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CIOs Call
for Managed
In the current global economy, the business
case for predictable, reliable and cost-
effective managed services has never been
stronger. Here’s why.

nstead of building and managing a video surveillance system leading service providers are delivering next-generation managed
on its own, Washington’s Kent School District is considering services to their customers.”
another option: Outsourcing the potential project to a managed Cisco’s Integrated Services Routers (ISRs) paved the way for
service provider. many of today’s managed services. Millions of those ISRs are
“All schools want to provide a safe and secure environment running in customer sites across the globe. Now, service providers
for all of their students, but not all can afford the expertise or are layering managed services onto those routers—enhancing
infrastructure to support it,” says Thuan Nguyen, executive the security, reliability and productivity of customer networks.
director of IT for Kent School District. “Most schools can’t even Still skeptical? In each of the pages ahead, we focus on the
afford to have a dedicated server or network administrator, but power—and the payoff — of specific managed services across
they all want the service.” the globe. And we reveal where managed services are heading
Therein lies the business case for managed services. Across next.
the globe, organizations representing all vertical markets are
embracing managed services to achieve predictable IT costs and
enhanced IT services.
From on-premise equipment to in-the-cloud services, managed
service providers bring order to corporate IT. In fact, demand
Key Opportunities
for managed services extends from large central offices out to
Wide Area Application Services pg.2
branch offices—where 63 percent of organizations are using or
plan to use managed services in some of their branch locations, Managed Unified Communication Services pg.3
according to the Nemertes Research Group Inc. of Mokena, Ill.
Managed routers and firewall services were just the start. These Managed Mobile 3G Services pg.4
days, progressive service providers deliver wide area application Managed Video Surveillance pg.5
services (WAAS), unified communications, mobile 3G services
and video surveillance, among other popular offerings. Application Extension Platform (AXP),
“The march toward ubiquitous managed services is undeniable,” TelePresence and Beyond pg.6
Doug Ross

says Al Safarikas, senior director of managed services marketing
at Cisco Systems Inc. “Working with Cisco Systems, the world’s

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Wide Area Application Services

Consolidate Without the
Performance Penalty
hief Information Officers (CIOs) have spent our worldwide engineering staff is so excited to
more than a decade battling a technology have five-times the performance they previously
paradox: On the one hand, they want experienced.”
to give branch office workers rich, responsive Sprint has had a similar experience. By
applications. But on the other hand, CIOs don’t leveraging WAAS, Sprint reduced server and
have the budget to equip branch offices with full IT storage sprawl across 100 branch offices, and
staffs and related equipment. eliminated 3.2 terabytes of WAN data between two
The result: branch office workers often felt like main sites in a month, the service provider reports.
second-class citizens who lacked the tools and Equally important, employees across those 100
support that their central office peers took for branch offices gained LAN-like performance even
granted. though servers were consolidated across fewer
“Businesses always seemed to be searching for locations.
a way to centralize their systems without sacrificing
a great user experience in branch offices,” notes Managed WAAS Services
Ed Golod, president of Revenue Accelerators, Now that WAAS is widely proven, companies like
“Businesses always
a technology consulting firm in New York. “The TELUS offer WAAS as a managed service to a
seemed to be searching
answer to that dilemma finally presented itself range of customers.
for a way to centralize
when Cisco launched its Wide Area Application their systems without Eager adopters include Finning, one of the world’s
Services.” sacrificing a great user largest Caterpillar dealerships. Before Finning
Those services -- also known as WAAS—have experience in branch adopted WAAS, the company suffered from lost
undeniable value. From ADC Telecommunications offices.” productivity because employees sometimes drove
to Sprint, organizations are discovering that WAAS — Ed Golod, president of
between offices instead of using sluggish WAN
reduces: Revenue Accelerators connections, concedes Doug Pettapiece, director
of systems at Finning.
• Branch IT capital expenses (CapEx) and “Finning had very, very slow response times on
operating expenses (OpEx) certain applications,” recalls Stephen Dixon, a senior consulting
• Branch office employee downtime through application analyst at TELUS, which ranks among Canada’s largest service
acceleration providers. “We found a solution with WAAS. All it required was
• WAN bandwidth expenses putting network modules into Finning’s Cisco routers.”
The result was dramatically faster network performance,
In recent months, Cisco and Microsoft Corp. have partnered managed by TELUS, says Pettapiece.
to integrate Windows Server 2008 with WAAS. The result is an
appliance that offers virtualization capabilities for hosting Windows
services in branch office environments.
At A Glance
WAAS Delivers
WAAS almost sounds too good to be true. But a range of Opportunity: Wide Area Application Services
customers are true believers in the Cisco technology. Consider the Business Needs: Faster application performance over
situation at ADC, which was struggling to share CAD (computer- wide-area connections. Lower branch office IT costs.
aided design) files across its wide area network. The slow WAN
IT Solutions: Cisco WAAS Module, Cisco Wide Area
performance affected global R&D collaboration and time to market
Application Engine Series Appliances
for new ADC products.
Seeking a solution, ADC centralized its CAD applications and Sample Cisco Partner: TELUS
embraced Cisco WAAS to accelerate application performance. Sample Customers: ADC, Finning, TELUS
The results were startling. “We achieved a return on investment
in three months,” estimates Dave Brady, VP of IT at ADC. “And

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Unified Communications

Make Your Presence Known
aurie Shook has more than 4,000 offering industry-specific solutions…and ensuring that CIOs hear
reasons to believe in managed the message of mitigating risk with managed UC deployments.”
services. As portfolio leader for Verizon and numerous other Cisco partners have geared
managed unified communications at up to meet rising demand for managed unified communication
Verizon Business, Shook is shaking up the services. In one scenario, service providers use a cloud- or
world of IP communications. hosted-approach—known as the Cisco Powered Hosted
Roughly 4,200 businesses depend Unified Communication Service. In another scenario, the unified
on Verizon managed services, and a communication systems are deployed on-premise at the customer
Laurie Shook, Verizon
growing number of those organizations site—and then managed from afar by the service provider.
are embracing managed unified
communication services. Those services leverage Cisco’s Unified Benefits of Unified Communications
Communications Manager and Cisco Unified Contact Center. Enhanced productivity
The suite of Cisco tools integrates voice over IP (VoIP), instant 82% Users/Actual Benefits
messaging, conferencing and contact center applications. 64% Non-Users/
“Through managed unified communication services you gain a Expected Benefits
Simplified communication
modern, integrated application infrastructure,” notes Shook. “And 66%
IT shops also gain the ability to out-task the complexity associated
with the day-to-day management of unified communications.” Easier to prioritize
In a typical scenario, service providers can extend managed 21%
unified communications out to customers’ branch offices—without Source: Sage Research

adding branch office IT personnel or on-premise equipment.
That’s an important point: Businesses are expanding their branch Verizon, for instance, uses its own IMPACT platform to remotely
office locations by 6.8 percent annually, and only 15 percent of monitor and manage Cisco unified communication solutions.
those sites have on-site staffs today, reports Nemertes Research IMPACT (short for Integrated Management Platform for Advanced
Group Inc. of Mokena, Ill. Communications Technologies), cost Verizon $150 million to
Regardless of a customer’s location, managed unified develop. “We use IMPACT for everything from managing a
communications include: customer’s Cisco WAN routers to their IP PBXes.”
Unified Messaging - Integrates voice mail and e-mail and Another key part of Verizon’s managed services strategy is SIP
delivers greater efficiency for corporate end users by enabling (Session Initiation Protocol) trunking—a cost-saving technology that
one-source access to voice and data messages. Cisco strongly advocates. SIP trunks eliminate the need for local
Unified Mobility - Offers employees a single phone number and PSTN (public switched telephone network) gateways, costly ISDN
business voice-mail box. Employees can receive calls wherever it BRIs (Basic Rate Interfaces) or PRIs (Primary Rate Interfaces).
is convenient, and make outgoing calls that appear with the user’s “Without SIP trunking, you’d need a gateway in every one of
assigned business phone numbers. your office locations,” says Shook. “SIP trunking allows you to
Unified Presence - Delivers visibility into a user’s availability to centralize your gateway in the cloud. You save significantly on
chat by phone or instant messaging. premise equipment costs and consolidate your access points.”

Opportunity Calls
In a rare technology feat, unified communications is living up to its At A Glance
hype. Customers say their experience with unified communications
enhances their productivity, simplifies communications and helps Opportunity: Managed Unified Communications
to prioritize business deadlines (see chart from Sage Research). Business Needs: Empowers customers with unified
Forrester Research Inc., in a July 2008 research note, confirmed messaging, unified mobility and unified presence.
growing interest in managed unified communications services.
IT Solutions: Cisco Unified Communications Manager,
“Many technology decision-makers tell us that they want to rent
Cisco Unified Contact Center, WebEx
rather than buy unified communications,” wrote Forrester Analyst
Henry Dewing. “This perfect storm of change and uncertainty Sample Cisco Partner: TELUS
enables UC vendors, network service providers, and even Sample Customers: Sprint, Verizon Business
software-as-a-service vendors to win managed UC share by

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Managed 3G Services

Mobile’s Next Generation Is Here
s one of Australia’s top VARs, Mathew Dickerson
evangelizes managed services to his small business
customers—many of whom required proactive monitoring
for their remote offices.
But Dickerson doesn’t just promote managed services. He
also consumes them. Specifically, Dickerson leverages 3G
services from Telstra Corp., Australia’s largest service provider for
broadband, mobile and telecom services.
“Telstra’s 3G service is the best HSDPA [High-Speed Downlink
Packet Access] service in Australia,” says Dickerson. “And it’s a
great way to communicate with a lot of our customers with remote
offices or with our customers who are road warriors.”
Despite such praise, Telstra isn’t resting on its laurels. The
company is working closely with Cisco to offer a range of additional
managed services, including Cisco Call Manager, Cisco IP phones
and Cisco Integrated Services Routers.

Shifting Into Third Gear
Plenty of 3G service providers are making similar moves. Elisa, a “Retailers cannot afford dropped connections and
leading communications service company in Finland, launched a customers are no longer willing to wait for slow, dial-up
range of 3G services in February 2008 in partnership with Cisco. based credit card transactions. Managed 3G services
In some scenarios, Elisa services offer wireless broadband eliminate those issues.”
backup to wireline data connections, helping customers maintain — Ed Golod, president of Revenue Accelerators
connectivity if their primary network connection is compromised.
In other scenarios, Elisa uses 3G as a primary WAN access
mechanism for many of its customers, due to the unique of information and communications technology. The 3G solution
geography and lack of certain primary wired infrastructure. In provides a fast, cost-effective alternative.
a typical customer setting, the on-premise solution includes an More and more companies and service providers are following
Elisa-managed router, a 3G card and a fixed-access card. Balfour Beatty Rail’s lead. Over the past year, Axxis Technology’s
Eager adopters include retailers across Finland that need to Dickerson believes managed 3G services have moved into the
process credit and debit card transactions. mainstream. “No doubt, wherever I travel, I’m looking for 3G now,”
“Retailers cannot afford dropped connections and customers says Dickerson. “It’s not an optional managed service. It’s a must-
are no longer willing to wait for slow, dial-up based credit card have.”
transactions,” notes Ed Golod, president of Revenue Accelerators,
a technology consulting firm in New York. “Managed 3G services
eliminate those issues.”
To build out the 3G service, Elisa leveraged Cisco’s 3G
wireless high-speed WAN interface card (HWIC), which adds 3G At A Glance
functionality to Cisco’s Integrated Services Routers (ISRs).
Opportunity: Managed 3G Services
On the Right Track Business Needs: Reliable, high-speed mobile connections
Similarly, Balfour Beatty Rail GmbH of Germany and its managed that allow businesses to rapidly set up temporary locations,
service provider leverage Cisco’s ISR 3G wireless technology to or strengthen communications in their existing locations.
set up IT networks at remote sites.
IT Solutions: Cisco 3G wireless high-speed WAN interface
Balfour Beatty Rail designs and revamps railway infrastructures
card (HWIC), Cisco Integrated Services Router
throughout Germany, Austria, China and Romania, among other
regions. “Many of our construction projects take place in remote Sample Deployments: Elisa, one of Finland’s largest
areas where obtaining a wired Internet connection is a lengthy and service providers; Balfour Beatty Rail
expensive process,” says Ali Inci, Balfour Beatty Rail’s manager

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Managed Video Surveillance

Seeing the Big Picture
evin Dailey has his eye on the next big networking research director at ABI in New York. “The result is numerous
opportunity—the video surveillance market. opportunities for vendors and service providers.”
“Our demand is surging,” says Dailey, vice president
of the IP Physical Security Group at Consiliant Technology Managed Video Surveillance Services
(, one of North America’s leading solutions In fact, service providers can transform one-time video surveillance
providers focused on video surveillance solutions. “Say what you engagements into managed services contracts. The reason: More
want about the economy but we’re looking to add headcount and and more businesses lack the time and expertise required to manage
we’re considering a national footprint for our video surveillance the infrastructure and data associated with video surveillance.
practice.” “Stored video can rapidly grow from
“Stored video
And for good reason. Based in Irvine, Calif., Consiliant’s terabytes to petabytes of information,”
can rapidly grow
integration team is deploying a video surveillance system notes Ed Golod, president of Revenue
from terabytes
for Amtrak. The project—initially involving Amtrak facilities in to petabytes of Accelerators, a technology consulting
Los Angeles and Oakland, Calif.,—leverages a Cisco Video information. More firm in New York. “More and more
Surveillance System. and more customers customers will seek managed service
Once completed, the system will allow Amtrak security will seek managed providers to bring order to all that
professionals to monitor video feeds at any time from virtually service providers video.”
any place, enabling real-time incident response, investigation and to bring order to all Just ask Chris Santini, managing
resolution. that video.” director of TimeCapital Securities
Another component of the system, called Cisco Video Surveillance — Ed Golod, president of Corp., a full-service financial services
Manager, authenticates and manages access to video feeds. In Revenue Accelerators firm in Smithtown, N.Y. “We’d like to
increase our own corporate security by
blending video security with physical security such as automated
Picture This door locks,” says Santini. “But we don’t have the IT staff or facilities
Annual IP-oriented video surveillance market staff to build or maintain such a system. Ultimately, we’ll turn to a
service provider for guidance and ongoing support.”
Even small businesses will be able to leverage managed video
$13.5B 2006 surveillance solutions. As part of a $100 million global initiative,
Cisco in December 2008 intends to ship video surveillance, data
$46.0B 2013 storage and wireless office communications solutions designed
for small businesses.
Source: ABI Research of New York
Concludes Golod: “With managed video surveillance, we’re at
the start of something big.”
addition to providing virtual matrix switching to connect cameras,
keyboards and monitors, the solution stores video files and recall
them for display on either analog monitors or PCs. At A Glance
Not by coincidence, Cisco Integrated Services Routers (ISRs)
have fully integrated video surveillance capabilities. As a result, Opportunity: Managed Video Surveillance
service providers have a compelling footprint and platform to Business Needs: Allow service providers and their
deliver managed video surveillance services into remote offices. customers to monitor video feeds at any time from
“Amtrak is only one example of the video surveillance virtually any place, enabling real-time incident response,
opportunities we’ve found,” says Dailey. “When you combine investigation and resolution.
the need for public safety with priorities from the Department of
IT Solutions: Cisco Video Surveillance Stream Manager
Homeland Security, you create an environment where more and
software, Cisco Video Surveillance Services Platform
more of our clientele asks about video surveillance.”
Indeed, the worldwide market for IP-oriented video surveillance Sample Customers: Amtrak, Pechanga Resort and
solutions will surge from $13.5 billion in 2006 to $46 billion in 2013, Casino
estimates ABI Research of New York. “We’re at an inflection point Sample Cisco Partners: Benson Systems, Consiliant
in the diverse video surveillance market, because we’re moving Technology
from an analog-based industry to a digital one,” says Stan Schatt,

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From AXP to TelePresence

What’s Next In Managed Services
ervice providers—and their customers—have eagerly “Service providers
embraced managed services. But the wheels of progress have come a
continue. long way in their
What types of managed services are emerging now? The managed services
possibilities are nearly limitless thanks to Cisco’s Application offerings. As
Extension Platform (AXP). Simply put, AXP is an open developer the market and
technologies have
platform that transforms networks and the Cisco integrated
matured, SPs have
services router platform into an application platform. “This platform
become more
will open up new opportunities and spark new innovations,”
predicts Marie Hattar, vice president of Network Systems and
— Marie Hattar, VP of
Security Solutions for Cisco. Network Systems and
“AXP allows you to easily integrate the branch network, Security, Cisco
applications and IT infrastructure,” according to Anurag Gurtu, a
technical marketing engineer at Cisco.
In the 1990s, traditional developers wrote applications for
operating systems. But with AXP, they write the applications for the Concludes Cisco’s Hattar: “Service providers have come
network. As a result, AXP will pave the way for service providers a long way in their managed services offerings. As the market
to write new types of applications for their customers. and technologies have matured, SPs have become more
“If you really think about it, we’re still in the early stages of unified sophisticated. As a result, they have earned the trust of enterprises
applications,” notes Ed Golod, president of Revenue Accelerators, that rely on them for an innovative mix of services for competitive
a technology consulting firm in New York. “AXP empowers differentiation. And, the AXP platform will serve them well in that
developers to write the next generation of unified applications.” regard.”

Coming Into Focus
Meanwhile, managed TelePresence services—which deliver next-
generation video conferencing capabilities—continue to emerge Cisco and Managed Services
across the globe.
Tata Communications—part of the Indian outsourcing giant Cisco Powered: More than 300 of the most successful
—plans to set up a network of 1080p High Definition Cisco service providers around the world offer one or more
managed services that have earned the Cisco Powered
Telepresence systems in luxury hotels around the world and
designation. This means their service is delivered using
network them together, notes Heise Media UK.
Cisco networking equipment and technology and meets
Similarly, service providers such as AT&T are helping universities
market based, Cisco-defined standards of support.
to deploy managed TelePresence systems at the University of
Missouri and at other institutes of higher education worldwide. Phone: Joel Conover, 408-525-5360
And in April 2008, AT&T announced plans to deliver the industry’s Email:
first, fully managed Cisco TelePresence solution to businesses
around the globe.

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