Broadening channel horizons
The broadband revolution is gathering pace and offers resellers a number of lucrative sales opportunities, writes Paul Bray
The potential uses of broadband have grown significantly since its introduction in 2001. Back then it was principally designed for web browsing, providing high bandwidth in one direction (for downloading content), but limited bandwidth in the other direction (since all the users needed to upload were a few commands and the occasional email or document).
Today, with Asymmetrical Digital Subscriber Line (ADSL) download speeds of 8Mbit or more and upload speeds approaching 1Mbit, the picture is significantly different.
Adrian Sunderland, chief technology officer of broadband ISP Griffin Internet, says: “With higher upstream speeds available, synchronous applications such as voice and video have started to be used over broadband.
“As ADSL becomes more ubiquitous and more reliable, so corporate companies are looking to replace old kilostream, leased circuit networks with cheaper, faster ADSL alternatives. Similarly the rise in the adoption of VoIP [voice over IP] Terminal Server and Citrix-type applications has caused enterprises to beef up their home worker connections.”
If businesses are going to entrust their core networks to broadband, they will not put up with the uncertain performance of a contended, domestic-style ADSL connection, says Sunderland.
“Enterprises expect to be able to run Class of Service and QoS over their networks as they have always done on leased circuits,” he adds. “There’s no appetite to go back to expensive internet-based VPNs. One solution is to offer private VPNs that don’t touch the internet, powered by a sophisticated core routing platform that offers the ability to prioritise one application over another.”
Multi-site, private, broadband VPNs running to hundreds or even thousands of end points are where the big reseller opportunities are, Sunderland claims.
Chris Gabriel, head of solutions at VAR Logicalis, says: “Broadband is changing the business communications landscape. It’s driving out massive cost in large site-to-site networks and it’s the platform for extending internal networks out to private VPN home worker environments.
“Private broadband is changing the perception of flexible and home working. It enables people to work through minor illness, strikes or terrorism by providing all the information and applications they need. We’re now seeing enterprise customers dropping IP phones into people’s homes for flexible working and business continuity. We have Nokia E61 Wi-Fi phones with IP clients running voice from home, across wireless, down broadband and through our internet gateways, and it works perfectly.”
There is a definite move towards highly secure, easy to install and low cost of ownership technologies that enable convergence, according to Rob MacKinnon, product manager at networking vendor Zyxel.
“Previously, running a converged network has meant paying for an expensive leased line,” MacKinnon says. “For SMEs or remote workers, cost is always a major issue and the advent of broadband has meant that convergence is now a possibility for these customers.”
Alasdair Ford, pre-sales technical consultant at BT VAR Servo, says there is a massive movement towards convergence. “Converged networks enable users to make voice calls over the IP network,” he says. “And using some of the latest mobile handsets, whenever users get within range of their home wireless network or a public access wireless connection to a broadband link, they can use IP telephony to make lower cost calls. In the corporate environment converged systems enable remote/home workers to keep in contact with their colleagues on the same system free of charge.”
However, convergence still relies on business-quality broadband. For consumers the technology may not yet be ready to replace conventional telephony.
Vaughn Armstrong, marketing director of broadband access solutions provider Westell Technologies, says: “Despite the success of VoIP services such as Skype, they could still be considered a niche application. I use both a VoIP handset and a videophone from home, supplied by a leading operator, and I have to say the voice quality is poor. I’d use a land line or a mobile to ring a customer.”
However, voice over broadband is gathering pace as broadband speed and quality improve, according to Richard Bligh, group marketing director at voice application vendor Gamma Telecom.
“ADSL Max is now a cost-effective bearer for multiple simultaneous calls and IP connectivity will ultimately replace ISDN as the main bearer for business voice services,” Bligh says. “Equipment connected to broadband on site for voice services such as ATAs [analogue terminal adaptors] is also increasing in functionality and reducing in cost, further fuelling the growth of this application, delivering increased productivity, greater service flexibility and cost savings.”
Quality and bandwidth are vital, Bligh adds. “Using the right provider and providing the right size pipe and contention are key for a successful voice application,” he says.
Bi-directional video applications, such as videoconferencing, are also becoming viable on the latest generation of broadband technology.
Karen Krivaa, marketing director at video specialist Radvision, says: “Videoconferencing between multiple remote sites is made available over IP today and broadband allows multiple solutions ranging from low-cost desktop to standard room conferencing and high-definition conferencing.
“Also, unified collaboration solutions are emerging to bring visual communications and data collaboration to desktops and mobile subscribers, driving the need for true scaleability and strong device support.”
A related application that is gaining popularity is CCTV over IP, which enables security cameras to be monitored remotely in real-time as well as transmitting images for central storage, proving extra margin and upsell opportunities for channel players. Some CCTV applications make use of “spare” bandwidth outside normal working hours, when security staff have to be at their most vigilant.
Increases in upstream bandwidth are also giving a boost to the concept of Software as a Service (SaaS).
“Higher bandwidths mean that customers can access hosted applications and software as well as online backup, which is good news for everyone,” says MacKinnon. “It creates more revenue for the reseller, while users save money as they can pay for software licensing on a pay-as-you-go model instead of buying expensive licences. It also means opportunities to sell more hardware to support multiple users where it’s important that users are able to manage the data streaming effectively.”
Ford says: “We’re seeing a growth in software as a service that allows smaller companies to access feature-rich systems by renting a subset of a larger system that they couldn’t afford to invest in on their own, allowing them to combine big business technology with small company agility.”
John Carter, managing director of broadband distributor DMSL, says ERP, CRM, human resources (HR), unified communications and database management are all popular candidates for SaaS.
“More applications will become embedded in the network,” he says. “The software as a service model, with per-seat pricing and pay-as-you-go options, will certainly become more popular. It’s very appealing to the customer as it dramatically reduces or cuts out capital expenditure.”
Electronic Point of Sale (ePoS) and chip-and-PIN applications are migrating to broadband because of its advantages over traditional ISDN or leased line solutions – notably low, fixed cost. Gabriel says: “Retailers want to deliver more services in stores, such as video advertising, building management and IP telephony, so the lure of private broadband networks has become unstoppable. It’s on every retailer’s agenda because it’s cheaper than old private wires and has better bandwidth and service capabilities.”
Whatever the application, resellers will almost certainly find it easier to sell if they provided the customer’s broadband service in the first place, says Carter.
“With SMEs this is relatively straightforward, because in most SMEs the decision-maker for broadband is also the decision maker for other applications,” he says. “It gets more complicated when different managers have responsibility for purchasing different applications, such as HR.
“However, whatever the size of the customer, the decision for messaging or voice services, for example, will almost certainly be made by the same person who made the decision on broadband. As such it’s really a matter of resellers going step by step and opening up the new opportunities as they go.”
Sunderland agrees that resellers need to “own” the IP connection to their customers, “otherwise they’ll soon find what used to be partners quickly becoming competitors and selling in their own applications. Customers want their suppliers to have total control over every aspect of the solution. As soon as the reseller starts blaming the ISP because its application doesn’t work, customers start looking for a new supplier.”
Gabriel says: “The big risk [for resellers] is service providers deciding to go direct and add more value to their networks. This is still a new market and the big ISPs see capable integrators as a threat because they provide the layer of value that takes away some of the ISP’s lunch. Only the smart ISPs see resellers as a major opportunity.
“The key for resellers is working with good service providers and knowing they need to add value on top of them. If VARs think broadband is signing up with a big ISP and delivering a vanilla product then they are just shifting another ‘tin’ service. If resellers can provide a layer of service between the service providers, this
is where they can add real value. Broadband is simply an enabler, opening up the opportunity to deliver services around agility, continuity and responsibility. If resellers are not thinking of delivering those things then they are not using broadband unbundling as a real differentiator.”
Resellers that lack specialist experience should begin with mainstream applications, advises Krivaa.
“Broadband applications that are not acknowledged as mainstream have significant risks if not supported by the major players,” she says. “But integrators who know how to add value to existing mainstream applications have little risk in adding different applications to their portfolio.”
However, a specialist background is not always essential. Many resellers with a data or IT background have been successful in the voice over broadband market, as long as they have the right partners, says Bligh.
Carter says: “It’s important to note that broadband can be a reseller’s way of selling new products that could get them into new markets.”
In the future broadband will become even more significant. “Broadband is at the heart of BT’s 21st Century Network (21CN),” Ford says. “It’s all about a standardised set of ways to connect and making interoperability easier. Broadband is already huge and can only grow as it becomes more viable for smaller companies to run hosted applications over broadband.
“We predict that there will be significant developments in wireless. We have near-broadband speeds through a range of mobile devices and as this improves, true location independent working will become more viable. But really it’s all about convergence.”
Carter adds that the effect of 21CN will be massive. Bandwidth will become ubiquitous and delivered in several forms: over fibre, through wireless network services and cellular networks, and through the standard copper infrastructure. IP will be everywhere and all applications will run over it.
“21CN is the gateway to the full convergence of IT and communications,” he says. “It will usher in a new era in which customer behaviour will change and the channel will need to adopt radical new business models that rely on services and focus on profit instead of product and turnover.
“There’s no real limit to the potential [of broadband]. It’s just a matter of resellers convincing customers that running applications over broadband makes sense in terms of cost and productivity.”