Swisscom Delivers Application Layer SLAs with Ipanema

On January 24th Swisscom aanounced that it had selected Ipanema as a partner for WAN optimization technology. The company provides three modules: auditing, deployment and management and used to provide application-centric SLAs to customers. The service is available with the Swisscom LAN-I product. Prices for the service are between ten to 20% of the total monthly recurring charges per site. Dynamic Bandwidth Allocation with the Advanced Compression feature will not be available until Q2 2008.

Recommended Competitive Responses

► Verizon Business could stress that it is taking a more scalable approach, taking audit right down to the desktop but giving customers tools to change application packet marking and bandwidth on demand for Ethernet tail ends. Customer care online portals are beginning to play a key role by providing real-time application monitoring dashboards, enhanced service level management and optimisation (e.g., increase or decrease bandwidth). This is key to providing customers with high levels of transparency into gaining optimal end user performance for their applications.

► Defensively, BT, Orange, Vanco, and Telindus and Orange Business Solutions should stress that they are also working with Ipanema in delivering these solutions in the market. They should also stress, where appropriate, how their respective multi-vendor approaches gives greater value to customers. Orange Business Services, for example, could point out that it uses Packeteer for QoS/prioritization, Juniper for Layer 7 application acceleration and Riverbed for wide-area file systems and compression.

► National competitors such as sunrise and Cablecom should consider launching similar products. This will be important for sunrise in improving its MPLS VPN offering in the national market, and Cablecom in improving its recent offerings to the business segment. COLT Telecom should also consider investing in this area in Switzerland and across Europe. This will help the company climb the value chain to support its customer requirements.

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T-Mobile UK Uses Free WiFi to Set Its Mobile Broadband Apart

On January 9th T-Mobile UK announced that it had integrated ‘free’ WiFi access into its web‘n’walk Plus and Max mobile broadband services, which start at GBP 12.50 per month when connecting with a Flext voice plan. Laptop users utilising their 3G mobile handset as a modem, or customers using WiFi-enabled smartphones, can access 1,200 T-Mobile hotspots in the UK. T-Mobile UK WiFi hotspots typically cost from GBP 5 for 60 minutes, GBP 10 per month for subscription or GBO 20 per month for those without a T-Mobile phone.

Recommended Competitive Responses

► Rival MNOs Vodafone, 02 and Orange should focus on expanding 7.2 Mbps HSDPA coverage to negate customer need for WiFi access at all, and they may need to examine ways to reduce the cost of the WiFi hotspot access they offer to UK business customers through partnerships with providers such as BT Openzone and The Cloud.

► Vodafone UK should ensure its mobile broadband e-mail and Internet access solution remains competitive with T-Mobile Flext + web’n’walk packages by expanding its 7.2 Mbps HSDPA coverage and contrasting its aggressive flat-rate 3G data plans against them.

► Orange Business Services already offers multi-bearer mobile access solutions in its Business Everywhere solution and can counter any threat from T-Mobile to its SME customers by accentuating its integrated fixed and mobile, voice and data offers, including broadband combined with end-point security applications. Orange Business Services can highlight its new mobile data USB modem for Business Everywhere users, which contains the upload for the Business Everywhere dashboard, and its support for multi-bearer access.

► 02 UK should tailor its monthly WLAN access price plan and Connection Manager software to present better value to business customers and put more focus on hooking SMEs with mobile VPN and Web services combined with its professional services expertise.

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TDC Partners with US-based VoIP Carrier iBasis for International Telephony

On January 14th TDC signed a five-year deal with US-based iBasis for international VoIP telephony, reducing some 130 international carrier relationships to just one. TDC will buy all its international traffic outside the Nordic countries through iBasis, a subsidiary of Dutch KPN. Similarly, TDC will be the preferred Nordic provider to iBasis. iBasis will pay TDC $10 million in cash, while the outsourcing deal is expected to generate $80 million in new annual revenue for iBasis.

Analytical Summary

► Current Perspective: Positive on Verizon Business‘ announcement regarding plans to upgrade its pan-European backbone to 40 Gbps using ultra long haul (ULH) technologies, because the new investment, based on Nortel equipment, will enable the carrier to quadruple its backbone capacity to support continual growth in IP and data communications services across major European hubs.

► Vendor Importance: Moderate to Verizon Business, as the company needs to continue to invest in its network infrastructure to support the current and future demands for high-capacity bandwidth from its customers. The injection of 40 Gbps capacity will be important for supporting high-speed Internet access, advancing its carrier Ethernet products, delivering more Web-based applications (especially multimedia and video), and supporting the growing requirements for managed storage.

► Market Impact: Moderate on the European telecoms market, because there is no sharp increase in market demand that matches Verizon Business’ move to quadruple network capacity in select routes. Most customers appear to be content with their existing service offerings. When there is a noticeable shift, competitors are also likely to invest in similar network upgrades.

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