IT executive Tom Giannetti faced a difficult but common problem. He needed to upgrade from modem connections to broadband services at 350 retail locations across the country.

Trying to find the right coverage from multiple service providers proved “too labor intensive and cost prohibitive,” says Giannetti, who is vice president of IT for the El Pollo Loco restaurant chain. Instead, he hired virtual network operator (VNO) MegaPath to piece together broadband services from a variety of providers.

Click to see: Tom Giannetti

While some network executives might say he’s loco for giving up control over his WAN links, Giannetti believes he’s crazy like a fox. “Hiring a VNO enabled El Pollo Loco to deploy broadband services in hundreds of restaurants without increasing internal IT staff,” he says.

And the migration was a mission-critical move that afforded El Pollo Loco measurable gains. For instance, patrons now wait less than two seconds — rather than 10 to 12 seconds — for credit card transaction approval.

Midsize businesses such as El Pollo Loco are the bread-and-butter of VNOs, which are defined as WAN services vendors who do not own their own facilities.

“VNOs can offer higher levels of customer service and customization than larger network-owning players. Each customer is that much more important to a VNO, especially the midsize customer, which typically isn’t the focus of the global telecom players,” says Jan Dawson, vice president of enterprise practice for market-research firm Ovum.

The original appeal of VNOs was that they offered to take over the dizzying prospect of negotiating contracts with foreign carriers and the painful process of dealing with stacks of invoices and intricate billing procedures from multiple vendors.

That’s still true, but these days VNOs are adding enterprise services to lure larger customers. Many are serving up security and network-management offerings, such as IP, MPLS and SSL VPN access options. They also are offering intrusion prevention and related endpoint security services to help companies manage mobile workers.

“The availability of enhanced services certainly contributed to our move in the direction of a VNO contract,” Giannetti says.

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