Network managers don’t really know what kinds of service level agreements they can get from telecommunication service providers, and when they do know what they can get, they aren’t terribly interested in more than a guarantee that the network will keep working, according to a study released Thursday.
Participants “really had a hard time” giving specifics about network uptime guarantees or SLA (Service Level Agreement) features, when researchers from Sage Research Inc. in Natick, Mass., pressed 15 network managers in two online focus groups, said Jared Huizenga, a senior market research analyst at Sage.
“Part of it is that SLAs have been around for quite a while, but only in the last few years has there been any emphasis on them,” he said. Many companies established their SLAs before service providers began touting guarantees as a marketing tool, and older SLAs aren’t reviewed with frequency, he said.
Having a service level agreement, and understanding what’s in it, are two different things, though, an analyst from another firm said.
“These can be really protracted legal negotiations,” said Paul Bugala, a senior analyst at research firm International Data Corp. The executives making the agreements are often not the same people involved in the day-to-day operation of the network, leaving an information gap between the negotiators and the network managers.
Cynicism deepens when network managers have no way to judge whether or not a service provider is keeping up their end of the bargain, he said. “There is not enough information about how the service provider is delivering the service,” he said. “There’s a curtain … what has to be clear to a customer is a guarantee about latency, or throughput.”
Larger customers tend to have the in-house resources to monitor their agreements, but smaller organizations do not. And making service providers come through on the contract usually requires the customer to provide evidence of service failure.
“Most people are satisfied, but they may not have seen significant downtime, or didn’t realize that their SLA had been broken,” Huizenga said.
When asked to rate the most important elements of a service level agreement, network managers in the study chose guaranteed availability and uptime as most important, over other seemingly important service issues like latency guarantees, packet loss guarantees, and notification time for security breaches.
“What people were saying is that as long as the network was up, it’s OK,” Huizenga said. “If the end user within the company isn’t experiencing downtime … then the organization is going to say it doesn’t matter, that maybe it’s not such a big deal.”
Network availability may also rate highly on network managers’ lists because it’s obvious to check. If the network is down, then the SLA is broken.
While guaranteed quality of service may be broadly attractive, particularly to companies making money from their Web sites, service providers aren’t paying the same level of attention to every SLA customer.
“Service level agreements are really geared on this 80-20 metric, where 20 per cent of the customers make up 80 per cent of the revenue,” Bugala said. “People on the smaller end are very cynical about SLAs. They see them as a marketing tool.”
With most of the revenue from SLAs coming from a select group of first-class customers, network managers on the low end of the totem pole may feel that service providers are not quite willing to step up to bat for their customers.
The rest of the pack is left behind to fend for themselves,” said Bugala.
Sage Research, in Natick, Mass., is at http://www.sageresearch.com/.
