By Matthew Toth, CEO, C3 Technology Advisors
We’re hearing a lot about the resurgence in manufacturing — Bloomberg reports that U.S. factory production rose for a fourth straight month in December, capping the strongest quarter since 2010, and Federal Reserve data shows the sector primed for further advances.
Unfortunately, today’s Fortune 5000 global manufacturers are saddled with WANs that are not only ill-equipped to handle cloud workloads, they’re actively hindering the full productivity and value of employees and applications. The typical F5000 private wide area networking model is also expensive and overly complex.
Based upon more than a dozen interviews with F5000 global manufacturing companies, we see the typical wide area network looking like something like this:
The explanation is that years of acquisitions and divestitures have splintered the power structure. This is outside of manufacturing as well. As many partners will recall, the typical WAN of 20 years ago connected mainframes with clients primarily via point-to-point links that were extremely slow and expensive. Bandwidth couldn’t be shared at a network operator level.
Frame relay mostly replaced point-to-point as a less costly option that also enabled clients to mesh locations together using PVCs. Frame relay gave way to MPLS around 2005 thanks to its lower cost and ability to provide better prioritization of applications.
Then, for most large companies, time stopped. WANs were seemingly frozen in place.
Problem is, in 2005, the internet was still in its infancy, Office 365 hadn’t been invented, public cloud didn’t exist and virtualization hadn’t taken hold. Client data centers hosted 99 percent of enterprise applications.
MPLS was the perfect WAN technology for the time, but that time has passed.
Today’s enterprise network must support public cloud, private cloud, SaaS, Office 365, DevOps, remote users, cloud interconnects and legacy applications — and do so securely. MPLS is not up to that task.
The fact is, most F5000 WANs are stuck in 2005 for two main reasons.
First, network operators, including AT&T, BT and Verizon, didn’t innovate. Yes, incremental improvements were made to MPLS, but the core technology didn’t change much, because there’s no impetus to invest in R&D. The network operators’ landline divisions are, overall, a profitability drag on overall earnings.
For operators, wireless is significantly more profitable than wireline. So there’s little appetite to disrupt the market for MPLS, the highest-priced and highest-margin WAN product in the landline division. Would you further reduce profitability in an already financially weak sector of your company? Absolutely not. Operators are going to ride that MPLS gravy train until it’s disrupted, and then do their best to integrate that disruption into that legacy revenue to increase the life expectancy of MPLS.
Second, Cisco sales and engineers have, through an ecosystem of sales, support, certifications and training, continued to push MPLS. Cisco’s domination of UC and desire to provide a stable environment for its products meant a perpetual backing of MPLS. Many engineers to this day do not believe that any kind of QoS is available when an internet last mile is utilized, which is false.
So where does this leave F5000s?
Click through our gallery below for lessons on how to help customers make the move to SD-WAN — and why.
Matthew Toth is founder and CEO of C3 Technology Advisors.
How to Sell? Push the Pain PointsGetting the conversation started with Fortune 5000 customers can be a struggle. Engineers hate to mess with their WANs. But there are nine conversation starters, focused around their concerns about legacy wide-area networking and whether it can support the cloud connectivity that line-of-business (LOB) leaders demand.
So what should you advise your F5000 customers to do?
Yes, their Cisco guy is telling them to evaluate Viptela. Keep going.
As an adviser with expertise in this area, you know what to look for. Nix any contract change that will reduce your ability to help the customer introduce technologies, such as SD-WAN, that can reduce spend.
Most F5000 companies also have VPNs in place for small offices and remote workers. Some SD-WAN providers, like VeloCloud, can accommodate IP-Sec VPNs.
Need more branch-office support? In this report, we explain how a hybrid WAN can bundle multiple connection types and provide customers with business-class features, security and connectivity to locations where traditional circuits would be prohibitively expensive.
It’s up to their leadership to assure them that moving to a more modern WAN architecture will help them keep their own skill sets up to date. And, less time spent on CLIs is more time they can devote to newer, more business-relevant techs.
In fact, it is our view that nontraditional suppliers with innovative SD-WAN products have a real opportunity to make waves in the enterprise market. F5000 customers – and partners – should keep an open mind when strategizing.
Channel Partners' regular SD-WAN roundups highlight innovative suppliers.
Our stance: Customers should plan on being breached, regardless of the number of layers of security they have in place. Focus on reducing dwell time and using behavioral analysis. Many of the customers we work with are trialing cloud-based security solutions, like cloud proxies from Zscaler, that are much simpler to deploy and manage than on-site security devices. In fact, Aryaka recently partnered with Zscaler to combine its SD-WAN with Zscaler’s cloud security. Zscaler also inked a deal with Riverbed.
Note that I personally shy away from claiming cost savings on an SD-WAN comprised mostly of internet circuits vs. MPLS because that money should often be shifted to security.