presents survey results from 61 North American services providers including xSP participants from various sectors, found that 66 percent of participating companies are using, or plan to use external professional services vendors to help them bring new products to market, over the next year.

Says Eric Goodness, principal analyst for Gartner Dataquest’s IT services worldwide group, despite public announcements from many businesses on curbing expenditures, after years of lavish investment in public network and Internet infrastructure; “These same carriers will increasingly look to external professional services companies to help them develop, support and manage their core infrastructure to aid them in bringing new services products to market,” he argues.

He says the predominant focus for xSPs, has been on communications and infrastructure services, such as telecommunications, network service providers (NSPs) and Internet service providers (ISPs). However, it is believed that the emergence of application service providers (ASPs) has extended the xSP model into a higher level of the customer value chain by directly addressing business and consumer interests, such as business process and function sourcing.

“The xSP acronym is a representation of a larger market space that refers to a wide-ranging category of service providers, of which ASPs are just a small element,” explains Goodness.

He says that, in addition to applications, many other support services and IT capabilities are offered over the Internet as ‘sourced services’. XSPs offer access to these services and applications using a service fee-based business model, “because of features such as monitoring, active administration and automation from an external, shared environment” he says.

The survey says that network consulting and business planning look to be the hottest growth property on the professional services map as service providers are increasingly looking to provide added value to customers with the expertise needed to identify target markets, determine optimal architectures and build operations and billing support systems.

“Historically, telecommunications organizations relied primarily on internal staffing to effect changes to the core network or to create new services products,” says Goodness. “Use of third-party professional services vendors is often relegated to installation activities as part of network build-outs,” he explains.

The survey says the increased numbers of competitive operators, such as mobile, satellite, and competitive local exchange carriers (CLECs), and emerging xSP models have changed the way most operators consider using third-party organizations. And external services vendors can ultimately benefit these operators by offer access to additional expertise helping to reduce operating expenses.

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