Award winning benchmarking, sourcing and transformation advisory firm, Alsbridge,
Inc., today released a report “The Truth
About Your International Networking Contract: What You Don’t Know Could Cost
You,” which shares insights on how companies can save on their telecom expenditure
by paying attention to an important and often ignored element in their
networking contracts.
Through the convergence of Voice and Data brought on by MPLS
services, Data networks now represent most companies’ largest telecom expense category. Interestingly
though, a large component of this spend is often ignored when negotiating WAN
telecom carrier contracts. Specifically, we’re talking about the local access
(last mile) connections associated with international data locations.
“The carriers have for some time proffered the notion that
the rates charged for these local access loops represent merely a pass through
charge for them,” says Ben Trowbridge, Chairman and CEO, Alsbridge.
“Though this may be hard to believe (coming from a group that charges
surcharges for everything from their cost of collecting and remitting USF to
their real estate taxes), even if we take them at their word, there is still a
large area of potential, and based on Alsbridge’s analysis real, cost variance
here.”
First off, if it’s truly only a pass through, then the
carriers have no particular incentive to get your costs as low as possible,
other than the potential fear of losing out in an RFP environment due to
non-competitive pricing. If you’re about to issue an RFP, and you’ve got a fair
percentage of international locations, the report suggests including the local
foreign carriers in the bidding. They are doing some interesting things in the
market. Furthermore, this whitepaper reiterates, in crafting your RFP you may
want to include a requirement that the bidder provide who the last mile
provider will be for your locations. In your contract, require that your
carrier conduct access optimization on an annual basis. Their network reach in
foreign countries is always changing and a year or two later may allow for
shorter more logical loops.
For further insight into this often ignored component of
networking contracts, that can help strengthen your telecom expense budget,
download the complete report TheTruth about Your International Networking Contract: What You Don’t Know CouldCost You.
About
Alsbridge Inc.
Alsbridge provides world class sourcing advisory and benchmarking services for
the CIO, CFO and CPO. We’ve helped hundreds of companies reduce
costs and get more value from their vendors. Our experienced
consultants leverage proprietary tools and information databases to identify
and engage the optimal vendors for your situation, negotiate best practice
terms at fair market prices, and improve the way you work with your
vendors. Alsbridge clients utilize the most cost effective and value
added sources globally for IT infrastructure services, hardware and
maintenance, network services, software and maintenance, application support
and development, business processes and cloud services. Alsbridge was ranked
the #1 outsourcing advisor in the world by the International Association of
Outsourcing Professionals (IAOP) based on the value delivered to
clients. This commitment to delivering value to our clients has made
Alsbridge a distinguished member of the 2010 Inc. 500 fastest growing privately
held companies in America.
