Execs embrace IP-based convergence

NETWORK WORLD NEWSLETTER: CAROLYN DUFFY MARSAN'S ISP NEWS REPORT
10/26/05
Today's focus: Execs embrace IP-based convergence

Dear networking.world@gmail.com,

In this issue:

* More corporations are migrating to IP-based converged nets,
??but cost, security concerns remain
* Links related to ISP News Report
* Featured reader resource
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Today's focus: Execs embrace IP-based convergence

By Carolyn Duffy Marsan

Editor's Note: On Nov. 9, the ISP News Report newsletter will
change its name to Service Provider News Report. In the
newsletter each week, Carolyn Duffy Marsan will continue to
bring you news, views and analysis of IP services from carriers
and ISPs, but with a new newsletter name. Thanks for reading!

More corporations are migrating to IP-based converged networks,
but concerns about run-away costs and security threats remain.
These are the key findings of a survey of more than 200 global
executives conducted this summer by the Economist Intelligence
Unit (EIU) for AT&T.

"It's a fairly positive picture that our research paints about
convergence, but it's balanced by some sobering conclusions,"
says Denis McCauley, director of global technology research for
EIU, the business information arm of The Economist Group,
publisher of The Economist.

"Convergence is certainly gaining momentum and corporate
expectations of the value-added benefits of convergence now
equal or outweigh the cost efficiencies expected," McCauley
says. "But it's not all smooth running. Implementation barriers
remain in terms of security and cost. And these implementations
require changes to business practices that are beyond the
network."

EIU has conducted a survey for AT&T on the attitudes of
corporate executives toward networking and business strategy for
each of the past three years. The 2005 survey, which was
completed in June, included interviews with 236 global
executives, half of whom were CEOs, CFOs or CTOs. Survey results
were released last week.

The 2005 survey showed a significant rise in the number of
companies moving toward network convergence. In 2005, 25% of the
survey respondents said that most or all of their organizations
had implemented network convergence. This figure is up from 15%
in 2004.

An additional 62% of the respondents in the 2005 survey said
they expected that most or all of their organizations would
implement network convergence within the next three years.

"This suggests an acceleration of the migration to IP networks
within enterprises," McCauley says, adding that this survey
result is "very positive."

However, McCauley says that enterprises are taking a
step-by-step approach to network convergence rather than
migrating their entire enterprises in one big upgrade. "Survey
respondents are taking a cautious approach to IP-based
convergence," he adds. "This is very much the case this year as
well as last year."

EIU's survey found that many corporate executives understood the
importance of network convergence as a means of meeting broader
business goals. Convergence was viewed as important or critical
to the achievement of their firms' strategic IT or business
objectives by 45% of survey respondents.

"This points to a shift in executive thinking about
convergence," McCauley says. "They're not just thinking about
streamlined network management or reduction of costs...There seems
to be an increasing emphasis on using converged networks to
innovate and to add value."

In the 2005 survey, respondents ranked improved customer service
and better collaboration with suppliers, partners and customers
as more significant benefits of network convergence than lower
telephony costs, which had previously been the key driver.

Survey respondents noted the following benefits of convergence:

* 73% cite better collaboration with customers, suppliers and
??partners.
??* 69% mentioned better customer service as a critical payoff.
??* 68% cite lower network management costs.
??* 67% see a benefit in simplified network management.
??* 67% identified better-quality communications.

Despite the promise of converged networks, corporate executives
are wary about the costs of implementation as well as the
security risks associated with converged IP nets. McCauley says
widespread adoption of Multi-Protocol Label Switching technology
may help alleviate executives' concerns about IP security.

Survey respondents identified the following challenges to
convergence:

* 64% see network security issues as a barrier to
??implementation.
??* 62% expressed concerns about network availability.
??* 47% expressed concerns about voice quality over an IP network.

"Network security issues ranked right up there with
implementation costs as the most significant barriers to
converged networks in [the respondents'] enterprises," McCauley
says. "Corporate executives have jitters about greater hacker
activity as well as the spread of viruses."

More details about the EIU survey are available in a new report
called "Competing Through Convergence," which is available at:
http://www.att.com/presskit/eiu.

The top 5: Today's most-read stories

1. Cisco talking IP-radio nets
http://www.networkworld.com/nlisp9603
2. How to respond to a security breach
http://www.networkworld.com/nlisp9715
3. School traps infected PCs in its web
http://www.networkworld.com/nlisp9353
4. Cartoon of the Week http://www.networkworld.com/nlisp9354
5. CTO: BellSouth lost 9 COs to Katrina
http://www.networkworld.com/nlisp9716

_______________________________________________________________
To contact: Carolyn Duffy Marsan

Carolyn Duffy Marsan is a senior editor with Network World and
covers emerging Internet technologies and standards. Reach her
at mailto:cmarsan@nww.com
_______________________________________________________________
This newsletter sponsored by Nortel
Building the Mobile Enterprise Online Expo

The workplace is changing rapidly. Employees need to be
untethered from their desks while remaining connected and
accessible. This online event helps you solve your enterprise
mobility challenges by bringing together industry leaders,
including Nortel's CTO and CIO and RIM's VP Enterprise Systems,
to discuss the hottest topics in enterprise mobility. Broadcast
live to your desktop on Nov. 8, 2005. Register today!
http://www.fattail.com/redir/redirect.asp?CID=117974
_______________________________________________________________
ARCHIVE LINKS

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FEATURED READER RESOURCE

GRID TAKING SHAPE IN THE ENTERPRISE

Grid computing continues to gain ground and vendors such as IBM,
Platform Computing, Sun, SAS and Univa are launching services,
products and partnerships to support this growth. But will
challenges such as software licensing, security and bandwidth
issues hinder grid rollouts? Click here for more:

http://www.networkworld.com/news/2005/101005-grid.html
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