12/14/98 Internet Wk. (Pg. Unavail. Online)
1998 WL 22865981
ISP Business News
(c) 1998 Phillips Business Information, Inc.
Monday, December 14, 1998
Vol. 4, Issue: 49
GTE Weds Faithful Service, IP Access
GTE Internetworking's long-awaited virtual private network
launch is an aggressive attempt by the ISP to capture the attention of
business customers through a combination of advanced service level
agreements and innovative VPN technology.
If this service branded as VPN Advantage is successful, it will
prove the absence of adequate service level agreements was a major
stumbling block in the growth of the VPN marketplace and more ISPs
likely will follow in the company footsteps.
The 7-day-old service uses TimeStep's [NN] VPN equipment, which
other Tier 1 carriers might use. Ottawa-based TimeStep is a wholly-
owned subsidiary of Kanata, Ontario-based Newbridge Networks [NN].
TimeStep says its customers don't want to be identified because they
could lose their competitive advantage.
Cambridge, Mass.-based GTE Internetworking's roll-out differs in
two ways from traditional VPNs: First, the service is coupled with an
upgrade in the ISP's SLAs, allowing customers to choose between simple
access with lower guarantees or premium service with higher
guarantees.
Normally, ISPs raise SLA guarantees independent of value-added
services. Value-added services, however, long have been associated
with higher connectivity standards agreed to on an individual basis.
Second, GTE Internetworking's service includes device and user
authentication functions via digital certificates through GTE's
digital certificate division CyberTrust. The latter struck a deal with
Hewlett-Packard [HWP] last summer to integrate CyberTrust's certification authority software with HP's VirtualVault UNIX platform
(ibn, 08.17.98).
"What this basically means is that this service is e-commerce
ready," says Ellen Carney, telecom integration analyst at Gartner
Group [IT], a Stamford-based consultancy. "With some other services
out there, customers will have to find and implement themselves [all
these e-commerce elements that GTEI provides]."
TimeStep's Solution
The deal is crucial to TimeStep since GTE Internetworking is the
first Tier 1 carrier to publicly disclose TimeStep as its technology
supplier. TimeStep primarily targets the carrier market.
"We have been in trials with GTEI for over a year," says Fran
Pascarelo, TimeStep vice president of sales.
The deal took time because GTEI looked at a large number of VPN
vendors and probed customers to ensure they were ready for the
service. In fact, the company conducted customer research for more
than a year, says Robert McKinney, company director of VPN services.
GTEI won't disclose the total number of vendors it evaluated.
Eventually it plans to supplement VPN Advantage with equipment from
Shiva [SHVA], says spokesman John Vincenzo.
Officials at both companies refused to disclose the value of the
deal, which indicates TimeStep's equipment sales are tied to the
number of new customers GTE Internetworking signs up.
Growing mainstream awareness of virtual private networks has
allowed TimeStep to shrink its sale cycle to two to three months from
a year.
TimeStep sold GTE Internetworking a combination of hardware and
software costing about $17,500 per installation. The ISP, however,
isn't charging VPN customers up-front for the gear. Instead it offers
monthly services for $1,195 without a dedicated connection, $1,705
when bundled with a fractional T1, or $3,295 with a full T1.
An important aspect of TimeStep's deal with GTE Internetworking is Permit Director, an $11,995 service management product. Director
enables the ISP to manage thousands of VPN customers. TimeStep is
working with GTE on a new management product that would enable GTEI's
Network Operations Center services to be more scaleable.
Other pieces of the customer prem installation include
TimeStep's Permit Gate, which creates a seamless VPN tunnel over
dialup and dedicated connections. GTE is using the mid-range TimeStep
product for its installations, which supports speeds of up to 10 Mbps.
TimeStep's other products range between 4 Mbps and 100 Mbps. The 10
Mbps product costs $5,495.
To connect to the Permit Gate, clients will use software called
Permit Client ($99 for 100 users).
This setup enables GTEI to offer the VPN service to its lease
line and dialup customers, as well as those using other ISPs for
access. TimeStep products are based on the IPsec standard.
New SLAs
The interest for this new service is overwhelming, McKinney
says. Companies are expected to save more than 45 percent with VPNs
when switching to local number dialup instead of dedicated lines and
800 number schemes, GTEI estimates.
The ISP's SLAs seem to create the motivation to buy VPN
Advantage as well. The ISP's access service still is supported with a
no-outages-over-10-minutes backbone guarantee, where customers must
report incidents to qualify for compensation. GTEI credits one day to
each user's account per incident.
For VPN Advantage, GTEI launched two SLA categoies for leased
line and dialup access. Leased line SLAs guarantee 99.9 percent up-
time on the ISP's backbone, leased line and customer premises router.
Backbone round-trip latency is guaranteed to be no more than 125
milliseconds. Latency is guaranteed only on the company's backbone.
Credits are issued automatically, with GTEI paying 1 percent of the
monthly fee for every point it deviates from the 99.9 percent
guarantee.
For dialup, the ISP guarantees 97 percent busy-free dialing, minimum modem connect speeds of 26.4 Kbps 99 percent of the time. If
an industry average is better than this guarantee, GTEI promises to
beat it. Industry averages and most metrics are based on a partnership
with Inverse Technologies, which also provides dialup SLA support to
Concentric Network [CNCX] and IBM Global Network [IBM]. The service
also is monitored proactively and credits are issued automatically.
For SLA comparisons, see ibn 08.10.98).
As far as customer control, GTE Internetworking has its own
technology that allows users to watch how their CPE equipment, leased
lines and backbones perform relative to existing SLAs.
VPN Advantage users also get this service internationally,
through agreements GTEI signed with iPass for dialup roaming and
Equant [EQU] for leased line access.
VPN's Future
In the immediate future GTEI will have its hands full selling
VPN Advantage. But the future of VPN services is in expanding to
include the Web hosting applications ISPs sell, some industry insiders
say.
ISPs that host applications through their data center
infrastructure could deploy VPN solutions with servers running the
applications instead of limiting VPN deployment just to access
products such as leased lines and dialup services, says Anges Imregh,
VP of marketing with VPN vendor Red Creek of Newark, Calif.
(Ellen Carney, Gartner Group, 978/323-6903; Anges Imregh, Red
Creek, 510/745-3900; Mark Kirkham, for GTE Internetworking, 617/588-
2256; Sarah Miller, TimeStep, 613/599-3610, ext. 4563.)
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