Branch Office Networking
An IT Business State-of-the-Market Brief
by Jim Metzler
Published May, 2004; Posted May, 2004
Abstract:
Branch offices are key to the success of virtually all companies. That follows in part because branch offices typically provide a critical touch point between a company and its clients.
However, branch office networks can be extremely expensive to create and maintain. For example, consider a hypothetical company Acme, Inc. Assume that Acme has 100 branch offices, that Acme has a link from each of these branches to a central data center, and that Acme is looking to upgrade its branch office network.
Further assume that when Acme creates a business case for any IT project it uses a 36-month time lifecycle. Given that Acme has 100 branch offices and uses a 36-month lifecycle, this means that every dollar of monthly recurring cost in a branch office is multiplied by 3,600 (i.e., 100 branches x 36 months) in order to calculate the Total Cost of Ownership of the upgrade to the branch office network. Hence, if the upgrade results in an incremental recurring cost of merely $100/month/office, this results in an incremental cost of $360,000 over the three-year life of the upgrade.
Given the great expense that is associated with branch office networks, Ashton, Metzler & Associates (AM&A) performed market research to better understand the dynamics that surround this component of IT. In order to perform this research, AM&A surveyed the subscribers to Webtorials, the computer-networking industry’s premier educational Web site. Throughout this document, the IT professionals who responded to this survey will be referred to as The Survey Respondents.
The survey focused on a number of topics, including the:
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Applications that are either currently running, or soon will be running, over branch office networks |
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Networking functionality that either currently exists in branch office networks, or will exist in |
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the near term |
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Role that traffic management plays in branch office networking |
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Changes that are occurring within data centers |
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Degree to which a company’s telecommuters are satisfied with their current connectivity options |
Throughout this document a number of conclusions are drawn relative to the changes that are happening in the marketplace.
About the Author:
Jim Metzler is a principle in Ashton, Metzler & Associates, a consulting firm that focuses on leveraging technology for business success. During his career, he has worked in virtually every major segment of the IT industry. Jim is also co-founder of IT Business.
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