Thu, April 05, 2007 — CIO — Optimizing a WAN has never been more important. Newer technologies like IP VPN, MPLS and Ethernet WAN are forcing companies to reconsider the trade-offs of class of service, speed, security, flexibility, architecture and cost. According to Aberdeen Group, the typical Fortune 500 firm dishes out 3.6 percent of revenue on network services, equipment and assets. That represents more than $327 billion per year, and the largest recurring cost within the network environment is the WAN. Those who manage WANs the best truly stand out from their peers, according to Aberdeen's recent study "Latency Matters: The WAN Benchmark Report."

Best-in-class companies see WAN services as a necessary business infrastructure and don't let price get in the way as much as average companies do. "Cost is still the number-one challenge for the best-in-class companies, says Peter Brockmann, VP and research director at Aberdeen and author of the study. But these firms measure their WAN availability and performance better, to get the most from each dollar, he says. "They have the processes, organization, knowledge and technologies to respond more directly to the challenges of operating WANs, and managing the transition to advanced services like Ethernet WAN or MPLS." (See our three best-practices tips for specific advice, this page.) Those newer services offer benefits including lower network complexity and higher scalability, he says.

Ninety-four percent of survey respondents expect bandwidth requirements within the WAN to grow in the next year. But the best-in-class companies predict 19 percent bandwidth growth on average, compared with 31 percent growth for the other companies. Moreover, these best-in-class firms predict no spending growth on WAN services, compared with 7 percent spending growth for the other companies.

Best Practices

1. Deploy tools and processes to frequently measure WAN availability, audio quality and service performance. This should include a 24/7 network operations center (NOC), Aberdeen advises. Integrate service provider escalation processes into the NOC for best-in-class management.

2. Deploy a total telecom cost management application or service. This will reduce avoidable service provider costs by up to 10 percent, according to Aberdeen's research.

3. Suppress the rate of bandwidth growth by deploying application acceleration or WAN optimization tools.