SLO, SLA or SL$?

At the end of the day we have to decide: Will it be SLO, SLA or SL$?

Marty DavidsonAs the demands of Wall Street and budgetary challenges continue to apply pressure on MSOs, cable operators searching for new sources of significant revenue have been moving more and more into the commercial business services space.

Operators have been in the business services arena for varying lengths of time, but now they are really focusing on moving upmarket into the truly mid-size businesses. For example, Comcast CFO Michael Angelakis recently stated at a Citi investment conference that Comcast had identified a segment of the market that is commercial businesses with fewer than 20 employees.

While that segment is worth $2 billion, the total market – including businesses of up to 500 employees – could be $10 billion to $15 billion. There are a host of services that are supplied to these customers, such as Metro-E – be it fiber- or coax-based – voice – PRI or hosted – cell backhaul, and SIP services like peering. The expectations from these types of customers are significantly different from those of small businesses, and cable operators will need to prepare themselves accordingly. The question is: What should engineering and operations teams really be preparing for?

One area of investigation is in minimizing the quote-to-cash cycle. Sales representatives and finance teams want return on their capital investment and realization of revenue and commissions as quickly as possible, so there is incredible focus on reducing the cycle time from the sale to the install to the “turn up” so that billing can begin. Sales teams are not plant design experts, so technical engineering solutions must be developed to optimize the quoted sales times and improve their accuracy. Important factors to consider are: accurate fiber maps and wavelengths; precise router configurations, so as not to introduce degraded service levels due to effects such as latency; the likelihood of sales personnel providing accurate delivery times, especially considering plant build-out; and rights of entry and permitting. This complex set of factors requires a new level of critical “system thinking,” as outlined in this space last July by Daniel Howard.

But for an operator, it doesn’t stop there. Maintenance, repair, network performance and measurement must also be considered. Is there a new criterion needed to aid engineers in determining which maintenances should be performed, and when and how often, as it relates to business customers? How does or should MTTR change with customer and by product? What level of performance should an operator target? Are new benchmarks needed? This is the new world where customers demand high-performance networks, and cable operators have to respond. Could these challenges be solved by generating a Monte Carlo computational algorithm? That would be ideal in a perfect and static world, but reality suggests otherwise. What about a cohesive and agreed-upon measurement methodology? Needed or necessary? Indeed!

No matter what, all discussions should lead to the customer. Customer expectations will continue to be highly dynamic, and a service provider that can differentiate itself from the competition will significantly aid the sales forces in closing more sales and retaining more customers. Depending on the type of commercial customer, operators can offer service agreements of many flavors and levels:

• A service-level objective, or SLO, which may exist as an internal operations guideline, but with no documented indenture.

• A contractual service-level agreement, or SLA, that may be put in place and would provide the customer with contractual escape clauses or penalties for egregious performance. There are SLAs that do also include some financial penalties for performance.

• A third type of agreement is purely focused on delivering proficient results that enable businesses to succeed. With these types of agreements, financial penalties are incurred for performance below an established and agreed-upon level – what could affectionately be called a SL$. A key consideration – and the subject of considerable debate – is the concept of proactively crediting customers who experience outages or degraded services, whether they actually notice theses performance anomalies or not.

As the foray into more and larger businesses continues, SCTE is moving full force into providing standards, best practices, training and certifications for commercial services. For example, following the success of SCTE’s highly regarded “Broadband Premises Installation and Service Guidebook,” development of business services certification and training materials is in the works. Following hot on the heels of these materials are primers, video snippets, and even a pocket guidebook. In addition, SCTE’s Standards Group is keenly focused on performance measurement methodology and service levels as it applies to best practices and standards.

We all know that commercial business services are a different world filled with unique and challenging requirements, but just how heterogeneous to traditional cable operations it will be in the future is exhilarating. The opportunity to separate ourselves from the competition is here. Let’s band together to really transform peoples’ perception of cable service providers. Batten down the hatches and prepare for some fun. Partnering together, the cable commonwealth will be riding this wave to the shore.