All Rights Reserved © Alcatel-Lucent 2010 1 | Presentation Title | 2010 Dominique Verhulst October, 2010 Insourcing Enterprise WAN : Gaining flexibility

All Rights Reserved © Alcatel-Lucent 2010•1 | Presentation Title | 2010

•Dominique Verhulst

•October, 2010

•Dominique Verhulst

•October, 2010

Insourcing Enterprise WAN :

Gaining flexibility and saving costs with IP/MPLS


Agenda

1. Some Definitions

2. The Enterprise WAN Challenges

3. WAN : Insourced vs Ousrourced

4. Alcatel-Lucent WAN Solution

5. Customer Examples

6. Conclusion


Some Definition1Setting the stage


What is MPLS and Where does MPLS play a role ?

MPLS is a transport technology.

MPLS allows transport of TDM, IP or Ethernet traffic

MPLS can be transported over Ethernet or a Layer 2 protocol (PPP, …)

WDM or SDH / optical or MWWDM or SDH / optical or MW

EthernetEthernet PPP, …PPP, …

MPLSMPLS

IPIP EthernetEthernet SDHSDH

Eth Switch

Eth Switch

MuxMux

IP Router

IP Router

Voice, Video, DataVoice, Video, Data

PBXPBX PBXPBX

MPLS SwitchMPLS

Switch

All Rights Reserved © Alcatel-Lucent 2010•5 | Presentation Title | 2010 5 | 7750 SR Overview

What are those trends leading to ?

Today, an enterprise has 2 choices to build an infrastructure to interconnect sites:

Native IP

MPLS

IPIP IP / MPLSIP / MPLS

Zero Downtime Convergence time around 5-10sec <50ms failover

Security Not traffic isolation in the core Traffic isolation (VPNs in the core)

Enhanced QoS Yes Yes (same as Ethernet enhanced with

traffic engineering)

Unified networks IP application only can be

transported (or through complex

tunneling)

IP and non IP (TDM, …), can be

transported. Multiservice support.

Standard

technology

Can Use Ethernet end to end in

the backbone

Can Use Ethernet end to end in the

backbone.

All Rights Reserved © Alcatel-Lucent 2010•6 | Presentation Title | 2010 6 | 7750 SR Overview

What are those trends leading to ?

Today, an enterprise has 2 choices to build an infrastructure to interconnect sites:

Native IP

MPLS

IPIP IP / MPLSIP / MPLS

Zero Downtime Convergence time around 5-10sec <50ms failover

Security Not traffic isolation in the core Traffic isolation (VPNs in the core)

Enhanced QoS Yes Yes (same as Ethernet enhanced with

traffic engineering)

Unified networks IP application only can be

transported (or through complex

tunneling)

IP and non IP (TDM, …), can be

transported. Multiservice support.

Standard

technology

Can Use Ethernet end to end in

the backbone

Can Use Ethernet end to end in the

backbone.


The Enterprise WAN Challenges2


Attract Customers Increase the Bottom Line Innovate Deploy architectures

Make Money Understand the Facebook Generation Target New Markets Invest in new Technologies Gain Market Share OutPace the Market Resist to Competition Be Green Cope with Save Money Address Emerging Markets Understand Customers Needs Invent New Products & Services Report to the Financial Market Execute faster than the othersBusiness Imperatives offer an opportunity to rethink how to deliver on

the priorities

Business Imperatives


The Wide-Area Network becomes a Key Asset

Cost Reduction Programs

Data Center Consolidation and Global Network Unification

Data CenterHQ

Branch

Regional Office

IPT

CommunicationApplications

BusinessApplications

Reduced CAPEXReduced OPEXReduced Real Estate CostsHigher FlexibilityIncreased Service Sophistication

Reduced CAPEXReduced OPEXReduced Real Estate CostsHigher FlexibilityIncreased Service Sophistication


Drivers for WAN Projects

Unified comm & collaboration

Unified comm & collaboration

Increase Data

center resiliency

and flexibility

Increase Security for data protectio

n and complian

cy

Enabling new IP applications

Network consolidati

on after

organic growth or

M&A

VoIPVoIPCRMCRM

ERPERPWeb servicesWeb services IP Contact Center

IP Contact Center

Video

conferencing

Video

conferencing


Challenge 1 : Network consolidation after organic growth or M&A

A new acquisition always requires very fast ROI from all departments.

IT integration can be very long, but needs at least a network integration.

Impact on an IP Network : integration becomes immediately complex because of

Overlapping IP addresses

Security rules required

This can take several month before triggering the use of the same infrastructure

Impact over an IP/MPLS Network :

Integration can be fast, immediately generating immediate cost savings on bandwidth.

IT integration can be the second phase


Challenge 2 :Enabling new IP applications

The R&D department launches a new application.

The IT network department needs to rethink all the prioritization model, taking in account :

Characteristics of the new application (bandwidth, protocols, …)

Existing application quality of service model and existing bandwidth

Impact over an IP Network :

classification of ALL applications, a reconfiguration of ALL rules.

Impact over an IP/MPLS network : the hierarchical QoS model allows to :

Maintain QoS model between departments (ie R&D vs Sales)

Modify rules within R&D applications only


Challenge 3 :Data Center Flexibility

Many revolutions have happened recently with complex impact on network.

Server Clustering, Server Virtualization

What’s next ? SAN integration, …

What do they share ? A requirement for a seamless High performance LAN across Data Centers (Layer 2 transport).


Come back to last century’s technology (Spanning Tree), with no control and inadequate failover times.

Impossible over an outsourced network.

Impact over an IP/MPLS network :

Embedded transparent Layer 2 services (Virtual Private Lan Services)


Challenge 4 :The Security Challenge

More and more control needs to be put on the network, in order to prevent data and applications from internal and external threats.


One router = One need for protection (internal ACLs, internal FW, external FW).

Security rules are very dispersed and management … a nightmare

Impact over an IP/MPLS network :

Limited needs for ACLs, thanks to embedded traffic separation.

concentrate FWs in fewer locations, simplifying management thanks to VPN backhauling capabilities


WAN insourced vs Outsourced3


Current WAN Pains

COSTS SERVICES AVAILABILITY

AGILITY AND FLEXIBILITYCOST-EFFECTIVE NETWORK

REDUNDANCY


Wide Area Network : External or In-House ?

The Real Debate is owned versus Shared ot in-sourced vs out-sourced Network

Source : IDC 2009 Source : IDC 2009

•Satisfaction with Managed IPVPN Features Overall

•Connexion type of all sites in the study


In-Sourcing Enabler – Access Technology Availability

To insource service, requirement is to buy point to point links.

Fiber is present between large cities across the world

Transparent Layer 2 services are available eveywhere.

It is possible to buy a mix of point to point links.

Do not rely on a single carrier (security)

Use the best carrier for each connection (metro, nation, international)


Tailored Network – Advantages and Drawbacks

ROI 12-18 Months – WAN OPEX cut by 20-30%

Advantages

WAN Costs cut

Increased bandwidth

Quicker Moves, Adds, Changes

Full QoS/Security control

Security by design

Easier security

Higher availability

Multi-carrier redundancy

Drawbacks

CAPEX (MPLS routers)

OPEX (build, train and maintain dedicated WAN team)

Risk & responsibility in-sourced (could be outsourced)


ROI Calculation from Customer Example

Customer with 5,000 employees in 24 offices across 15 countries

Project Drivers : SAP Implementation, WAN Costs Reduction

Outsourced WAN Costs / Year

IP-VPN WAN Carrier 2,000,000 €

MPLS Equipment CAPEX 0 €

In-House WAN Team 0 €

Equipment installation 0 €

Service activation 0 €

TOTAL2,000,000

€

Insourced WAN Costs / Year 1

Ethernet over SDH links * 1,000,000 €

MPLS Equipment CAPEX 600,000 €

In-House WAN Team ** 400,000 €

Equipment installation 60,000 €

Service activation 85,00O €

TOTAL2,145,000

€

* Bandwidth X 4 ! N+6 Link redundancy* Bandwidth X 4 ! N+6 Link redundancy

** NOC + Helpdesk** NOC + Helpdesk14 MONTHS !14 MONTHS !

30% WAN COSTS SAVINGS / YEAR30% WAN COSTS SAVINGS / YEAR


«G.E.A.R » methodology to Implement your MPLS private network

Financial collect

Applications & sites & Data-centres Constraints

Objectives & Priorities

Financial collect

Applications & sites & Data-centres Constraints

Objectives & Priorities

Set of Workshops

Solution-Design

Transformation route

Operation/NOC

ROI & budgetary quote

Set of Workshops

Solution-Design

Transformation route

Operation/NOC

ROI & budgetary quote

Transformation

Guidelines

Milestones

Program managemen

t

Transformation

Guidelines

Milestones

Program managemen

t

Security control

Sites & Data-centre

Implementation

NOC activation

Redundancy tests

Pilot phase

Financial Follow-up

Security control

Sites & Data-centre

Implementation

NOC activation

Redundancy tests

Pilot phase

Financial Follow-up

•Gather Engage •Act •Roll-out

•By the customer •Customer withBP + ALU

•BP + ALU•BP + ALU

REQUIREMENTS

Financial

proposal

Financial

proposal

GO / NOGOGO / NOGO


The Alcatel-Lucent WAN solution4


Alcatel-Lucent IP: Unmatched Market Momentum

2003

#2 Worldwide

IP/MPLS Edge

Routing

#2 Worldwide

IP/MPLS Edge

Routing

>$3Bn Installe

dBase

>$3Bn Installe

dBase

45,000+ systems shipped

45,000+ systems shipped

>40 networks with 100+ Routers

>40 networks with 100+ Routers

20102004

2 product

s

2 product

s

1% market share

1% market share

$37m Installe

dBase

$37m Installe

dBase

1,100 system

s shippe

d

1,100 system

s shippe

d

ConvergenceMobileIP

TriplePlay

VPNs

>300 customers

>100 countries

11 customers

8 countries

Rapid

Revenue Growth

Unified Management

platforms

Unified Management

platforms

Creation of

IP Division

Creation of

IP Division

5 product families13 products

5 product families13 products

5620 SAM5620 SAM

5650 CPAM5650 CPAM

5750 SSC5750 SSC

5670 RAM5670 RAM


Alcatel-Lucent’s Award-Winning Service Router Portfolio

24 | IPD Marketing | March 2010

2009 Winner

Best Carrier Ethernet Switch/Router

Infrastructure(SR Portfolio)

2009 Winner

100 GE on the

Service Router Portfolio

2009 Winner

Vendor of the Year - Best

Infrastructure Product

(SR Portfolio)

2009 Winner

Best Telecom Equipment

Award(7705 SAR)

2008Winner

MetroNetwork

Technologies(FP2 Silicon)

2007 Winner

Best New Product Concept

(7705 SAR)

2008 Winner

Excellence in Technology Innovation (FP2 Silicon)

2010 Winner

Network Infrastructure

Wide Area Network(7750 SR Mobile

Gateway)

Service Router Portfolio: Award Winning Technology

All Rights Reserved © Alcatel-Lucent 2010•25 | Presentation Title | 2010 25 | 7750 SR Overview 25 | IP PD Enterprise and Vertical Markets | 2009

Alcatel-Lucent IP/MPLS Portfolio

1 Tb/s

7750 SR-7 7750 SR-12

500 Gb/s40 Gb/s18 Gb/s12 Gb/s 90 Gb/s

7750 SR-c127750 SR-c4

320 Gb/s

7450 ESS-67450 ESS-1

7450 ESS-7 7450 ESS-12

Multiservice edge routing

Metro service

edge and aggregation

Unified management

5620 SAM, 5650 CPAM,

7750 SR-1

7210 SAS-E

half-duplex

7705 SAR-8

Common SR OS across portfolio

7450 ESS-6v

2 Gb/s

7705 SAR-F

7210 SAS-M

7210 SAS-X


Alcatel-Lucent Complete WAN Solution

Campus Main Building

Branch OfficeData Center

Private WAN/MAN

Factory

Simple deployment w/ carrier-class, easy-to-use, end-to-end, best-in-class provisioning system

7210 SAS

7750 SR

7750 SR

7750 SR

OmniAccess /OmniswitchOmniSwitch

10000 OmniSwitch 9000E

7750 SR

OmniSwitch 6855

Alcatel-Lucent invented VPLSSegregates Traffic

Increases ResiliencyEliminates BGP

Ethernet or SDHHitless UpgradeFast Re-route

H-QoS

OmniSwitch 6400/6850

7705 SAR


Video VideoVoice Voice

DataDataIP/MPLS

OAM Tests

Service Assurance Tests

5620 SAM

Service Provisioning

Easy Provisioning and Troubleshooting with 5620 SAM

5620 SAM allows for end-to-end provisioning of individual servicesService-Aware Provisioning and OAM leverage the concept of “Service” Routers


Customer Examples5


Finance – WAN In-sourcingWAN Costs cut by 30% - Higher Network Flexibility

Reduce complexity & cost of Service Provider VPN Implement faster new security policies & network changes Offer new services to affiliates (multi-tenants)

Centralised ICT services, SAN, eLearning

MPLS network managed in-house for main offices Maintain L3-VPN for small branches Implement VLL, VPLS for new services – SAN, Video, Webcast,

Disaster recovery, IP Telephony

Reduce costs by 30% (replacement of outsourced VPN) Faster implementation of new security & compliance

rules New innovative services to business lines

??Challenge

s

Solution

Benefits

Banco Santander – Portugal650 Branches, 17 main offices


Services – WAN In-sourcingWAN Costs cut by 30% - Higher Network Flexibility

•support the deployment of a lot of new applications

•provide us the full control on our IT

•Improve performance and availability

MPLS network managed in-house Implement VLL, VPLS for new service or VPRN Include all applications : Corporate Tools, Corporate ERP,

Communication tools

ROI over 14 months Avarage Availbaility grew from 96.4% to 99.8% New innovative services to business lines Increased bandwidth with cost decrease

??Challenge

s

Solution

Benefits

Large SI – Europe35 main offices


Healthcare – WAN In-SourcingWAN agility enables collaboration between hospitals

Merge the three different campus LANs into a single LAN Limit complex configuration changes driven by growing

number of sites / users / applications Limit topology changes (Spanning Tree issue)

Affordable MPLS core network with 3 x 7710SR run over dark fiber

5620 SAM service provisioning GUI managing also existing LAN switches (OS6850)

VPLS, VLL, full MPLS redundancy, Traffic Engineering

Optimized bandwidth on WAN links Fast provisioning and troubleshooting of new services Full redundancy and easy upgrades without service

interuption

??Challenge

s

Solution

Benefits

Three hospitals in three cities in Luxemburg640 beds, 230 doctors, 1,700 employees


Conclusions6


Conclusion

Banks

Insurance

Trading

Banks

Insurance

Trading

Army

Police

Civil Protection

Army

Police

Civil Protection

Highways

Railways

Airports

Highways

Railways

Airports

Electricity

Water

Oil / Gas

Electricity

Water

Oil / Gas

Citynets

Education

Hospitals

Citynets

Education

Hospitals

Defense &

Security

Defense &

SecurityFinanceFinanceTransportationTransportationEnergy & UtilitiesEnergy & UtilitiesGovernment

Tailored WAN is a real answer to the entreprise challenges

IP/MPLS brings more than what is available as outsourced offerings

More than 150 new IP/MPLS Enterprise / Government Customers

Alcatel-Lucent and Business Partners have extensive experience in these markets


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All Rights Reserved © Alcatel-Lucent 2010 1 | Presentation Title | 2010 Dominique Verhulst October, 2010 Insourcing Enterprise WAN : Gaining flexibility