What does BT think of IP?
An interview with Neil Hemming, BT Retail - General Manager Solution Sales.
What are the business drivers that you are seeing for migration to IPv6?
At this point in time, we don't see there being an imminent imperative for the migration to IPv6. The prevailing focus right now is working with our customers to determine their migration from prevalent layer 2 wide area network technologies to those of an IP VPN. Our customers are looking at version 6 alongside other technological developments and at the moment looking is as far as it has gone. The real demand for version 6 will be driven by the widespread adoption of consumer goods - the emergence of mobile services using 2.5 and 3 G, wireless LAN and the proliferation of PDA-type devices - all of this is in the future. The main driver for version 6 right now is in countries such as China and Japan who were late getting address allocations and with a growing population will be the first real adopters of version 6. To this end, the Japanese Government has stated that it expects to complete widespread migration to IPv6 by 2005.
What are your customers demanding in the IP space?
At the moment, it is all about cost cutting. The general trend that we are seeing is towards convergence - not just of voice and data networks but also of the WAN and LAN too. Bandwidth is increasing and we are able to offer lower cost VPNs. Customers are using IP to consolidate and rationalise networks based on the ubiquitous technology of IP. Some early adopters are moving to VoIP but widespread adoption is slow - that said the quality of voice over IP is improving but the economic case only exists in green field sites where new infrastructure is to be built.
What are customers demanding in the IP space that cannot yet be delivered?
Customers are looking for network technologies and services that deliver secure, robust, resilient communications on an end-to-end basis. The need for an end-to-end approach is driven by today's application architectures that are core to an organisation's business. Not everyone can deliver this on an end-to-end basis yet, but BT has made a significant investment, over £15 million, on operational systems management so that we are able to offer "business grade IP".
Another common demand by customers, although not a new one by any means, is in technology and vendor selection. The advantage that BT can offer here is that we can take a consultative approach in terms of giving independent advice, as well as being able to manage their chosen infrastructure solution for them, leveraging our capability in the Adastral Park technology evaluation laboratories where we assess the majority of new devices and technology at the request of the worlds leading manufacturers.
We are also seeing servers and storage move into the network as they are consolidated and rationalised; that delivers real cost savings and is enabled by advances in network technologies. Lastly, we have seen a big move in business continuity, again a service that is enabled by having access to networks of the highest quality.
What are the real benefits of IPv6?
The primary benefit by far is the removal of address space limitations. Added to that are the security and performance benefits but it will be a long time before these become relevant business benefits.
Why do customers come to BT for IP services?
We can simplify complexity and deliver end-to-end business grade IP services. Also, we have a breadth and depth of experience that can be matched by only a few and this, added to our vendor independence, allows businesses to come to us when they want to de-risk a project. This is proven in the most risk-averse vertical, finance areas, where 18 out of the UK's top financial organisations use BT services through an Outsourcing or Managed Services model to manage their data and/or voice networks. To a large extent, we see ourselves as providing the very fabric that underpins the Financial Services Industry, a challenge and a responsibility that we readily accept.
Our ability to deliver service levels such that network availability in the Wide Area is up in the "five nines" bracket (typically 99.995%) for our largest managed networks demonstrates our service deliverables where it really counts.
Who are BT's competitors?
We see competition in three areas. Firstly from the traditional telco's, such as Cable and Wireless, in the VPN and IP space. Here we differentiate ourselves through the scale of our investment to be able to deliver business grade IP. This is clearly demonstrated by our full network coverage across Europe rather than the patchwork quilt of our competitors. Our unique experience over the last 10 years of delivering 'connectionless' networks via our Switched-Multi-megabit-Data service has given us an excellent insight in providing and managing such services in a 'Carrier Grade' environment. This insight has lead us to invest heavily in our platforms and systems. We currently invest in the region of £15 million per annum in R&D on MPLS, and in 2002 to date, have added 1,000 ports to our IP VPN platform per month. Knowing that scalability and manageability are amongst the foremost concerns of our customers, we have also developed a unique network management system, not commercially available, to ensure that as the platform becomes increasingly loaded, we can still provide quality service and functionality such as Class of Service.
In the ICT sector, we come across vendors such as IBM. Here, we are able to play the new entrant without the baggage of hardware and software plays. Another advantage is that we are able to promote the idea of server and storage consolidation, as we have no hardware axe to grind. We are breaking into areas such as Storage on the premise that it is widely accepted that emerging network centricity cost savings are to be realised. As we have no legacy revenues to protect, we will take some compelling propositions to market with key partners to realise new revenues for BT, and cost savings for our customers.
In Outsourcing and Managed Services, we come across the traditional vendors such as IBM Global Services and EDS. Although we are still relative newcomers in this space, we are still able to make a strong play, as hardware becomes more network than data centre orientated.
Are customers migrating to IP version 6?
Some customers are still converting to IP from legacy networks and so it will be sometime before we see widespread adoption of IPv6. BT has made significant investment in seamless migration of existing platforms to IP with minimal business disruption, so we are ready when our customers are. Providing a graceful migration path, protecting the customer's investment in existing, proven technologies, to the world of the IP VPN is key. Giving our customer the ability to migrate when the time is right for them is a capability that is being warmly received by our customers.
What do you believe will reinvigorate the telecoms sector?
No more hype is the primary thing. Every sector gets hyped to some degree but telecoms has suffered more than most recently. The LAN/WAN and data/voice convergence will push business forward as customers realise that we can offer added value to the business rather than just being a telco utility. The advent of convergence will take us credibly into some new revenue growth areas, as our capability in areas such as LAN become exploited to the full as IP telephony gains real traction in the marketplace.
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