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Vab Goel (Virtela): Enterprise Networking: The Venture Capitalist and Global Operator’s Perspective. It’s all about “consumers” to analysts (same ones who wrote “consumers” off not very long ago).
Vab also works with Norwest Venture Partners ($3.7B in capital, funded >450 companies, including successes PeopleSoft, Tivoly, Verio, Rackspace, Polycom, Brocade). Smaller start-ups have difficulty trying to differentiate their services (LifeSize: telepresence, QUMRANET: virtualization, Yipes: ethernet, Spinnaker: storage, RackSpace: cloud computing, Winphoria: softswitch, Cerent: optical nets, Airespace: wireless LAN; many companies acquired by larger companies). Good advice to VC: work with smaller companies if they have a good service, don’t worry if you think they’re going to get bought.
Noone is talking about enterprise networks: they all need to be connected. Average revenue around world is exploding, consolidation of service providers has created “herd” mentality, lack of new and innovative services. Many service providers continue to rely upon equipment providers to define new services based on equipment features and functions. (oh oh.) Hard to differentiate services. Pricing is NOT the only difference, not a winning strategy. Service providers must offer services based on customer needs; 50-100x per Mb extra revenue potential with managed services.
State of global network partnerships: old alliances are gone. Leading partners (BT, Orange, AT&T, Verizon, etc.) now aggressively moving into former partners’ home territories. Former local and regional alliance partners need new partnership models. Global market reality: distribution varies widely, no single provider has end-to-end network, global customers want single point of contact. Managed network services reduce churn. CIO has fewer service provider choices, application performance is CIP’s top priority–they want innovation.
Emerging end-user computing environment: single vs simultaneous multiple apps for same job, convergence of buisness and consumer applications. CIO’s dilemma: where’s control of network and apps? how to measure global application response time vs network uptime? Benchmarking against performance at home. How do we provide better support, and do more with less budget? Customers care about uptime. Virtela has a super-integrator model.
Question re: large enterprises don’t tend to innovate (lot of policies, protecting existing hardware). Need to hire the right talent for leadership.
Question: Bringing more revenue to partners: Virtela does not have fiber or leased lines, we work with partners. Requires quick turnaround and good support.
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