* Stone Energy uses AT&T for data, voice and dedicated Internet access services
Stone Energy, a Lafayette, La., oil and gas company, has squeezed huge savings out of its monthly IP network charges by consolidating links with one ISP.
Stone Energy’s all-IP network has 1,000 users located in the company’s main offices in Lafayette, New Orleans, Denver and Houston. The network also supports remote users located on production platforms in the Gulf of Mexico, the Rocky Mountains and the plains of Wyoming.
Until recently, Stone Energy used a mix of ISPs for its network links, which range from private lines to microwave and VSAT links.
“We were farming it out to different companies depending on where we were headed with the circuit,” says David Kennedy, director of IT for Stone Energy. “Some areas we were using AT&T, but in other areas AT&T was more expensive and we found cheaper links from someone else.”
A year ago, Kennedy started to see equilibrium in pricing in most of the markets where Stone Energy does business. At that point, he started negotiating with various ISPs including AT&T, Bell South and SBC to find one carrier that could provide all of the company’s local, long-distance and data services.
Ultimately, Stone Energy chose AT&T. Stone Energy awarded AT&T a three-year, $1 million contract to provide data, voice and dedicated Internet access services https://www.att.com/news/2005/07/07-2
“All the carriers came in with very competitive bids,” Kennedy says. “Our concern with the other carriers is that once again we’d be getting into a reseller-type of position. For example, Bell South has no long-haul data network of its own. They use somebody else’s network. With AT&T, we have some assurance that if the traffic is passed off to other networks, it’s still on a backbone that’s whole-owned and controlled by AT&T. That helps us sleep at night.”
By consolidating all of its network services with AT&T on one master contract, Stone Energy is saving around 20% per month, Kennedy says.
At the same time, Stone Energy has increased its bandwidth to support a new data back-up and recovery application that allows the company to mirror important data at three locations.
“Now we have DS3s on all the main links between our major sites to support this storage-area networking and back-up strategy,” Kennedy says.
Kennedy’s advice to other IT executives who are using a mix of ISPs is to try and get a better deal by consolidating network services. “Shop the ISPs,” he recommends. “They get real aggressive if you come back to them with competitive bids.”
While Kennedy is excited about the cost savings from consolidating his network services with AT&T, he says his top three priorities for the company’s network are reliability, interoperability and security. He says all three of these priorities pushed him towards AT&T.
“Historically, when other carriers have come and gone, AT&T has remained,” Kennedy says. “AT&T has long reach. They can get in and work with just about anybody. And in some of the remote locations where we work, there are still local, privately owned telephone companies. These companies are more willing to open up and work with AT&T.”
Kennedy says the pending merger between AT&T and SBC doesn’t worry him much.
“I’m a customer of both,” he says. “In Houston, we don’t have the option of AT&T local service, so we’re with SBC. SBC has a good, progressive business model. Out of all of the Baby Bells, I’m happiest with them buying AT&T.”
Despite his comfort level with AT&T, Kennedy chose to award a three-year contract with the ISP rather than a longer-term deal.
“Four years is too long, and two years is too short,” Kennedy says. “Three years is long enough to give you a better discount on the pricing. But it’s short enough that you’re not getting locked into technology that would hurt you in the long term.”
