BT Markets Onevoice to Global Enterprises

On March 15th BT officially launched Onevoice, a global voice VPN service that blends an MNC’s hybrid TDM and IP voice estate and offers a common dial plan and cost-savings on outbound calling. The converged IP VPN service is offered on-net in 54 countries and can provide outbound calling to over 240 countries. Later in 2007, BT plans to integrate access to its global audio-conferencing service as well as mobile access, which will give mobile users the option to run international and roaming calls over BT’s network.

Recommended Competitor Actions

► Competitors should take a look at BT’s marketing of Onevoice; even the product name can become a brand, just as BT Infonet has achieved with MobileXpress. In a service industry where differentiation is so difficult to achieve, competitors should look at changing the generic names they give services (e.g., Voice VPN, VPN VoIP), which are heavy in technology jargon and do nothing to convey the business value of the service.

► Competitors will also need a response to BT’s Onevoice Mobile Access even though it has not launched yet. BT is making enterprise mobility a key part of its portfolio, since MNCs have ongoing concerns about high mobile costs and international roaming charges, and global managed service providers will need to make mobility a key element of their global VoIP portfolios.

► Orange Business Services can safely say that the company was one of the early movers in the global VoIP market. Orange Business Services can also claim that is Business Talk service, which manages TDM and IP traffic as a single network for customers, has the most extensive global VoIP coverage for MNCs, with coverage in 97 countries for on-net traffic and 220 countries for off-net traffic.

► AT&T can highlight that it has been offering its EVPN VoIP service in 59 countries globally for on-net traffic as well as coverage to 220 countries for off-net traffic. AT&T also supports PBX equipment from five suppliers: Cisco, Nortel, Avaya, Alcatel-Lucent and Siemens. This is a major point of differentiation between AT&T and its competitors in Europe, which are supporting fewer vendors.

► Verizon Business can promote that its Global Voice VPN service links a customer’s worldwide sites in 98 countries. Verizon Business should also highlight its expanding SIP-based VoIP platform, which will deliver attractive new services in areas such as collaboration, unified messaging and presence.

► Global Crossing can offer On-Net Plus with VoIP Community Peering, which also provides usage-free VoIP calling to all Global Crossing VoIP users whether within or outside a customer’s corporate dialling plan. Global Crossing can also emphasise that it already offers integrated access to audio conferencing as an on-net VoIP-based solution.

Recommended End User / Customer Actions

► Enterprises should consider BT Onevoice, especially if they already buy voice and/or IP VPN services from BT and BT’s service footprint more or less matches the enterprise site locations. Customers should get more details on SLAs and pricing and an updated list of PBX vendors that BT has tested for interoperability and can support as part of the service.

T-Systems Wins Big in UK

On February 27th T-Systems signed a ten-year IT outsourcing contract with Centrica plc. T-Systems assumes responsibility for part of Centrica’s IT infrastructure, including data centre operations and desktop support services for more than 23,000 users. As part of this deal, T-Systems has acquired two data centres and over 230 positions have been transferred to T-Systems from Centrica plc.

Recommended Competitor Actions

► Major competitors in the UK market should immediately draw attention to the fact that T-Systems does not have a national network. They should show this as a shortcoming to providing networked IT services. They may also consider drawing attention to the fact that it does not have any in-country capabilities outside Germany, Austria and Hungary.

► Service providers in the UK (e.g., BT, Cable & Wireless, Verizon Business) should review potential product gaps with T-Systems and address ways to plug potential holes. They might consider offering customers desktop management services, supported by SLAs, per-seat pricing and online management capabilities that are all fully standardised. They should also evaluate the trade-off between partnering or developing skills in-house.

► Major UK-based system integrators, such as IBM, HP and CSC, should be concerned about the advances T-Systems is making within managed desktop services. They should also be aware that T-Systems has a well-developed utility computing model to drive cost-savings to its existing customers. It also supports one of the largest SAP deployments, supporting over 500,000 users worldwide.

TSIC Takes the Plunge into 160 Gbps Trans-Atlantic Capacity Expansion

On March 15th TeliaSonera International Carrier (TSIC) announced that it had secured terms to handle increased transatlantic traffic by adding a minimum of 160 Gbits (16x10 Gbits) capacity over the next three years. TSIC has seen a high demand for capacity based on a rapid growth in the demand for IP-transit as well as online gaming and media services.

Recommended Competitor Actions

► US operators (AT&T, Verizon, Global Crossing and Level 3) all have significant and expanding trans-Atlantic capacity and are finding core customers on the strength of their 10 GigE capabilities (such as Level 3 signing MySpace and YouTube as customers). However, relatively little has been done by US operators in the mobile backhaul business, which is set to expand quickly as 3G services with multimedia capabilities win mind and market shares. Better backhaul services could counter a stronger TSIC presence in North America.

► Belgacom ICS should consider expanding its non-voice services share, notably in the on-line gaming and video markets. However, using Global Crossing as its partner for trans-Atlantic traffic relegates North American traffic to a secondary position for Belgacom ICS, which needs a more compelling trans-Atlantic solution if it is to capture significant new multimedia traffic opportunities.

► BT Wholesale has significant managed services provider customers requiring networking services that can facilitate data replication between data centres – also across the Atlantic. BT can tout its resilience, but needs to provide stronger Ethernet services to minimise the network configuration needed between the end user site and the managed service provider’s own PoPs.

► France Telecom ICSS’ first and foremost mission is to meet the needs of other parts of the France Telecom group, so there is less urgency here to compete on Trans-Atlantic product offerings outside of Orange Business Services’ requirements. With the established cooperation between TeliaSonera and Orange Business Services, there may even be a business opportunity to partner with TSIC on the North American market.

► While TI Sparkle and Telefonica IWS both compete with TSIC in Europe and both have significant operations in Latin America, they have next to nothing in North America. Here TSIC could actually be an alliance partner with its Viking network to provide a stronger competitive response to the BT, AT&T and Verizon wholesale operations.

Orange Business Services Accelerates Business Applications

On February 27th Orange Business Services launched a suite of services called ‘Business Acceleration’ focused on application-centric networking and designed to manage, audit and optimize application performance. Business Acceleration is a consulting and managed service designed to provide a predictive end-user experience, which includes the optimization and consolidation of the infrastructure as well as the enhanced visibility, throughput and performance of the applications that run on that infrastructure.

Recommended Competitor Actions

► BT can point out that it has 200 pre-sales and delivery specialists supporting its AAI service, which was launched well ahead of Orange Business Services. BT is pretty much in the same boat as Orange Business Services with regard to application level SLAs, but BT should continue to develop AAI to maintain product leadership.

► AT&T’s Application Infrastructure Management service provides continuous network management, network-based and LAN-based, across multiple providers and technologies, in addition to network audits. However, AT&T needs to take a more proactive approach and offer application performance-driven optimisation and dynamic bandwidth allocation in order to match BT’s consultancy services with a team of global professional services staff.

► Verizon Business has made progress with its vision of application-aware networking (AAN) services in which the network dynamically adjusts bandwidth, classes of service and performance characteristics according to the specific application performance requirements. Verizon Business needs to focus more on application optimisation rather than reporting on performance and move ahead with plans to offer the dynamic bandwidth allocation internationally.

► Vanco can promote that it offers application performance optimisation to its MPLS IP VPN global customers. Vanco also uses Ipanema technology, but can offer this upgrade at a very competitive price. Rather than charging customers for consulting, Vanco is taking a self-service approach and positioning application-aware VPN services as the next-generation of MPLS IP VPN services for customers that want application-centric network management and optimisation features.

Recommended End User/Customer Responses

► Migrating from in-house to managed or outsourced telecom services is a business decision. Once the decision is made and in-house comms skills diminish, the reliance on the operator’s professional services and ability to deliver on the roadmap becomes very important. Operators are addressing this with their application performance focus. Customers should view the operator not just as a service provider but more of a business partnership.

► Customers should ensure that carriers understand the business critical applications that must be supported, and should only transition desktop, LAN and data centre operations when performance capabilities are demonstrated convincingly.