Skip Links

Network World

  • Social Web 
  • Email 
  • Close

(Comma separation for multiple addresses)
Your Message:

Gartner: IT will waste $100 billion on network overspending

By Neal Weinberg , Network World , 10/12/2006
  • Share/Email
  • Tweet This
  • Comment
  • Print

ORLANDO - IT will waste an estimated $100 billion over the next five years by overspending on network products and services.

That was the startling message delivered by Gartner analysts Mark Fabbi and Bob Hafner at a Gartner Symposium IT Expo presentation on network design. Fabbi created quite a buzz at the spring IT Expo when he told IT execs that Gigabit Ethernet to the desktop was a $10 billion waste of money.

Is Gartner right? Discuss in our forum.

He expanded on that premise this week to argue that network execs should only buy what they know they will need for the next two years, rather than buying more than necessary, just in case network requirements grow. More often than not, "just in case never comes," Fabbi said.

He added that companies should use WAN optimization tools to reduce network traffic, rather than purchase more bandwidth. According to Fabbi’s calculations, WAN optimization tools can slash traffic by 60% to 80%. Of course, bandwidth needs will still grow by 35% a year, but when you factor that in, the use of WAN optimization will allow a company to defer the purchase of additional bandwidth for 3.5 years.

Top CIO priorities:
1.Improve business processees.
2.Control costs.
3.Manage customer relations.
4.Achieve competitive advantage.
SOURCE: SURVEY OF GARTNER CLIENTS
Click to see:

Even though companies consider bandwidth to be cheap, mainly because they’re comparing today’s prices with what they were paying for private lines or frame relay, bandwidth is still a significant expense, Fabbi argues. He said companies could save $20 billion by tackling bandwidth costs.

Hafner added that companies should avoid spending money on things like IP phones with large display screens. He said it makes more sense to buy the cheaper phone and take the $150 to $350 savings and use that money on unified communications applications that will make employees more productive.

Hafner said if you’re looking for a large display, it makes more sense to deploy a softphone that ties into the PC monitor. In fact, Hafner said that within 5 to 10 years, desk phones will be gone forever, so he’s recommending against making a huge investment in physical phones.

Another key area where companies can save money is by doing what Fabbi calls "bandwidth arbitrage," which means that instead of running all WAN traffic over a service provider’s MPLS network, think about a hybrid approach that pushes more traffic over the public Internet. "The performance is not that different," Fabbi argues.

He also says companies can save as much as $15 billion over five years by playing hardball with vendors. Fabbi said companies which currently never look at alternatives to their current vendors should take a whole new approach that involves "making the vendors earn their business."

Finally, Fabbi and Hafner say IT execs who save a big chunk of money on things like bandwidth should use that money on technologies like application acceleration, unified communications, mobility and voice over WLAN. "Don’t focus on a better network," said Hafner. "Focus on a better business."

  • Share/Email
  • Tweet This
  • Comment
  • Print

Partner Content

Blue Stripe Software

www.bluestripe.com/

Improving Application Performance Troubleshooting

Diagnosing why an application is slow is hard, at times taking days or weeks to isolate and resolve. This paper explains the challenges involved using current management tools, provides a 'wish list' for application management and analysis, and explains the need for an application system-wide approach that monitors entire applications, not components.

Download Whitepaper

Virtual Vigilance: Managing Application Performance in Virtual Environments

This paper highlights the impact of virtualization on application performance.  "Managing Application Performance in Virtual Environments" states: "Best-in-Class organizations are predominately taking actions around improving visibility across both physical and virtual systems, assessing the business impact of application performance and understanding interdependencies of applications in virtualized environments."

Download Whitepaper

Application Service Requests: The Missing Link for Pragmatic ITSM

Forrester Research analyst Glenn O'Donnell and BlueStripe co-founder Vic Nyman discuss a breakthrough approach to application problem management. Learn the new approach for ITSM problem management, which provides: Rapid isolation of application slow-downs to specific components for quick problem resolution, 24/7 monitoring for proactive notification of potential issues before end users are impacted and much more.

Register for Webcast

Comment
Login
Forgot your account info?
Add comment
Anonymous comments subject to approval. Register here for member benefits.
Have a NetworkWorld account? Log in here. Register now for a free account.

Videos

rssRss Feed