By
Paul Gowans and Todd Biddle
Over the next several years, service providers will be providing customers with much more for much less, at least if revenue is calculated on a per-bit basis. Service providers are rapidly moving to all-IP networks, and IP traffic is expected to explode. Cisco Systems predicts that global IP traffic will exceed 667 exabytes by 2013, due largely to the growing popularity of bandwidth-consuming video, which is projected to rise to 90 percent of IP traffic (Cisco Global IP Traffic Forecast 2006-2011). Yet competitive pressures have driven providers to flat-rate billing, so gamers and the like have every incentive to use as much bandwidth as they want, since they won’t be charged extra. The result: per-bit revenue is bound to decrease.
How can a service provider do so much for so little and still make a substantial profit? Two strategies are obvious, although each is easier said than done: first, you must lower the cost and effort of delivering the bits; and second, you must attract and maintain more customers who supply revenue. In today’s low-return-per-bit environment, market share is king. This brings us to one of the hot topics in modern telecommunications: the value of a converged network infrastructure.
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How can a service provider do so much for so little and still make a substantial profit? |
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only have to worry about one infrastructure, hire and train only one network management team, and purchase only the Operational Support Systems (OSS) built for monitoring and troubleshooting that type of network. A consolidated network infrastructure enables the simplification of monitoring and management, allows for easier and far more cost-effective and efficient network management, end-to-end service assurance and a simpler, more reliable way to deliver high-quality subscriber experience.
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Done Right, Convergence Cuts Costs
A “converged infrastructure” means an infrastructure that enables a single core network to deliver all voice, video, and data services regardless of access method, whether it be high-speed broadband or high-speed mobile—e.g. 3G, DSL, cable, WiMAX™, LTE, etc. Clearly, a carrier can save significantly by consolidating networks, as long as the consolidated network is well built and well managed. Consolidation enables savings on capital expenditures, at least in the long term, because you only need to buy equipment for one network. As for management: although convergence makes a network intrinsically more complex because all IP services go over a single infrastructure, you
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Done Right, Convergence Wins Customers
The savings on CAPEX and OPEX mentioned above suggests two obvious ways that convergence can help a service provider keep and attract customers: you can pass some of those savings along in the form of lower prices, and/or you can use the money to invest in new services. Customers love both.
Yet convergence offers service providers much more than savings; it enables them to make services accessible from anywhere and also makes them more compelling. Since a converged network is agnostic to access methods, customers can access the services
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