Voice over IP

VoIP has become a mature product. Configurations to support VoIP are standard. Vendors are now able to distinguish the VoIP traffic from normal data traffic with MPLS and provide the high priority service it requires. It simplifies and saves costs for moves. Although VoIP can be a cost effective solution when implementing a new site, or if you need to replace an end-of-life PBX system, it may not always be the most cost-effective solution.

The answer to questions regarding the feasibility of migrating to VoIP services from traditional telephony services is, it depends. You need to understand your current costs. Capture your monthly phone charges, long distance charges, including costs for on-network and off-network, plus the costs for additions, moves, and deletions. For larger companies where it may be a difficult task assembling all the costs, pick a number of locations to represent the typical locations within your organization. This will give you a representative cost structure that you can apply with some accuracy over the remaining locations.

Review various options for implementing VoIP systems. The options range from doing everything yourself to having the voice and data network portions fully managed (as shown in Figure 1). Of course, there are numerous options between these two.

 
Figure 1: VoIP options

If you have capable staff that could easily pick up the technical skills needed, implementing and managing VoIP yourself may be the best option. If skilled staff is missing or workloads prevent picking up the additional responsibility, a partially or fully managed system may be the best option. Vendors will often propose one option, typically a fully managed system, as that is more profitable for them. However, they should be willing to tailor a system for a partially managed solution if you desire. Discuss various alternatives with them so you fully understand all your options and the associated costs and benefits.

To help determine your planned solution, build a VoIP business case. Ideally, the costs associated with converting to your VoIP solution, including on-going costs, are low enough to justify replacing the legacy voice system without any other factors. Many times this is not the case and you will need to consider other cost savings factors that are possible with VoIP solutions. VoIP cost savings include:

§  Elimination of conference call costs

§  Productivity improvements by combining voice mail with e-mail, plus implementing other unified communications services which eliminate the need for people to leave multiple messages when contacting staff for priority action items

§  Improvements in business services where some companies find they can reduce staffing requirements while improving customer service by implementing new telephony applications

§  Simplified technology that supports the infrastructure needed for staff to work at home, which has several cost savings such as higher productivity and reduced office space needs

§  Minimal cabling requirements for new implementations as you run voice and data over the same cable

For business cost analysis, be sure to include all VoIP costs. Some are not necessarily apparent at the beginning of the effort and can substantially reduce savings. Be sure that you do not end up with a VoIP solution that costs more than the current legacy system. Some VoIP costs include:

§  Data network upgrade costs. The data network may require upgrades to support voice traffic. These costs can include hardware replacement and software upgrades. Also, make sure to include costs to support network bandwidth increases needed to support voice traffic.

§  Training costs. You will need to train voice staff on how to configure voice options with a VoIP system. You will need to train network staff to configure network equipment to support voice traffic, and you will need to train support staff to debug problems encountered with the VoIP service. You may be able to reduce training costs with a fully managed VoIP service, but you should still have some trained staff to manage the vendor.

§  Security. You will need to address security concerns on a continuous basis with a VoIP system. Security concerns are virtually non-existent in a legacy telephony system, but you now have to consider security as many viruses can now attack IP phone systems.

§  Hidden fees. Providers can charge hidden fees. While vendors may not always mention these fees in the discovery phase, these charges can show up on the invoices.

§  Merging services. Tying the data and voice network services together can have some operational impact. Data network upgrades or outages can now affect voice services. Business units that were accustomed to using phones as a backup when data network services were not available will find themselves without phone service.

Implementing VoIP systems provide long-term cost savings at best. It can require a substantial cost investment for a do-it-yourself approach. The payback may be multiple years out so make sure the company is ready for this type of investment. Although a fully managed system may save money given the costs of change, it may not be a high priority item for meeting overall cost reduction goals.

Cellular Plans and Invoices | VOICE NETWORK

Analyze the cost effectiveness of buying and supplying mobile devices, or have individuals record their business costs on a regular basis. It is typically more cost-effective to use a corporate-wide strategy for purchasing cell phones and cell phone plans than to have employees buy them. However, small- and medium-sized companies may find it is less expensive to reimburse employees for the actual minutes used for business on their personal phones. For company-owned cell phones, document and enforce cell phone usage policies. When deciding if cell phones will be company owned or individually owned, consider the following:

• The competitive threat of personnel interfacing with customers. For example, salespeople have customers calling their cell phones for all requests. If a salesperson then leaves and goes to a competitor, your customer may call to order from your company but end up ordering from your competition. Alternatively, the competitor has an easy prospect list as customer contact information is often stored on the cell phone.
• IT policy and support. If employees can get any phone they want from any carrier, they will expect you to support such features as company e-mail on their cell phone. In addition, if you want to enforce security, support email, roll out custom applications, or decrease support costs, this will be difficult on employee-owned phones.

Cellular phone plans are extremely expensive, dynamic, and confusing by design. Cell phones and plans are a less mature industry than land phone lines. There are thousands of plans, and costs vary significantly more than land telecom plans. Even off-the-shelf rate plans exist in the carriers billing system not normally offered to the public. For example, there are ways to reduce the roaming costs from several dollars per minute to pennies per minute. One company saved 30 percent by getting the appropriate plan from a wireless carrier. Many companies find they are on the wrong plan or significantly overpaying for cellular services. Companies that audit cell phone charges find that companies typically overpay 20 to 40 percent.

You can save a tremendous amount of money by accurately matching cellular calling plans to individual usage patterns. Although it is time-consuming, do this by reviewing phone usage and make sure you have the plan matched with the need. For example, if an employee's job requires texting, and the company is paying a tremendous amount for text messages, getting an unlimited text plan would save money. Similarly, if employees require navigational downloads, and these are not included in the plan, businesses are paying significantly more. The cost and use of international mobile calls is another area to review as costs mount with increasing global business. The cost of roaming calls and text messages vary significantly by country.

Make sure you are using the features that you are paying for. You may be paying for international calling for an employee that does not travel or call internationally. You may be paying for roadside assistance but the employee does not have a company car.

Cell phone contracts should be no longer than 12 months in duration, but you are able to renegotiate cellular contracts at any time, regardless of the length of the contract. The following are ways that companies have reduced costs for cellular services:

• Service level agreements are much more difficult to get for cellular service and can cost more than they are worth.
• After completing an audit and meeting with the carrier for corrections, review the subsequent invoices to ensure changes were completed accurately, rates were adjusted, and expected refunds were processed. Most cellular carriers have language in their contract allowing you to go back three months for retroactive credits. However, many companies have examples of cellular carriers having to go back 12 to 39 months for credits on mistakes.
• For international travel, consider purchasing SIM cards with local carriers and use rental phones. Using a SIM card and buying prepaid minutes reduces the cost of an international call while roaming from $4/minute to $.25/minute.
• To reduce costs of international calling, use one global phone that can be shared by international travelers.
• Consider using rental phones with prepaid minutes to save roaming charges.
• Consider offering the company's cell phone program to employees' families. When one company did this, it drove up participation and reduced rates.
• Note any early termination fees. Although it is difficult to eliminate or obtain deals in this area, try to get caps or protections. For example, cap line terminations at one year, have fees decline as the end of the commitment is reached, prorate charges, grandfather minimum service periods, have a waiver pool, and provide the ability to change plans or equipment without renewing the term.
• Understand your traffic patterns so that you can negotiate accordingly. Consider pooling minutes, flat-rate plans and plans with free off-peak and mobile-to-mobile minutes. Negotiate reduced overage charges. Consider enterprise plans with domestic roaming and long distance included.
• Enforce policies on international usage, off-peak, data usage, Internet usage, texting, and personal usage. Communicate with employees so there is a heightened awareness of waste, fraud, and abuse. Manage company wireless devices and, if they are lost or stolen, remotely activate them to wipe them clean. Ensure that only company-approved applications are loaded on devices.
• Review acquisition and renewal credits.
• Consider having multiple mobile service providers for increased leverage and maximum coverage. However, too many carriers will result in loss of in-network calling benefits.
• Review rates for BlackBerry, Windows Mobile, and data cards because rates are decreasing. Negotiate the rate for tethering BlackBerries to laptops for Internet access.
• Consider integrating mobile devices with the office network so that wireless calls placed in the office go over the office network.

Many companies are overcharged on their cellular telecommunication invoices, yet few have a regular and effective audit of their bills. Even more than land telecom invoices, mobile telecom bills are typically very long and confusing. As in land telecom, there are specialized consulting companies that can conduct an audit of your cellular expenses, and they are well worth the expense to employ. One company saved 30 percent of their annual telecom costs by an audit, implementation of managed services, and review of invoicing.

The following are some common areas of cellular overpayment:

• Paying for cell numbers no longer in use
• Paying for features not used
• Paying for Internet access
• Abnormal calling patterns for noncompany use
• Improper text messaging charges
• Incorrect billing

Land Line Plans and Invoices | VOICE NETWORK

The industry for land phone lines is more mature than cell phone plans and is highly regulated. Never sign land line agreements longer than 36 months as telecommunication costs continue to go down. As contracts come up for renewal, you have a lot of leverage for renegotiation. When renewing contracts, it is common to reduce costs by 10 percent by negotiating lower rates that depend on the mix of services, spending commitment, and length of contract. Consider negotiating miscellaneous costs such as damage costs, trade-in costs, etc. Also, consider provisions for annual or semiannual price reviews to ensure discount levels are competitive. Include a price stability clause into the contract as telecom carriers are able to increase rates without informing customers.

The following specific tactics are used by companies to reduce costs relative to land telecommunication plans:

• Consider multiple levels of service offerings, such as gold, silver, or bronze.
• Have clearly defined SLAs, with defined financial penalties in the event the vendor does not meet defined service requirements. Penalties should be large enough to have an impact on the vendor but not so large as to jeopardize their ability to provide services.
• Specify contract termination conditions, such as the inability to meet defined SLAs, a merger or acquisition of the vendor or your company, or a major change in requirements or infrastructure. In general, the easier it is to break the contract, the more the contract will cost. For example, a clause to terminate without cause would be expensive.
• Ensure that you cover all services under the SLA. Often, only outages to the primary service are covered. Also, make sure you cover other services such as service delivery or cessations with specific time frames.
• Consider using callback services to reduce international long distance charges.
• Consider cutting back leased line capacities.
• Consider getting rid of landlines and replacing them with gateway products that run traffic over the WAN, such as Voice over IP (VoIP). Once voice goes over the network, be aware that latency matters more than bandwidth, which means the details of network engineering may change.
• Consider funneling international call traffic through services like Google Voice, which can reduce the cost of international calls originating in the United States significantly.

It is complex to match the invoice to contracts and plans. Errors and overcharges are common. Bundled services and taxes are confusing. Invoicing becomes inaccurate as telecommunication vendors merge and consolidate or your company goes through acquisitions and divestures. Many companies find that at least 25 percent of telecommunication invoices contain errors in billing, usage application, overages, tax application, etc., which causes a 25 to 35 percent overpayment for services. As an example, for over two years, one company paid for 56 phone lines set up for a modem bank that they never implemented. The following are typical errors found in land telecommunication bills:

• Paying for lines, circuits, modem lines, pagers, phones, or voice mail services that are unused or disconnected
• Changes to plans or lines that are not implemented
• Incorrect pricing or plan codes on the account
• Missing discounts or credits
• Duplicate charges
• Inaccurate service charges or charges that do not match the service record
• Services were upgraded but older services not cancelled
• Paying two carriers for the same line
• Paying maintenance contracts no longer in use
• Paying sales tax when the company is tax exempt
• Paying for optional or invalid taxes, such as the federal excise tax, which was repealed three years ago and is still found on many bills

Telecommunication Costs | VOICE NETWORK

Telecommunication is one of the largest controllable IT expenses for many companies, and it is a great place to begin your cost reduction efforts. Telecommunication services and contracts include land phone lines, fixed data lines, mobile and cellular communications, services, private branch exchanges (PBXs), call centers, and data network. Telecommunication costs are a low-hanging fruit for cost savings in many organizations as it is often an unmanaged expense. Many times, companies include telecommunication as one of IT's responsibilities often because of smart phones, and IT is not staffed or prepared to manage it. One advantage of telecommunication savings is that many of the cost savings actions have no negative impact on the business.

There are significant differences in pricing of telecommunication plans across carriers. Telecom is a competitive commodity, and vendors are typically willing to negotiate. Switching costs are also minimal, which encourages them to work with you (unlike the Enterprise Resource Planning software market). It is well worth your time to find the best combination of required services and support at the best overall price. There are thousands of telecommunication plans available, and it is an extremely confusing area. Companies save a considerable amount of money by reviewing how their telecom plans are structured overall. Consider switching or consolidating carriers after thoroughly reviewing costs. Do modeling to see if it is better to buy out an old plan or ride it out.

Telecom invoices are very confusing. Many specialized consulting companies are able to conduct an audit on your telecommunication expenses and guarantee significant cost reductions, which makes them well worth the expense to employ. These audit companies will charge a flat rate or charge a percentage of the total money they are able to recover. The auditing company also typically works directly with the telecom provider to get adjustments and corrections. As these companies specialize in telecom invoicing and audits, they are familiar with common mistakes. They know what to look for and know what reductions to expect from carriers. They also stay abreast of new offerings from telecom providers and can bring these offerings to your attention when they can lower your costs.

The following are tactics that companies have used to save costs on both land and cellular telecom:

• Make sure you have complete information on your current inventory and contracts. Make sure you are using all the lines for which you are paying.
• Centralize telecommunication services and billing through one area of the company to ensure you negotiate the best rates and appropriately monitor charges.
• Determine and document your requirements, develop a request for proposal (RFP), and obtain multiple bids before selecting one or multiple vendors. Do not base decisions solely on cost, but consider a vendor's track record, experience, additional services, reputation, ease of support and customer service, contract specifics, and flexibility. Consider reverse auctioning for telecommunication services.
• Negotiating telecommunication agreements is complex and time-consuming. Consider obtaining professional assistance from specialized experts. This service is well worth the cost and saves a considerable amount of money. Do not necessarily rely on the telecom rep to get you the best rate as they are motivated by account growth. In fact, if you significantly reduce your rates, your rep may actually try to be reassigned. The companies providing this service have the advantage of knowing the current rates other companies have been able to obtain. They can also structure their service in many ways. They can come in and cover all aspects of negotiating a contract for you or just provide consulting services at key points during the process. There are countless positions in between these two options that can be customized to offer the specific service you need.
• Obviously, negotiate costs defined in the contract. Costs are typically dependent on a number of factors and terms that are adjustable. Consider trimming services or features to reduce costs. For example, a key determinant in the cost of the contract is the level of service defined, so do not define service levels beyond the business needs. Other factors that impact cost are size of contract, length of contract, termination clauses, and financing arrangements. In your terms, specify the ability to short pay disputed bills.
• Times of economic pressure offer a great opportunity to renegotiate contracts as it is a buyer's market.
• Vendors will offer additional discounts to get all your business. Of course, be aware that if you have a single provider your risk increases and leverage decreases. Include clauses of prenegotiated discounts if you should move all your business to a single provider.
• Be aware of switching penalties, steep fees, and cancelation clauses before you begin the process. However, do not let cancelation charges discourage you from switching providers or evaluating alternatives. The savings may be more than the switching costs or the new vendor may absorb some or all of the penalties or switching costs.
• Make sure you specify contract terms and costs for equipment, design, installation plans, transition services, testing, monitoring, warranties, maintenance, training, payment terms, and conditions.
• Automate telecom billing and payment or consider a service provider. Online payments can lower the internal costs of processing, and may result in discounts.
• As you add or terminate employees, or close offices, ensure processes are in place that allow you to make appropriate changes to telecom and network charges and invoices.
• Consider outsourcing the management of telecom expenses, particularly if you are not doing a good job at it. At a minimum, do frequent audits.
• Start negotiations early, for example, six months before your current contract expires. If you are trying to negotiate weeks before your contract expiration, you do not have favorable leverage. If your commitments have been met early, you have considerable leverage.
• Always take advantage of rate review opportunities. Do not just renew existing deals because prices continue to drop. Contract extensions are typically more than 10 percent higher than rates you could realize with a competitive RFP process.
• Identify noncompetitive pricing opportunities before beginning negotiations. Consider getting third party benchmarks to establish negotiating goals.
• Make sure negotiated rates are included and fixed in the contract. Stabilized discounts are not the same as stabilized rates because discount rates in the contract that apply to a service table on the vendor's website can lead to unexpected rate changes during the contract term.
• Make sure effective dates of new rates or discounts are clear and specific. Consider asking for a credit to cover the time from when the contract is signed to when new rates and discounts are effective. In exchange for price reductions, many carriers demand two and three year extensions that can destroy your leverage. Make it clear that you will not sign more than the term you had originally intended.
• Carefully review and understand commitments. Avoid monthly commitment rates and consider either annual or term commitments. Try to negotiate a term commitment at a low percentage of the contract spend. For example, a $1M term commitment for a three-year contract with an expected expenditure of $2M that will be satisfied after 18 months. This provides additional leverage to negotiate better rates after the 18 month point, or provides a transition period if you decide to move the service to another vendor. If you cannot negotiate a term commitment, settle for an annual commitment, but keep the commitment amount low. Pay attention to minimum service periods for lines, circuits, and ports; they can be worse than a revenue commitment. Understand what counts for the commitment and what is exclude, commitment adjustment clauses, if commitments are gross or net, and commitment carry-forward or carry-back clauses.
• Review termination charges because they should not be more than you would have paid and they should not result in a loss of discounts.
• Pay attention to taxes and surcharges. Costs can add up and increase over time. Examples of taxes and regulatory charges include the Universal Service Fund, Federal Access Recovery Fee and, Federal Annual Regulatory Fee/Carrier Cost Recovery Charge. These fees and surcharges can be more than 20 percent. Be sure to include these costs when comparing vendors and considering changes, and to include taxes and surcharges when calculating credits.
• Make sure the contract includes terms for any major changes such as potential downturns in business, office closings, mergers, acquisitions, or divestitures; these can have considerable contract ramifications. Negotiate an "acquired entities" clause prior to needing it. For example, try to get the right to consolidate acquired agreements and to retain the right to have multiple carriers to maintain leverage. Make sure terms include a reduction in the commitment for divestitures or office closures.
• Be aware of additional charges for managing the account, such as network management reports, managing toll free numbers, paper-based bills, updating the asset management database, account management, site surveys, and management of the service level agreement. Negotiate these charges up-front and try to get them at no additional cost. Make sure you specify any services you need in the scope of the agreement or have language for the total charges to be incurred.
• Consider the payment due date. Ensure you can pay in the specified time because you may not receive the invoice until 7 to 10 days after the date of the invoice and you could incur late charges. Consider asking for an early payment discount or credit. Specify that you will not be charged with late payment penalties on disputed charges.
• If you find an error, go back and get credit for past billings. For disputed amounts, a customer can go back two years and ask for corrections. However, a carrier can make billing adjustments back six to twelve months. If the contract defines time limits regarding how far the vendor and customer can go back on billing errors, consider your experience with the vendor. Most error corrections tend to favor the customer because vendors tend to forget to apply discounts or apply them incorrectly. Therefore, push for a longer timeframe, such as a year. If you have a particular vendor that tends to error by forgetting charges and then hitting you with back billing charges, push for a shorter term, perhaps three to six months.
• Closely manage to your contract. After implementing a new contract, carefully review invoices to insure the new discounts are applied correctly. Meet with account teams on a regular basis and have them do the work to demonstrate accuracy. Review service level agreements, track spend compared to commitment, new orders, disconnects, andadditional project volumes. Make sure you give notice for extensions and renewals as required in your contract. If you have excess spend over commitments, consider moving services (e.g. conferencing, outbound long distance, ISP ports, remote access) to get additional savings. Obtain reports on lines with zero usage to identify unused lines.
• If allowed in the contract, consider doing an audit to recover some money. This will also send the message to your carrier about managing to the contract. Evaluate the various pricing methods for an audit because audit fees can be on a time and materials basis, contingency, contingency with a cap, or a fixed fee.
• Educate employees on ways to reduce telecommunication costs. This could include guidance on when to use conference calls versus external conferencing services. Many internal systems are less expensive and can conference up to six parties. Train employees not to use directory assistance from desk phones because it can be costly. Use laptop air-card for Internet connections on trips rather than using expensive hotel or airport connections.

DATA NETWORK | Reducing IT Costs

Internet Service Providers

There have been many advances in internet service provider (ISP) services over the last several years in terms of bandwidth, availability, and reliability. It is true that they do not offer a full service level agreement if you are crossing multiple Internet providers between a remote site and your data center, but it has become reliable enough to use in many situations.

From the chart you developed to define the prioritization of infrastructure components, identify sites that do not perform critical business functions and investigate moving these locations to an ISP connection. The costs will decrease and usually bandwidth will increase to provide quicker response times to the business at this location. For locations with two wide area network (WAN) connections installed in order to provide a more reliable service, consider moving one of these locations to an ISP connection. This will lower the overall cost for supporting each location. Also, set up routing so the business traffic will route over the existing WAN circuit and utility traffic will route over the ISP connection. Then you can route the business traffic over the ISP connection in the event of a failure of the WAN connection. However, since utility traffic is nonessential, you do not need to route it over the WAN connection in the event of a failure with the ISP connection. You will save the expense of upgrading the WAN connection to support all the utility traffic in the event of an ISP connection failure. Examples of utility traffic are software distribution, antivirus updates, and FTPs. You are also able to route Internet bound web traffic over the ISP connection. Routing this traffic over the ISP connection relieves congestion on the primary WAN link and provides better service for business traffic. Since the ISP connection provides higher bandwidth for lower costs, using this connection to support video applications is a more cost-effective solution than using the WAN service.

Bandwith

Users never have enough bandwidth. Complaints of slow response time will come in on a regular basis unless you have oversupplied locations with bandwidth, which is not advisable if you are trying to control costs. Ensure that locations are actually using the bandwidth provided for business traffic before making an upgrade. Bring in tools to provide the ability to analyze traffic at a location. Determine if users at this location are performing nonbusiness bandwidth-consuming functions, such as downloading MP3 songs or listening to streaming audio. If this is the case, have this traffic stopped by talking to management at the location and identifying the staff performing these functions. Taking the time to do this will help foster an environment where employees use computer resources only for business functions.

You can implement many products and services to stop employees from using the Internet for certain nonbusiness traffic. This is a preferable solution as it stops the downloading of MP3 songs, listening to streaming audio, etc. It saves personnel time in tracking down violators and prevents slower response times at a business site. However, this is not a cheap option. If funds are limited, spend the money on analysis tools because you need to know traffic patterns either way.

As a rule, you want to provide enough bandwidth capacity to support business requirements at a location. There may be sites or vendor price points that make oversubscription of bandwidth a good selection. If there are business-critical sites for your organization, then managing bandwidth too closely may cause a significant impact to the business that is not worth the savings. Spending more at these locations to provide extra capacity is worth the cost. The other decision in bandwidth management is looking at vendors' price points. Some WAN vendors have started providing full T1 Multiprotocol Label Switching (MPLS) connections at a lower price point than higher-speed fractional T1 connections.

Multiple Vendors

At a minimum, have two vendors for WAN services. There is no vendor that has the best pricing for all services. As new services are required, have the vendors submit bids. Let them both know that you are requesting bids from multiple vendors. This helps in reaching the lowest cost solution from both vendors with a minimal time investment from your organization. When ordering the same service from both vendors for a single site to ensure carrier redundancy, compare their service delivery time against each other. The more competitive positions you are able to put them in, the better.

two vendors against each other on an on-going basis will provide some savings, the more significant savings will come during contract negotiations. Vendors will state that the larger amount that you spend and commit, the larger discount they provide. It is true that vendors will provide a higher initial discount in the negotiation process, but where the discount ends up is more a factor of how well you are able to convince the vendor that you are willing to switch service to another provider. If you only have one vendor, it is more difficult to convince them you are willing to switch.

Another compelling reason to use two vendors is to provide two physically separated points of presence. For example, a backhoe could sever only one of the cables rather than both.

If using two vendors, be sure you clearly define roles and responsibilities to minimize finger pointing. Vendor contracts should include provisions for working with other suppliers.

Network Design

There are many ways to design a network However, some network designs are more cost-effective than other designs. The following are ways that companies can improve the cost effectiveness of their network design based upon their needs:

§  Dedicated solutions are typically more expensive than shared solutions. A dedicated circuit between two locations will cost more than installing the two locations on MPLS. Assuming one of these locations is your data center, you are now able to use this MPLS connection to support other multiple locations. Once you add a site to the MPLS network, it will have access to all other locations. This solution provides the ability to use more cost-effective bandwidth at the data center (higher bandwidth drives a lower cost per KB), which reduces the amount of equipment required.

§  will substantially save costs with the implementation of a disaster recovery site. You are able to connect the disaster recovery site to the MPLS network and immediately have access to all sites.

§  Use Internet services where applicable. Internet service does not come with a service level agreement (SLA), nor does it require the same time to restore as other services. However, overall Internet services such as DSL and dedicated T1 access have become more reliable. If the particular location does not need the SLA provided by other services, installing an Internet connection saves costs.

§  Supporting Microsoft services over a WAN requires expensive high levels of bandwidth. Investigate WAN optimization products that provide Local Area Network (LAN)-like response times over a WAN without the need to increase bandwidth.

§  Validate assumptions about how the business functions as the business needs might have changed over time and you may need to make network design changes. For example, one company looked at how sales people in the field completed work and was able to reduce costs by making changes to the network design. These changes more closely match how work was being done—including at home, at Starbucks, and at the office. Up-times and redundancy needs in field offices were also different from when they originally designed the network.

§  In times of desperation, approach the business with the costs of backup services to primary WAN connections. Include statistics of outage frequencies and durations. The business areas may be willing to run the risk of an outage given the costs to provide the backup during tough times.

§  of new technologies and consider using them to lower telecom wireless and data services costs. For example, MPLS can carry data and voice traffic at lower costs, or use session initiation protocol (SIP) to consolidate local voice, long distance, and data services.

§  Review chatty applications, the possibility of content or data distribution, and application re-design improvements to reduce network bandwidth requirements.

§  Investigate wide area Ethernet access as an alternative to DS3s and T1s.

Network Monitoring

Monitor the performance of network components to ensure they are operating efficiently. Check network and telephony traffic to find out how much capacity is necessary. Bandwidth may be oversubscribed. Monitor consumption for opportunities to right size and scale back on costs for WAN, Internet, and telephony connections.