The main problems today's service providers face are not a surprise to anyone who works in the telecom industry. They have been discussed and rehashed for the past year in the media, at conferences and in internal meetings. A recap:

•  Budget constraints as service providers try to be competitive and meet customer requirements.
•  Budget constraints of end users who ultimately purchase these services.
•  How to reach new customers that don't already purchase their services.
•  How to add new service offers to existing customers' portfolio.
•  How to enable all of this without major network overhauls.

As I already mentioned, none of this is particularly new news. What is new is the opportunity for resolving these problems via IP Services.

Just a few years ago, IP services primarily consisted of transport-based IP service offerings including Internet access, site-to-site VPNs, and remote access VPNs. In today's environment, these transport-oriented IP services are table stakes for service providers to compete. Service providers can build more intelligence into these services as well as introduce enhanced security options to create differentiation and ultimately improve profitability.

The next-generation of differentiated IP services, called high-touch services, are application- and content-aware or -enabled. Through policies, the service provider can develop and introduce services tailored for specific applications, content, IP addresses, source and destinations, time of day, and other parameters. The policies may include the access or denial to specific applications/content, bandwidth guarantees, application of different qualities of service, enforcement of specific security parameters, etc. Furthermore, the next-generation of IP services would apply these policies dynamically and automatically on a per-subscriber and/or per-session level.

Service providers can also create differentiation with the launch of prepackaged services for specific applications such as Internet telephony and video-on-demand. Packaged services may target specific vertical and/or horizontal markets such as campus environments, residential power users, and others.

View from the service provider

The opportunity for a service provider who wishes to offer network-based IP solutions is to layer these services on top of the services they already offer in order to enhance their product portfolio. For example, many providers already offer managed CPE services in conjunction with dedicated connectivity options. These solutions for the most part are aimed at larger enterprises. Usually these customers have an internal support staff that wishes to maintain some level of control and management of the solution required. Because some level of "hands on" interaction is required from the enterprise itself, these solutions are not feasible for most small and midsize enterprises.