Power pit crew

Outsourcing is the trend, but are service providers ready to let someone else handle their most critical area? One vendor thinks they are

It's all about trust - and making things a little easier. It's outsourcing. Service providers are getting used to handing over control of their billing, construction or even operations support systems. But what about power? Could anyone really trust something that critical to another company? Some service providers say yes, they are comfortable letting another company equip and monitor their critical power needs. However, other carriers still believe the only way to do it right is to do it themselves.

According to a recent Telephony survey, 60% of service providers now are outsourcing; that number is expected to increase to 74% by 2001 (Telephony, Dec. 6, 1999, page 32). It has been said that letting a third party handle certain aspects of an operation lets a service provider focus on its core competencies. But few things are as critical to a network than power.

Nonetheless, Electronic Environments Corp. thinks it can provide those critical and hard-to-give-up applications and the personnel to make sure it's done right.

Welcome aid

In a nutshell, EEC provides facilities management. The Canton, Mass.-based company has been in business for about 15 years, and its goal is the "design, engineering and maintenance of high-tech facilities," says Andy Dimitri, president of the site services group. "Our strategy is to provide end-to-end infrastructure solutions for critical environments." It's like a one-stop shop, he says. The company began by serving mainframe environments but eventually broadened its focus when the industry changed, he says.

EEC found a lucrative market in telecommunications as a result of the Telecommunications Act of 1996. "That segment has exploded, though the Internet has resuscitated the IT segment as well. The competitive environment is forcing service providers to find ways to do things cheaper and better," Dimitri says. "We're no longer [targeting] just the back-office people but also management. And we're in the middle of a nationwide expansion." EEC now serves the Northeast, the mid-Atlantic, the Midwest and the Pacific states and plans to move into the rest of the country soon.

The company has no special arrangements with any power companies; it buys, installs and maintains the equipment as an independent vendor.

EEC provides equipment such as rectifiers, inverters, battery plants, generators and heating, ventilation and air-conditioning systems. The company is vendor-independent, Dimitri says, and tailors its solutions to service providers' needs. "We do a walk-through of a facility and present a number of alternatives."

EEC has traditional enterprise customers such as Motorola, Reebok and Staples, but its service provider customers, including UUNet, RCN, Omnipoint Communications and Nextel, are becoming key. "Data centers are our bread-and-butter business," Dimitri says.

UUNet uses EEC to provide certain power functions for its San Jose data center, says Mitch Ferro, director of product management for Web hosting at UUNet. "We found that in the co-location business, customers do expect 100% availability," he says. It seems logical, then, that the service provider would look for any way to provide such availability, even if it means going outside its own walls.

"EEC specializes in maintenance and monitoring related to telecom," says Dave Pickut, vice president of construction and engineering for the hosting services division of UUNet.

And that's rather rare, considering EEC's lack of actual head-to-head competitors in this space. Marconi and Liebert, for example, provide power solutions, Dimitri says, but they don't provide all the aspects of facilities management that EEC does. However, he acknowledges that these companies are getting into the game as well. "We look at whole facilities," he says. "It took some time to get here, and we don't have many competitors. We try to stay focused on the infrastructure."

UUNet considered a few other companies, but Pickut wouldn't name names. "A couple of other companies provide facilities maintenance, but the needs of a data center are very specific, and EEC has specialized in [that area]."

EEC supplies UUNet with uninterruptible power supplies, battery systems and cooling systems. It guarantees a two-hour response time, and UUNet has found that EEC lives up to that. EEC has worked with UUNet since April 1999 and provides preventative and scheduled maintenance and monitoring functions. The maintenance schedules are mainly determined by the type of equipment and manufacturer recommendations, Pickut says.

"If the equipment fails, we'll respond aggressively to avoid system downtime," Dimitri says. As for prevention, "We perform daily walkthroughs along with visual inspections and recurring maintenance on the infrastructure equipment." If EEC finds anything out of the ordinary, they bring it to the customer's attention and suggest solutions. EEC's goal is to maintain systems so there are few surprises. "That's where the 15 years of organizational experience helps out," Dimitri says.

UUNet seems to agree. "We are able to draw upon resources and expertise that we may not have with an on-site staff. EEC has a very extensive staff," Pickut says. But he acknowledged that UUNet does not have direct control, and it has to share EEC's resources with other companies because it chooses to outsource. To keep a level of comfort with EEC, the UUNet staff also monitors the systems. Moreover, "we have to thoroughly review [EEC's] reports and then we provide feedback to them," Pickut says. EEC has proved to be quite responsive and provides well-defined service level agreements, he says. "EEC is a source for maintenance and emergency [services]."

"Many of [EEC's] customers make standard inquiries based on the information we provide them - both for peace of mind and to ensure that they are up to speed on their facilities," Dimitri says. Moreover, EEC plans to roll out a Web-based database where clients can view information on their facilities, such as equipment make and model, work order histories and trending information, he adds.

Playing it safe

However, some service providers still consider outsourcing a dirty word. Although EEC named Nextel as a customer, a spokeswoman said Nextel didn't want to comment on the partner agreement.

Although Sprint doesn't necessarily consider outsourcing taboo, the provider does not outsource its power monitoring now and has no plans to do so in the future. The Overland Park, Kan.-based carrier gets its AC power from Kansas City Power and Light and takes care of its own DC power needs. Power "is critical to our business. I wouldn't consider handing it over to anyone," says Ralph Veazey, director of switch operations at Sprint. "Quite frankly, the reason I feel that way is because if we lose power, we lose our equipment. It could end up being a one point of failure. [Power] is a very critical area, and [outsourcing it] would be like giving my life preserver away."

Sprint's strategy includes backup generators, heat tolerance in its equipment and on-site monitoring of both the AC and DC power, "just because it is so critical. If we see something wrong, we take immediate action," Veazey says.

Nonetheless, EEC remains confident that enough service providers are willing to let a third party take care of their power needs to make its business profitable. "The more established companies have established facilities people, but upstarts don't have that. That's where we fit in," Dimitri says.

Case in point: NorthPoint Communications. "NorthPoint outsources its power monitoring today. The main reason for doing so is that NorthPoint can spend its resources on more intelligent pieces for building its network while leaving items like power monitoring to third parties who have the appropriate expertise and the facilities," said Shahin Bakhshandeh, NorthPoint's director of engineering.

NorthPoint houses its ATM switching gear and data center at major telecom facilities providers, and these providers perform power monitoring as part of their co-location agreements, Bakhshandeh says. "All these providers meet or exceed power backup and monitoring criteria."

However, some competitive carriers do have the facilities and resources and prefer to handle their own power monitoring.

Focal Communications prefers to monitor its own power, company officials say. GST Telecommunications also has the resources for power management. GST built in its own battery network and generator system when it installed its network, a company spokesman says.

Other carriers, such as Rhythms NetConnections, are still too much in upstart mode to consider outsourcing power at this stage. "Rhythms is in the midst of expanding and moving our computer room facilities. We expect this process to take several months. Until our expansion is complete, it would be premature [for] us to comment on outsourcing our power monitoring function," says Michael Lanier, Rhythms' chief information officer.

The competitive labor market also helps EEC; some companies simply have trouble finding competent personnel. However, Dimitri is quick to note that all companies have some level of in-house capability and that EEC's role tends to be to supplement in-house staff. "You never want to be 100% out of it. That puts you at risk."

Overall, it seems that providing reliability is the goal of service providers such as UUNet, and a third party can help them meet that goal.

EEC is quite aware of the tough sell it faces with service providers. However, Dimitri maintains that power outsourcing ultimately can pay off for them. "If you look at what we charge as opposed to an hour of downtime, it's not even close. It's up to us to condition the marketplace and educate them."

Even after EEC has established relationships with providers, "they can turn us off with the flick of a switch," Dimitri says. "That's a great incentive for us."