How much does it 'really' cost to run a telco cloud?
New model from TMNG Global’s Cartesian helps carriers nail down data center costs and see if they should even be in the business
It is widely understood but seldom acknowledged that telcos often have a tough time identifying their cost of operations. A newly-announced total cost of ownership (TCO) model for assessing telco data center costs from Cartesian, a TMNG Global
Company, tries to address that shortcoming.
The model incorporates 700 data center requirements, including taxes, insurance, labor rates, and climate impacts on heating and cooling costs, from one geographic location to another. Overall, the data center TCO Model provides a comprehensive view of capex and opex for data center planning, consolidation and continuing operations. The model can simultaneously perform side-by-side comparisons in a single view, enabling visibility across multiple elements for IT executives.
According to Joe Sharkey, Vice President of TMNG Global and chief architect of the model, clients are seeing upfront costs improve by as much as 30% and up to 35% improvement in ongoing expenses.
“We have been doing a lot of work around the cloud recently and have learnt a lot,” added TMNG Global’s chairman and CEO, Rich Nespola. “We had a long hard look at the cloud as part of a project to find the ‘next big thing’. From that research we developed an understanding of the real cloud opportunity and produced this data center TCO model as we expanded our thinking.”
“For the first time, telcos can now fully understand next generation data center costs,” he said. “Only if you understand the costs, can you develop robust pricing plans and so have far more confidence in the financial impact of your overall plan. This model is comprehensive and with every variable built in facilitates the decision making process. Because we do not ‘sell’ cloud products or services, we do not mind if the decision that the model helps telcos arrive at is ‘do not build a new data center yet, or here.’ What we are also finding is that companies from outside telecoms are approaching us asking to help them make decisions about data canters – construction is a good example.”
Commenting on cloud concepts generally, Nespola pointed out some misconceptions about the cloud. “A CIO can wake up one morning and have this great idea to use the 30% unused capacity on his servers. He advertises the space, puts in the checks, balances and firewalls and suddenly he is providing cloud services – but only in the most basic sense. The real cloud involves multiple devices, for instance – thank you Apple for iSync – but it requires a completely different level of orchestration. I think it will be a brave telco that puts ERP systems in the cloud anytime soon.”
Expanding on the cloud theme, Nespola cited IBM, who have pointed out that cloud computing can cost 80% more than simple outsourcing, “careful thought is needed before telcos jump into the cloud,” said Nespola. “there are seismic shifts taking place amongst the partners in telecoms. From recent work, we have a good understanding of the economics surrounding the still nascent cloud processes and technology. Frankly, when it comes to the cloud the rules have not been written yet.”
Want to use this article? Click here for options!
© 2014 Penton Media Inc.
In this Webinar you will learn how to create a real-time relationship with your customers, how to proactively improve the customer experience, and how to successfully target and cross-sell services to boost incremental revenue.
- Megabytes to Megabucks, Bandwidth to Business Models: How 4G Is Changing Everything
- How to Unplug Your Redundant Telco Apps To Save Money and Improve Efficiency
- When IaaS Isn't Enough: Service Provider Business Models to Drive Growth and Build Margin
- How to Transform Your Aging Telco Voice Network to Drive New Profits and Revenue
- Creative Licensing Approaches for Telcos & Their Network Equipment Vendors
- Smart Home Opportunity: Balancing Customer Data & Privacy
This paper discusses the rise of Diameter and benefits of Diameter Protocol.
- Conducting The Orchestration – Order Management at the Speed of Business
- Toward a Converged Network Edge
- Beyond Spam – Email Security in the Age of Blended Threats
- 6 Important Steps to Evaluating a Web Filtering Solution
- The Expertise to Protect You from Botnet and DDoS Attacks
- Seeing is Believing – Bridging the Order Visibility Gap
Service providers are under tremendous pressure to turn up new services faster then before and, at the same time,
to do it at less expense - and intra-office fiber is one of the biggest challenges in terms of both cost and service
From the Blog
Join the Discussion
Get more out of Connected Planet by visiting our related resources below:
Connected Planet highlights the next generation of service providers, as well as how their customers use services in new ways.Subscribe Now