2 MIN READ | Service Assurance

Two Keys to Maximizing Carrier Ethernet Service Revenues

Christopher Cullan
Jan. 27 2015

The Carrier Ethernet market is a proven revenue-driver for communications service providers (CSPs), and by all accounts, it will continue to be so in the coming years. By 2017, the Carrier Ethernet market is expected to be worth $100 billion, and by one year later, revenue from these services is predicted to be 300 percent higher than it is now.

For some CSPs, such as Cable MSOs and competitive carriers, it offers new business opportunities and may sound like a windfall for the industry, but for many, it's at the expense of high-margin legacy TDM services. Regardless, all are being motivated by the same core driver, time-to-revenue.

As I explained during the Metro Ethernet Forum (MEF) GEN14 panel, "Unlocking Revenues with Standardized Carrier Ethernet 2.0 Wholesale E-Access Services," the key to demonstrating and differentiating the value of Carrier Ethernet services begins with standardized performance visibility. The visibility maximizes the value of the service to business customers and the standards optimize the cost-effectiveness and delivery times, ultimately accelerating time-to-revenue.

In this video, I explain how visibility defines the customer experience. I explore a shipping company's case study, in combination with a personal story of ordering a guitar for my daughter's upcoming birthday and tracking the delivery all the way to my doorstep. These examples parallel the importance of Carrier Ethernet performance visibility and how it impacts the value of a service:

It's this same simple visibility I described in the video — the ability to login and see data right away — that business customers crave. As our “Pulse of the CSP Market” survey found, 70 percent of CSPs say their customers would value more sophisticated reporting.

The other piece of the puzzle, in addition to visibility, is MEF's Carrier Ethernet standards, which help bridge the gap between what customers want — real-time data, self-service analytics, historical insights and more — and what CSPs actually give them. There's also a clear revenue play that can't be overlooked. If these standards help CSPs establish faster time-to-revenue for business services and simplify network and service performance management, then customers will value the service more. And if they value the service more, they'll be willing to pay more for it.

By aligning industry standards with enhanced performance visibility, CSPs can position themselves to improve their time-to-revenue and get the most out of the burgeoning Carrier Ethernet market.

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