The outcome is predictable: bandwidth prices continue to fall. As expected, bandwidth prices continue to fall. Cloud providers such as Google, Amazon and Microsoft have changed the industry. They built their own massive fiber network while reducing their purchases from telecom companies. They have simultaneously pushed global fiber demand down and increased the supply. The result is that bandwidth prices have never been so low. And the advent of Software-Defined Networking (SD-WAN) makes it simpler than ever to prioritize traffic between costly private networks and cheaper Internet bandwidth.
This period should be the best of times for enterprise network architects, but not necessarily.hundreds of billions Many factors conspire against buyers who seek to lower costs for the corporate WAN, including:
Telecom contracts that are typically long-term and inflexible Telegeography reported Competition that is often limited to a handful of major carriers
Few choices for local access and Internet at corporate locations
The tremendous effort required to change providers, meaning incumbents, have all the leverage
The largest telcos, companies like AT&T and Verizon, become trapped by their high prices. Protecting their revenue base makes these companies reluctant adopters of SD-WAN and Internet-based solutions.
- So how can organizations drive down spending on the corporate WAN, while boosting performance?
- As in most markets, the essential answer is: Competition.
- The most competitive marketplaces for telecom services in the world are Carrier-Neutral Data Centers (CNDCs). Consider all your options: long-haul network; local access; Internet service providers; storage, compute; SaaS; etc. The carriers are aware that the CDNCs provide a variety of networking options and they are also aware that their competitors are only a cross-connect distance away. In one report,
- interviewed customers of Equinix, the largest retail colocation company, and found that they saved an average of 40% on bandwidth costs, as well as 60%-70% cloud connectivity and network traffic cost reduction. In one report,
interviewed customers of Equinix, the largest retail colocation company, and found that they saved an average of 40% on bandwidth costs, and 60%-70% cloud connectivity and network traffic cost reduction.
The key is to leverage CNDCs as regional network hubs, rather than the traditional model of hubbing connectivity out of internal corporate data centers.
CNDCs like to remind the market that they offer much more than racks and power as these sites can offer performance benefits as well. Many CNDCs provide private cloud gateways to improve security and latency. Internet connectivity can be superior. Contact one of our experts to learn how you can take advantage.
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