New Edge Networks Launches MPLS CoS Support for ADSL, Delivering on High Expectations

| Apr 14, 2008 | Business Network Services - U.S. | Competitive Update

| Analyst: Brian Washburn

Current Perspective: Very Positive
Vendor Importance: High
Market Impact: High

Event Summary

April 14, 2008 -- New Edge Networks has introduced commercial business ADSL service that supports up to five MPLS class of service (CoS) tiers. New Edge Networks offers MPLS-based IP VPNs, including MPLS CoS support via ADSL, on a nationwide basis both directly and through ADSL partners that cover most places where the broadband service is available. The carrier prices broadband CoS support with a $100 monthly premium relative to the cost of its private network ADSL service, which averages about $140 per month, per location. Other features include an improved 18-hour MTTR and a Cisco router upgrade.

Analytical Summary

• Current Perspective: Very positive on New Edge Networks’ launch of MPLS with five class of service (CoS) tiers across its national DSL broadband footprint, because the provider extends a business-worthy service at half the cost of a T1 leased-line equivalent that reaches about 90% of business locations nationwide. Though other broadband providers have added QoS tools to broadband, usually to support VoIP, New Edge’s offer of five CoS tiers taps a solid business opportunity and opens the door to a potentially vast array of wholesale partnerships.

• Vendor Importance: High to New Edge Networks, because broadband access is the carrier's traditional specialty. New Edge deployed a core IP/MPLS fabric, and in August 2006, it added support for five CoS tiers on its new infrastructure. Now that it adds CoS support to ADSL broadband, New Edge Networks marries its two principal areas of focus: ADSL broadband for access and MPLS-based IP VPNs for networking.

• Market Impact: High on the business broadband market, specifically competitors targeting enterprise customers, because New Edge Networks employs MPLS CoS in place of QoS practices that some of its peers and competitors have developed to deliver priority applications; these competitors using QoS-capable broadband tend to focus on VoIP/Internet bundles. New Edge's MPLS CoS package could support VoIP, but it also offers secure managed networking and it supports prioritized data transactions, which is of interest to both enterprises and potentially wholesale partners.

Recommended Competitor Actions

• All competitors can still cast some doubt on New Edge Networks' coupling of IP/MPLS CoS with ADSL. They can describe the PoP-to-premises world of broadband access as lacking the regimen of leased lines. Though New Edge Networks extended its leased line MPLS CoS service levels to its ADSL services, it is still possible to try to inject doubts as to whether New Edge can actually deliver network metrics of the same quality as leased lines.

• Carriers selling IP/MPLS-based VPN services should check in with New Edge Networks on terms for wholesaling its MPLS with CoS over ADSL service. Though the technology comes from a competitor, New Edge is an independent provider that has a wholesale-friendly history, and its service could help challenge the broadband business voice/Internet bundles from the cable providers. Prospective partners should keep an eye on the technology to make sure it continues to deliver to New Edge Networks' specifications as commercial deployment spreads.

• Carriers selling IP/MPLS-based VPN services supporting CoS over private leased circuits can still point to the four-hour MTTR that is the standard for these services, in contrast to the 18-hour MTTR for New Edge Networks' ADSL-based service. They can claim that any connection that needs CoS by definition is carrying traffic vital to the business, and that 14 hours' MTTR difference can translate into very real lost revenues from service outages.

• Verizon Business and AT&T should investigate partnering with New Edge Networks. Meanwhile, they can claim that they already support type of service (ToS) marking for their Internet access/CPE-based IP VPN services: AT&T with its MIS/GMIS (managed Internet service) and Verizon Business with its IP VPN Broadband service. They can claim that this ToS marking is comparable to the CoS marking for New Edge Networks’ DSL, only they will not add performance SLAs unless absolutely sure they are ironclad.

• Broadband specialists offering QoS-enabled applications (e.g., Covad, MegaPath, and Hughes Network Systems) can claim that they have been delivering their forms of service delivery for much longer than New Edge Networks. Covad and MegaPath can say that their voice/Internet bundles are targeted at a different audience, and at lower price points, than New Edge; Hughes can differentiate itself on its end-to-end traffic management inclusive of both terrestrial and satellite communications.

CLIENTS ONLY

Competitive Positives and Concerns

Recommended Vendor Actions

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