Blinded by the Light? Engineering your network for business success without breaking the bank

business success

In the digitally re-mastered economy, the demand for network speed, capacity and resilience is heading in only one direction: faster, higher, stronger. Building a corporate IT network can often feel like engineering the M25…by the time you’ve constructed another lane, the additional traffic has already outstripped the increased capacity.

For businesses with a large footprint of distributed locations, for example in the retail and financial services sectors, the need to keep pace with demand is compounded by the challenges of implementing such a large-scale network. Never-ending timescales which, by comparison, make the Apollo Moon Landings look like they were planned over a long weekend and prohibitive costs that can have your CFO hankering for the days of the carrier pigeon.

Light at the end of the tunnel

Fortunately, there is a light at the end of the tunnel (quite literally) in the form of high-speed, low-cost fibre optic broadband, often referred to as superfast broadband. From a financial viewpoint, superfast broadband is a game-changer. Over a typical five-year term, a site with fibre broadband will cost circa £10,000-£20,000 less than an equivalent business-grade fibre solution such as Ethernet leased lines. Take that saving and multiply it by 100 locations and you have a compelling business case. Multiply it by 1,000 locations and, well, you can do the maths!

It might come as a surprise to find one of the areas leading the way on superfast adoption is the public sector. However, when you combine the need to tightly control the public purse, with the fact that local authorities fall into the profile of organisations with large distributed site networks, then it’s perhaps more obvious.

What may be less widely known is that local authorities have been directly involved in funding and managing the rollout of superfast broadband over the past few years through the Broadband Delivery UK (BDUK) programme. BDUK has been funded through a combination of government and private sector investment, with match funding and governance input at a Local Authority level. Unsurprisingly, having been directly involved in the delivery of superfast broadband, many local authorities have been keen to look at opportunities to realise significant savings on their IT bills by exploiting the availability of the services they have funded.

With superfast broadband coverage across the UK targeted to reach 95% by the end of 2017 (more about this later), the scene is set for businesses with large distributed networks to reap the benefits of low cost, high speed broadband, so long as they avoid the key pitfalls when planning the transition.

The data black hole

Arguably, the principal factor in ensuring businesses maximise the benefits of superfast broadband is having a good grasp of your data. It’s surprising how often organisations lack even the basics – such as a comprehensive list of their locations. This can present a serious barrier to planning a network transition, often resulting in faulty feasibility, scoping and pricing. Taking the time to collate and validate the data related to your organisation’s sites will reap significant benefits in the long term; the old proverb “measure twice, cut once” could not be truer in this instance.

When it comes to large scale network deployments, the key factor is geography, but the most useful data is not actually your site address details – although they’ll certainly be required when ordering network connections. A far more accurate way of establishing both the availability and potential performance of fibre broadband services is often found in the details of any existing voice or data services currently provided to your sites. The challenge is usually collating this data, as it is typically poorly managed and recorded.

Relying on address data alone can create a margin of error of around 20-25% in any feasibility checks. Given that network rental charges can account for more than 50% of the total contract value on a typical telecommunications procurement, incorrect feasibility results can significantly distort your programme budget and cost of ownership; it may even skew the decision making process at the supplier selection stage.

Shall we dance? (Selecting a delivery partner)

Before even setting out on a network tender, it is worth taking stock of the UK superfast broadband market to ensure you not only contract the best value delivery partner for your business, but also to determine how you contract with your chosen supplier.

Suppliers in the network marketplace are often constrained both technically and commercially in terms of which communications providers’ products they can offer. This can limit the extent of your superfast broadband footprint even in areas where the service is available. For example, Virgin Media have the 2nd largest superfast broadband footprint in the UK at just under 50%. They operate a “vertically integrated” model whereby they do not sell their products at a wholesale level to other providers. So, if you want Virgin Media superfast broadband you’ll need to deal with them directly.

In a similar vein, many suppliers do not currently re-sell the full portfolio of BT Openreach (91% UK coverage) superfast products, such as Fibre-to-the-Premises. However, this may change soon with published plans to make this product available to around two million premises, with an emphasis on business locations.

Faced with these constraints, some organisations have chosen to contract on a service-integrator-based model. Here the chosen supplier, not even necessarily a telecommunications specialist, is selected to procure and integrate the best value network services in a region, irrespective of the communications providers involved. This approach does, however, create some challenges which need to be carefully considered in relation to the technical and service integration model.

Light speed ahead

For businesses with large corporate networks, it is critical to ensure your network contract and transition programme are future-proofed and flexible to react to changes in the ever-evolving superfast broadband marketplace. As an example, if a business location cannot currently receive a fibre broadband service, does your contract allow you to swap out a more expensive leased line service for superfast broadband when it does become available?

It’s also worth ensuring that the feasibility status of your sites is re-checked throughout the transition process. Thousands of additional premises are being connected for superfast fibre every month in the UK as the main telecommunications providers have their own ongoing rollout projects supplemented by the continuing government-funded BDUK programme.

Whilst one of the other benefits of superfast broadband is the typically shorter lead-times for implementation, any large-scale network rollout is inevitably going to take months to complete. During this time it’s almost certain that a proportion of your sites, which were unable to receive the service at the outset of your transition, will be able to do so by the end.

A further consideration for businesses with many locations is dealing with churn in sites. New site openings and relocations can be a constant challenge for many organisations. When it comes to network services, this can be compounded due to business pressures to open new locations at short notice.

Information regarding new sites, such as existing telephone and broadband services, can be hard to come by, or indeed non-existent in the case of greenfield locations. To manage this challenge effectively, it is worth considering specialist advice on how to correctly ascertain the feasibility of network services to these locations. Forward-thinking organisations will actively consider superfast broadband availability as part of their property portfolio strategy.

Business at the speed of light

So where does this leave us? The superfast broadband marketplace continues to evolve at a fast pace. The UK’s main telecommunications infrastructure providers have ambitious plans that will extend coverage beyond the current 95% target. These also include new products that are already becoming available to deliver speeds previously the sole domain of dedicated leased lines, but at a fraction of cost.

For businesses with a large footprint of distributed locations, there are also significant opportunities to optimise the cost base of the network and escape from the constraints of basic broadband services without breaking the bank. Take time to understand your business and the broadband marketplace; the rewards of business at the speed of light are up for grabs.

Steve Watson is a Principal Consultant at Peru Consulting and specialises in IT Transformation and Commercial Strategy.  He has worked with organisations including British Airways, BT, Walgreens Boots Alliance and Travis Perkins.