Big Ideas

IDC Director Elisabeth Rainge

By Monica Mehta

July 2007

In her research on and analysis of the network and service provider infrastructure management markets, Elisabeth Rainge has examined the challenges facing telecommunications software and network management players. Profit spoke to the director of IDC's telecom software programs about the consequences of technical downtime for telecom companies.

PROFIT: What effects does downtime resulting from technical issues or upgrades have on a telecom company?

RAINGE: The communications industry runs on a 24/7 basis. The big challenge is to keep service running continuously. There are two main risk areas companies need to address: customer satisfaction and revenues. Poorly handled upgrades can hurt customer satisfaction and cut back on future revenues if customers switch to other providers. Outages or degradations in network service can also result in the need for rebates to large business customers and even possibly the missed opportunity to bill for traffic. There is also a regulatory risk: governments expect companies to provide connectivity and connectivity information—if they don't, they will be fined.

PROFIT: Why is technical uptime particularly important for the communications industry?

RAINGE: Communications companies face an uphill battle to gain customer satisfaction and successfully charge for all usage of their infrastructure. Technical issues limit their ability to work toward both of those goals. We're talking about an industry that operates in terms of millions of customers; millions—if not billions—of data points, such as minutes of use or bytes of data; and incredible levels of availability. Despite the many firsthand experiences of dropped mobile calls we've all had, the fixed-line operators continue to set the bar for uptime. In many cases, we tend to think of telephone service continuing in the face of a natural disaster even if electricity fails—that's high availability.

PROFIT: How can companies minimize downtime?

RAINGE: Planning is key. The established companies are experts at this. As consumers, we might think that they move slowly, but it's usually because they are so careful to build strong, highly reliable systems with lots of backup plans. It's been only fairly recently that businesses are investing in substantial power systems for their data centers, but the telecommunications industry has had this as a requirement pretty much since Day One. After all, the connectivity capability of your traditional fixed-line phone is relying on a network that is powered by the operator—not your wall socket.

PROFIT: What are the other challenges telecom companies are facing?

RAINGE: We are seeing a real change in the technologies underpinning the communications infrastructure. The proprietary systems from the traditional telecom infrastructure companies are leveraging the huge advances we've seen in the IT industry. This means that companies are looking not only to their traditional suppliers but also to IT industry leaders. In this area of convergence, the need for outside help is high. Also, as part of the IT/telecom industry convergence, we're seeing companies develop broader and wider skill sets. The challenge for companies is to build technical knowledge to operate the newer networks while improving their ability to respond to customer requests. Companies need to be flexible with their technology. A telecommunications company is never fully able to predict when network load will experience exceptional peaks and valleys. The best approach is to plan for reliability and flexibility.

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