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The UK’s broadband infrastructure is developing, through BT21CN, to provide next generation services such as ADSL2+ and pressure is increasing on ISPs to put themselves in a suitable position to provide them. Both residential and business customers want speed, resilience and flexibility at a price that doesn’t break the bank, especially in the current economic climate.

Neil Watson, Technical Support Manager

Neil Watson, Technical Support Manager

ISPs now have little choice about whether or not to broaden their product portfolios – the market has made that decision for them. What’s important now is that they determine how best to approach 21CN in order to compete and retain, if not grow, their market share. In short, they must have a 21CN strategy that’s right for their business.

Deciding the right strategy isn’t straightforward however. Right now, ISPs are deliberating over what seem to be the only two options – “Do we invest heavily in the infrastructure required to take Wholesale Broadband Connect (WBC), or take the lesser, managed option, Wholesale Broadband Managed Connect (WBMC)?”

Surely it’s a no-brainer – if they can’t afford the investment required for WBC, simply take WBMC and get on with it, yes? No, you see WBMC is not yet fully operationally available, even though some ISPs are still trialling it. In fact, the full product has been delayed and isn’t promised before the end of March 2009.

Equally significant is that delivering broadband isn’t just about ADSL2+. Service providers have to accommodate the fact that BT21CN comprises a phased rollout of enabled exchanges. That means they have to be able to deliver existing IPStream Connections alongside WBMC (or WBC)-based ADSL2+ connections.

OK, so March is just around the corner and then ISPs will be able to crack on with delivering IPStream ADSL and WBMC-based ADSL2+ won’t they? They’ll also be able to get rid of any existing Centrals and start saving on bandwidth costs? Hmmm well actually, no. To dispose of 20CN Centrals and switch all their current traffic to WBMC they need IPStream Connect. Unfortunately, WBMC consuming IPStream Connect (let’s just call it IPSC) has also been delayed. The really bad news is that it’s probably until September 2009 and, again, that’s not guaranteed.

So what does this mean? Well, an ISP choosing WBMC for its 21CN strategy must continue to run any existing Centrals alongside it to serve IPStream customers until it can use IPSC and finally(!) make the switch. Assuming its bandwidth requirement is also growing (if it’s not, there may be trouble ahead) then additional Central capacity is needed.

No problem then – crunching the numbers today – take WBMC in March, wait for WBMC consuming IPSC in September and in the meantime take on extra Centrals. Sorted! Why are you looking at me like that?

Well, because ISPs are trying to determine whether WBMC is the best route when its pricing hasn’t yet been finalised. BT Wholesale pricing for the product has been set the same as for WBC since May 2008, yet it is expected (as a managed service) to be higher. The original quoted price for WBC was revised upward before formal launch and, of course, we’re all aware that bandwidth prices were recently increased across the board (including IPSC which went up by over 30%). Furthermore, unless an ISP has additional Central capacity operational before the end of April 2009 (it can take up to 90 working days from order) it’s likely to be contracted for 12 months. Explain how that then makes economic sense to the Finance Director.

How about a couple of examples to explain ISPs’ dilemma…

Firstly, an ISP currently reaching capacity on an existing 34Mbps or 155Mbps IPStream Central. They’re aware they need to act now to meet their increasing bandwidth demands and want to provide ADSL2+ as soon as possible to grow market share. They planned to wait for WBMC but need to invest in an additional IPStream Central now that WBMC (and especially WBMC consuming IPSC) is delayed. Their analysis so far has indicated WBMC is potentially a cost effective solution for their business but they can only base this on current (unconfirmed) pricing. If they wait they will incur additional infrastructure costs and will be tied into a lengthy contract which could easily reach beyond September 2009.

A second ISP is tempted to wait even longer and see what happens with WBMC and IPSC before they commit to a strategy. They’re acutely aware that the rest of the market is already taking action and they run the very real risk of being left behind as others forge ahead with 21CN plans. Fundamentally they’re concerned that by the time they successfully implement their 21CN strategy and start to proactively market ADSL2+ services many of their customers will have already been enticed away by alternative, forward thinking providers.

The problem for both is compounded by the fact that time is already running out for the IPStream Central. BT Wholesale has already published information illustrating that it will begin withdrawing IPStream Centrals as early as six months after WBMC is operational. The clock starts ticking potentially in September 2009!

Withdrawal of IPStream Centrals

Withdrawal of IPStream Centrals

From what ISPs are telling us, it’s obvious the scenarios outlined above are realistic and that they’re urgently considering their options for 21CN. So what of our two examples? Both ISPs ideally need a wholesale provider that can already offer a 21CN solution with the characteristics of WBMC and the ability to deliver IPStream using IPSC. This would enable them to begin the transition from 20CN to 21CN and expand their product portfolio while at the same time reducing infrastructure service costs and discontinuing Central contracts. Meeting bandwidth capacity will also be a thing of the past.

Forgive the obvious sales pitch, but Entanet is the only wholesale provider currently delivering the solution. As the only non-BT company currently with WBC and IPStream Connect infrastructure in place, our EWCS (Entanet Wholesale Carrier Services) broadband enables ISPs to provide ADSL and ADSL2+ connections across the WBC platform. EWCS has three options – Fixed, Flexi and Managed Flexi – to provide alternative pricing models, meet varying bandwidth requirements and accommodate different levels of technical expertise.

If you are in a similar situation to the ISP’s outlined above or want to discuss 21CN strategy options further leave a comment below. Alternatively you can visit www.betterthanwholesale.co.uk to find out more about EWCS broadband and speak to one of our wholesale specialists today.

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