Several years ago, we had a client with a SONET ring costing them over $1 Million per year. We asked them what services were using the ring, and they didn’t know. We asked the vendor account team if they could tell us what services were in use on the ring, and THEY didn’t know. We searched through invoices for services using the SONET ring, and found just a handful of voice T1 channels plus the charges for the ring itself. We did find some MPLS and Internet circuits at the locations with nodes on the ring, but those services were using standalone access loops completely independent of the ring. After a great deal of discussion with the technical teams of both the client and the vendor, we concluded that this ring was in fact only being used for a handful of minor voice circuits, and the decision was made to move the circuits and decommission the ring. The question that kept coming up was “HOW DID THIS HAPPEN???”
The case described above is an extreme example, but since then, we have had similar scenarios play out with other clients with SONET rings, and a few themes keep recurring. So, how do customers keep winding up with expensive yet highly underutilized SONET rings in their telecom service portfolio?
Origins – Most SONET rings we encounter have been in place for a LONG time. Once upon a time, a standalone DS3 access loop could cost several thousand dollars, an OC3 could easily run $10K or more, and Ethernet was virtually non-existent as a WAN protocol. Network managers could easily justify the cost of a ring, especially since SONET was at the time the only real option for survivability. Designed primarily for high volume TDM voice services, many SONET configurations were built to provide connectivity at (and between) Corporate Headquarters and Call Centers. They could even provide a Data Center with “ample” connectivity at a DS3 or even OC3 level.
Erosion – As competing vendors built out infrastructure to capture their share of the growing data market, vendor diversity options emerged at large business locations. Adding vendor diversity outside of the SONET ring became part of the survivability equation. Ever-increasing bandwidth requirements also gave rise to the deployment of Ethernet facilities so that Customers could use these efficient and flexible high-bandwidth connections in lieu of traditional TDM. While Ethernet can technically be provided on a SONET ring, it can be cumbersome and often wastes bandwidth, so the low cost of Ethernet often made it more cost-effective to bypass the ring, even using the same vendor. Finally, the convergence of voice and data made possible with SIP Trunking and Hosted VoIP started moving its “bread and butter application” (legacy TDM voice services) away from the SONET ring.
Survival – Because of the high up-front implementation costs, most SONET contracts started with a Term of 5 years or more, and these days, anything older than 5 years is likely to pre-date most employees in what is a highly transient IT workforce. Many IT groups tell us they “inherited” their SONET ring (which in some cases have now been in place for 15-20 years) and don’t have the history. With voice and data network groups often diverging, nobody really knew who “owned” the SONET ring, so even as services were being removed from the ring, nobody felt qualified to pull the plug. If you were lucky, your SONET contract would simply auto-renew at the same rates at the end of the original Term, but we’ve seen some SONET contracts quietly expire, with rates rocketing up to list prices at anywhere from 2-5 times the contracted rates.
Under the Radar – By now, someone should be saying “If SONET rings are so expensive but nobody is using them, why wouldn’t somebody say something?” As mentioned earlier, SONET deployments typically connect Corporate Headquarters, Call Centers, and Data Centers. Many companies operate different business units or locations as standalone profit/loss centers, and often these centralized, shared charges get allocated out to a variety of different cost centers. Once it’s divvied up into bite-sized pieces and the individual cost center sees their small share, it’s easy to shrug it off as “corporate overhead” even if they don’t know what it’s for.
Solution – If you still have SONET rings in place, there’s a VERY good chance that there’s a better way, even without sacrificing security and/or survivability. Advocate can help you figure out what’s up with your current SONET ring(s) and what to do next.