Get Smart About Managing Your Network Capacity

Leonard Sheahan, Senior Director of Product Marketing, Oracle

Every time you turn on the TV these days you see coverage maps. The major U.S. wireless carriers have gone to great lengths, leveraging everything from A-list actors to animated holiday movie classics to affirm their wireless network as the fastest and most reliable. Whether the ads are effective, well, only time will tell, but regardless they demonstrate the importance of network reliability in today’s age of exponential broadband and mobile usage growth. In order to keep customers satisfied, network operators must manage network capacity — both current and future — effectively. But with increased pressure to cut costs, they must also do so with an eye on the bottom line.

For the average network operator, operational expenditure (opex) is roughly 45 percent to 50 percent of its revenue, and network operations make up 45 percent of that, or more than 20 percent of revenue, according to a 2009 Yankee Group report. However, forward-looking network operators have demonstrated how they can minimize these costs by applying business intelligence to the problem of network capacity management.

The challenge with planning for, and managing, network capacity while keeping cost concerns in mind is multi-faceted. First, in many cases operators have taken a “just-in-case” approach to network builds, overinvesting in network resources to quickly address growing demand, which increases capital expenditure (capex) and often does not fully solve the capacity problem due to uneven and increasingly dynamic capacity demand across the network. In many cases, operators struggle to simply obtain end-to-end visibility of their network capacity utilization, which might span multiple networks and inventories, in order to optimize resources.

On the other hand, if the operator does not have enough capacity to meet demand or isn’t able to route traffic and allocate assets effectively, it may have to rely on costly third-party leased capacity. Or, the operator may fall into a pattern of reactive capacity management, which puts it at high risk for outages and customer churn.

There has been a push in the industry over the last couple of years for true network intelligence. Network intelligence can take operators from that just-in-case approach to a more efficient “just in time” approach to planning their network. This means they can minimize capex by providing complete network visibility and sophisticated analytics to manage current network resources and carefully plan future builds. Experience has shown that such techniques have enabled some operators to safely increase their aggregate network utilization from 60 percent to more than 85 percent of capacity. Network intelligence can also reduce opex by providing consistent routing policies to enforce least-cost network routing of traffic across the network that helps minimize the use of costly third-party capacity. And, the end-to-end visibility and trending of network utilization can dramatically reduce the risk of outages and help operators identify and address capacity utilization hot spots faster.

Network operators are beginning to realize concrete benefits with network intelligence. For example, Cable & Wireless in the United Kingdom has announced savings of $3 million in its network operations in the first year of deployment with such an approach.

Network intelligence will only become more important as wireless voice and data use grows. In fact, Informa estimated last year that wireless data revenue would grow 77 percent over five years and require network capacity increases of 1,088 percent. To meet these needs, network operators will need to get smart about their networks. An effective network intelligence system can help them lower opex and capex and provide the reliable coverage worthy of the claims their marketing department makes.

Leonard Sheahan is senior director, product marketing for Oracle Communications, where he oversees the network intelligence solutions area. He has more than 17 years of experience in the market positioning, development and deployment of flexible, high-performance service fulfillment applications into communications providers. His experience is drawn from numerous customer and strategic partner engagements on a global basis.