IP/MPLS Moves Customers, Channel Partners into Virtualized World

The telecom industry and its customers clearly are migrating from nailed-down, connection-oriented communication services to more dynamic and virtualized services. For channel partners, this creates both new opportunities and challenges. Monday’s Channel Partners Conference & Expo panel on “Making the Most of MPLS” will discuss what’s happening on this front and how agents, resellers and VARs can move to benefit from it.

As panelist Ted Wagner, director of VPN product management at Level 3 Communications Inc. noted, a lot of enterprises are moving from frame and ATM networks to MPLS/IP VPN environments. VoIP is one of the key application drivers for IP VPN; another trend fueling the move to IP VPNs is businesses’ desire to outsource their network management, he added.

All this changes the entire service paradigm for both the customer and the companies that sell the services, continued Wagner. That’s because in the connection-oriented world customers have to decide up front what bandwidth they need on each route and then have to manage that capacity, he said. However, with IP VPN, the customer is not required to set that bandwidth at service installation, and the management of the IP layer and circuit connections are outsourced to the service provide, creating huge operational savings for the customer, according to Wagner.

Of course, that savings can be the selling point for channel partners with an IP VPN/MPLS offer. And, said Wagner, channel partners can bring in the hardware like VoIP PBXs, as well as the network services (including the quality-of-service, or QoS, that MPLS enables), and other support or functionality to address these customer needs.

Level 3’s channel business partner model is based on recurring revenue based on the size of the sale. When a partner sells a Level 3 service/product they are commissioned for the sale and then receive a monthly payment equal to the negotiated percentage of payout based on the dollar amount of the sale for that service.

“The proliferation of new IP applications and how MPLS as a technology is a very flexible platform that enables that” is what this discussion is all about, added panelist Brett Theiss, director of product management, at New Edge Networks.

Theiss said that service providers are now adding more bells and whistles to MPLS, like QoS, to enable a wide variety of services, including both connectivity and services that allow small and medium enterprises to adopt software applications, for example.

The fact that both the network and applications are becoming more virtualized means customers need to understand what technologies they need to separate, segregate and prioritize traffic, and the channel is in the position to help educate them on that, stated panelist Martin Capurro, director of product management at Qwest Communications International Inc.

Panelist Bojan Simic, research analyst with Aberdeen Group, said in February his firm released the results of a study it did on branch office networks. Of those surveyed, 56 percent said they currently use services (like IP VPNs) based on MPLS. That means nearly half of the end users surveyed were not currently using MPLS-based services. By educating those end users on how MPLS and IP VPNs can enable them to support and prioritize a variety of voice, video and data applications on an integrated network, channel partners can position themselves to help these customers make the transition to this new, virtualized networking world.

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