Gartner: Early NBN to add complications for enterprise customers

Gartner: Early NBN to add complications for enterprise customers

But reseller opportunities across the new open-access network will abound

The early years of the Federal Government's National Broadband Network (NBN) may spell chaos for enterprise network buyers unaware of the commercial models and capabilities, a new report claims.

Enterprise network procurement is more sophisticated than consumer purchasing and is commonly done through negotiable customised agreements and impelled by engineering considerations. Today, companies buy from carriers and generally have a one-on-one relationship with them.

But Gartner predicts services across the NBN’s open-access network (OAN) model will be sold at basic wholesale capacity. The analyst group said it would then be up to reseller telco providers to mould services into distinctive product offerings.

Research vice-president, Geoff Johnson, who compiled Gartner’s new Early Lessons in Buying Enterprise Network Services From OANs report, said the infrastructure wholesale arrangements dictated by NBNco meant competition will rest less on pricing issues and more on differentiators resellers could offer. These could range from variations in service level agreements (SLAs), management tools and layer 2 or 3 complementary services.

Johnson acknowledged resellers would therefore play a key role in guiding enterprises through the intricacies created by the NBN.

“Resellers are going to be helping businesses work this out so they really need to stay abreast of what the NBN’s OAN structure will mean to their customers,” he said. The NBN and Telstra’s imminent separation also provide fertile grounds for more telco players to join the game, he added.

Gartner expects to see four classes of services offered across the NBN at varying price points depending on the quality of service:

  • Class A: Real-time – for videoconferencing and so on.
  • Class B: Near-real-time – for IPTV and enriched data streaming
  • Class C: Mission-critical – for data communications traffic
  • Class D: Best-effort –for Internet access, and so on.

Johnson also advised enterprise buyers to better understand how services are delivered to them. For example, adequate attention needed to be paid to prospective vertical industry solutions, interfaces, standards and limitations of OANs.

“For the first two to three years, enterprise buyers are going to have to look at what resellers get from the wholesaler and how they are turning that into enterprise services,” he said.

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