Carrier layoffs starting to impact network performance

The wholesale personnel cuts being made by carriers is starting to show up in some key operating metrics, according to Matrix NetSystems, which monitors thousands of routers on the Internet.

According to some of the company’s most recent reports, two of the three key measuring sticks of Internet performance, latency and dropped packets, are on the rise. At WorldCom, which has been slashing staff as it winds its way through bankruptcy, packet loss numbers have increased five times, according to Bill Palumbo, CEO of Matrix NetSystems. Likewise, the latency averages across Sprint’s network have risen about 40% since the beginning of the year.

“Networks are a little like airplanes. They’ll fly for a few weeks without any intervention, but if you don’t maintain them, they’ll fall out of the sky,” he said.

Ironically, while the layoffs of key operating personnel will have a negative impact on network performance, a company’s filing for Chapter 11 protection often has the reverse effect, Palumbo said.

“In Chapter 11 we see an improvement in latency because customers leave and there’s more available capacity,” he said. “And as they go to other networks, latency goes down.”

In one example, measurements of Global Crossing’s network have held steady since the beginning of the year, just prior to the company filing bankruptcy.

“Their latency is identical to what it was before and they’re managing their network very well,” said Palumbo.

By contrast, a company like WorldCom is in a much more difficult situation. If the company goes through a much anticipated sale of some of its network assets, uncoupling its hodgepodge of networks could will likely lead to a degradation in performance, said Kirsten Husak, customer operations manager at Matrix.

“Reduction in capacity will definitely lead to an increase in latency and packet loss,” she said. “You’re always going to see a spike in latency. No matter how well they’ve planned [the transition], it never goes as smoothly as they want.”