Tracking telco tremors
In this era of economic instability, it pays to keep a watchful eye on the financial health of your providers
Follow @infoworldTHIS WEEK I'M writing about something boring and unsexy, but important to the success of your company: the risk of doing business "over the wire" in the current economy. We write frequently in InfoWorld about the growth of the xSP market, Web services, and outsourcing in general. Outsourced services are facts of IT life now, and many services are delivered and/or managed "over the wire." The CTO's role is increasingly that of a broker assembling and integrating various technology services for customers. The base assumption in a lot of cases is that the connectivity is always there.
The problem is that keeping the data flowing can be a difficult management challenge because most telco providers are in dire financial straits. At InfoWorld, our extended enterprise consists of a headquarters, four branch offices, and more than a dozen home offices. We are all connected via various DSL and T1 providers. The remote workers use a VPN to securely access data and services in their home offices. Pretty simple stuff.
Just last week, I learned that the reseller for all of our DSL services has not been paying the back-end provider on time, so our service was shut down for two branch offices and many home offices. Meanwhile, our Web hosting provider filed for bankruptcy. To top it all off, the datacenter that delivers WAN connectivity to our headquarters notified us of its closing. In short, every wire connecting us to each other and to the outside world is connected to a company that is under extreme financial duress at the moment. Pick up The Wall Street Journal and read about the telco industry and you can see that InfoWorld is not alone. It's very difficult to keep all those wires up in the current economy. Everything listed above happened in one week.
What does this mean for emerging Internet technologies such as Web services? Back in January, I wrote about the keynote that James Gosling gave at InfoWorld's Web services conference. In that speech, he referenced Peter Deutsch's "Fallacies of Distributed Computing" as follows: 1) The network is reliable; 2) latency is zero; 3) bandwidth is infinite; 4) the network is secure; 5) topology doesn't change; 6) there is one administrator; 7) transport cost is zero; and 8) the network is homogenous. To that list, I'll add No. 9: The provider of your bandwidth and connectivity is financially stable and will be there forever. For Web services technologies to be successful, the telco industry must stabilize or we are in for a lot of disruptive technology, of the worst kind.
When the base level of infrastructure can be so unpredictable, what does a CTO do? As tedious, internally focused, and operational as it may be, CTOs need to continually evaluate their telco providers' financial situations and take appropriate action. I am now planning to speak with each of my vendors on a monthly basis (at the very least) to talk about the state of their businesses. It's easy to get lulled to sleep by the fact that you have done business with a provider for a number of years, but the end can come swiftly. Don't be surprised by anything.
