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Technology Stocks : MRV Communications (MRVC) opinions?
MRVC 9.975-0.1%Aug 15 5:00 PM EST
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To: signist who wrote (13504)5/17/1999 10:26:00 PM
From: Sector Investor  Read Replies (1) of 42804
 
Operational Overhead

Switching and port density requirements needed to meet the exponential data growth are forcing service providers to knit together a number of disparate routers and switches, each of which must be separately managed and maintained. This quickly translates into a network management and operational nightmare.

Operational components include technology evaluation, testing, installation, maintenance and administration. Given the lack of any built-in scaleability in today's architectures, service providers have to spend a substantial percentage of revenues to upgrade the backbone infrastructure every 12 to 15 months.



Today's complex core network infrastructure has a number of sophisticated cell and packet technologies such as ATM and IP. A service provider needs domain experts for each of the technology areas to face the day-to-day operational challenge. Increasing the number of disparate non-scaleable network entities demands more expert man/hours, which translates to an ever-increasing network management budget.

The number of expert man/hours needed to keep up with the separately operated network nodes and their regular maintenance and upgrade schedules will increase at a faster pace than the capacity of the network. Since operational costs can run as high as 80% of total expenses, this has become the most important concern of the service providers.

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