Partnerships between telecos and systems integrators must be encouraged

A new report on global managed service contracts for the first six months of 2015 from consultancy firm Ovum reveals that telecoms network operators offering global managed services are still majoring on connectivity. The report concluded that they have not got closer to the end-user; they have not penetrated the LAN, and they provide limited applications management or support.

Ovum looked at 63 global managed network contracts announced by AT&T, BT, Cable & Wireless, NTT Com, Orange Business Services, T-Systems and Verizon during the first half of 2015.

Of the 63 contracts analysed, the financial details of only 21 of the contracts were made public. According to Ovum, AT&T and BT took by far the largest financial share.

Ovum estimated the combined value of the 63 operator contracts to be $3.48bn, calculated on the value of the 21 known contracts as $2.87bn. The figure was based on the average value for disclosed deals of $14.6m.

AT&T accounted for 12 of the contracts, followed by Verizon Business with 11 contracts, BT had 10, and T-Systems had nine contracts.

The report’s findings show that networked IT has not yet resulted in the traditional international managed networking business of global operators being subsumed into a larger ICT package put together by system integrators.

The report concluded that the future of combined global network and applications management deals clearly needs to involve partnerships between telcos and IT services providers.