Light Reading

Enterprise RFPs Are Up – Contracts Not So Much

Carol Wilson
10/9/2012
50%
50%

DALLAS -- Comptel Plus -- Many competitive carriers are seeing increased interest from enterprises and quotes for major network upgrades, but many of those solicited contracts are sitting unsigned for longer than usual.

The explanations for this vary, from political uncertainty to the complexity of making a major transition, such as moving to the cloud.

And those carriers that sell both wholesale services to other network operators and enterprise offerings see their network business as more stable right now.

"Our carrier business is right on target," says John Hoffman, Ethernet product manager with Tata Communications Ltd. , in an interview conducted via Tata's Chicago telepresence suite. "But on the enterprise side, we are seeing softness in general. It's not for lack of interest -- we're getting lots of RFPs, but they are signing only about 5 percent of the quotes."

Hoffman believes general economic uncertainty is the major factor -- not only from the presidential election but from the financial cuts that loom if the U.S. Congress can't agree on a debt ceiling increase, as well as from European financial woes and a perceived economic slowdown in China.

As a result, enterprises are trying to get by where they can, and only spend on what is "a guaranteed home run in terms of cost reduction or increased revenues," he says.

FiberMedia Group LLC , which is selling high-speed connections in the New York-New Jersey corridor and to data centers in Cleveland, is also seeing a longer sales cycle with enterprises, but John Panzica, senior vice president of sales and marketing, is attributing that to the higher complexity of sales, more so than economic uncertainty.

"These are complex enterprise solutions, particularly when you are talking about moving the IT spend into the cloud," he says. "The amount of scrutiny and the process behind these large complex solutions is more involved, particularly because they also involve decisions about staffing and budgets."

Beyond the network, these deals have many moving parts including the convergence of mobility, the cloud and hosted software, Panzica says, and that's prolonging the decision cycle.

tw telecom inc. (Nasdaq: TWTC) isn't seeing any market softness, but CEO Larissa Herda admits it could be around the corner if Washington doesn't resolve the budget crisis.

"Last summer, when the financial cliff was ridiculously upon us, because of the debt ceiling debate, customers did delay their buying and they may go into the same mode if it happens again," she says.

For some markets – content providers are a big one -- the wholesale traffic volume just continues to rise.

"Quoting volume is through the roof," acknowledges Greg Spraetz, senior vice president of wholesale services for Level 3 Communications Inc. (Nasdaq: LVLT), which is also seeing major growth for its services into Latin America from every other part of the globe. Sometimes the sales cycle is more prolonged, he adds, but that's often in situations where a carrier is trying to determine how to optimize its operations.

"A lot of larger carriers are looking to consolidate the number of preferred vendors," he says. "We think it helps us because we have a lot to offer as a single vendor, after the merger [with Global Crossing]. We can go in and help them do network optimizations that help a carrier with a couple of thousand enterprise circuits operate more efficiently."

Financial services has also been a growth market, particularly for those with low-latency offerings, but there is some caution in the market about future government regulation of high-frequency trading, says Joe Cumello, vice president of marketing for Sidera Networks Inc. .

"They know the government is looking at the high-frequency trading market and whether it needs to be regulated, but for now, financial services are buying, and we are finding strong growth also in wholesale and content markets," he says.

— Carol Wilson, Chief Editor, Events, Light Reading

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Flash Poll
From The Founder
Networks of the future will rely on "white box" switches and servers rather than proprietary hardware and that's going to alter the shape of the communications industry. Who says so? John Chambers.
LRTV Custom TV
The Benefits of HyperScale Clouds for NFV

3|27|15   |   01:50   |   (0) comments


Hyperscale cloud has been developed by the Internet giants to support the creation and delivery of software-based services at blistering speeds, and at the lowest possible cost. The original ETSI NFV vision was to adopt hyperscale cloud architecture and practices. This vision has become somewhat obscured along the way, due to misunderstandings about the hyperscale ...
LRTV Huawei Video Resource Center
eLTE Rapid Meets the Need for Speed

3|26|15   |   4:45   |   (0) comments


Designed especially for emergency and dedicated ad hoc local mobile communications coverage, Huawei's eLTE Rapid solution can deliver trunked voice, video and data coverage for multiple users over a 6km range and be set up in just 15 minutes, explains Huawei's Norman Frisch.
LRTV Huawei Video Resource Center
On Videos: Challenges & Opportunities

3|26|15   |   5:56   |   (0) comments


Most everything is now connected. And along with 4K and 4G technologies, everyone could be creating and broadcasting video contents. Users are expecting better video experience with any screen, anywhere and anytime. Operators will meet new challenges, but also see some big opportunities.
LRTV Custom TV
JDSU: Delivering Dynamic Networks for a Personalized Experience

3|26|15   |   5:59   |   (0) comments


Light Reading speaks to JDSU at Mobile World Congress 2015 about new solutions in the areas of HetNets, VoLTE, backhaul, virtualization, big data analytics, and real-time intelligence.
LRTV Custom TV
Smarter Service Chaining & New Ways to Benefit From Qosmos Technology

3|25|15   |   03:11   |   (0) comments


David Le Goff, director of strategic and product marketing at Qosmos, explains how the company has added application awareness to subscriber information to make service chaining more efficient and reduce costs for networking and infrastructure. In addition, Qosmos technology, which has been delivered as C libraries, is now also available as a virtual machine, ...
Between the CEOs
Qosmos CEO: The Changing Face of DPI

3|24|15   |   13:53   |   (0) comments


LR CEO and Founder Steve Saunders sits down with the head of Qosmos to talk about the changing state of the art in deep packet inspection technology, including its role in SDN and NFV architectures. Also, how the comms market is becoming more like the automotive industry.
LRTV Huawei Video Resource Center
FC Schalke Scores With Its Agile Stadium

3|24|15   |   6:23   |   (0) comments


Top German soccer club FC Schalke 04 has deployed a new, agile WiFi network from Huawei in its Veltins-Arena stadium and is reaping the benefits in terms of customer satisfaction and business opportunities, explains marketing chief Alexander Jobst.
LRTV Huawei Video Resource Center
Huawei’s Insights on Mobile Video

3|24|15   |   7:51   |   (0) comments


More people than ever are now watching videos on smartphones. Seventy percent of mobile traffic will be video traffic until 2018. In this video, Huawei's exports give their insights on mobile video in terms of business model, network planning and 4G network construction.
LRTV Documentaries
The Rise of Industry 4.0

3|24|15   |   02:26   |   (9) comments


Are you ready for the fourth industrial revolution? It's a big deal for influential operators such as Deutsche Telekom.
LRTV Huawei Video Resource Center
Getting Connected With eLTE

3|23|15   |   06:04   |   (0) comments


Trunked radio communications have entered the 4G LTE world, and with Huawei's eLTE solution, can now deliver a full range of data and video services as well as push-to-talk voice, explains Huawei's Norman Frisch.
LRTV Huawei Video Resource Center
Funkwerk’s on Track With Huawei

3|19|15   |   3:23   |   (0) comments


GSM-R technology specialist Funkwerk and Huawei have forged a partnership that is benefiting both parties, notes Funkwerk's Gottfried Winter.
LRTV Documentaries
How EANTC Tested Cisco's Virtualization Solutions

3|18|15   |   5:49   |   (0) comments


Carsten Rossenhövel, managing director of independent test lab EANTC, tells Light Reading founder and CEO Steve Saunders about the innovative approach his team had to take when validating Cisco's service provider virtualization and cloud solutions.
Upcoming Live Events
April 14, 2015, The Westin Times Square, New York City, NY
May 5, 2015, Hyatt McCormick Place, Chicago, IL
May 6, 2015, Georgia World Congress, Atlanta, GA
May 12, 2015, Grand Hyatt, Denver, CO
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 8, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 10, 2015, Chicago, IL
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
All Upcoming Live Events
Infographics
Hot Topics
AT&T Woos SMBs With Small-Scale WiFi
Sarah Thomas, Editorial Operations Director, 3/26/2015
The Rise of Industry 4.0
Ray Le Maistre, Editor-in-chief, 3/24/2015
Google Hires Wall Street's Most Influential Woman as CFO
Dan Jones, Mobile Editor, 3/24/2015
Average US Broadband Speeds No Great Shakes
Mari Silbey, Independent Technology Editor, 3/25/2015
Net Neutrality Suits: Only The Beginning?
Alan Breznick, Cable/Video Practice Leader, 3/24/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
LR CEO and Founder Steve Saunders sits down with the head of Qosmos to talk about the changing state of the art in deep packet inspection technology, including its role in SDN and NFV architectures.
Chattanooga’s EPB publicly owned utility comms company has become a poster child for how to enable a local economy using next-gen networking technology. Steve Saunders, Founder of Light Reading, sits down with Harold DePriest, president and CEO of EPB, to learn how EPB is bringing big time tech to small town America.
Cats with Phones
Interspecies Phone Love Click Here
"No, you hang up."
"No, YOU hang up."
Latest Comment