Critical capabilities us wireline telecom services 3.12.13

Critical Capabilities for U.S. Wireline Telecom Services Page 1 of 21

Critical Capabilities for U.S. Wireline Telecom
Services
12 March 2013 ID:G00246282

Analyst(s): Danellie Young, Robert F. Mason, Daniel O'Connell

VIEW SUMMARY

Network managers and sourcing professionals need to evaluate wireline telecom service vendors by
specific product capabilities and use cases. Use this research to assess providers' offerings and the
vendors of such services as Multiprotocol Label Switching, Session Initiation Protocol and Ethernet.

Overview
Key Findings
Execution (e.g., service delivery and postsales support) and quality are key differentiators for
wireline providers.
Pricing is becoming more disciplined and less deal-specific for voice and virtual private network
(VPN) services, because discounting is now more consistent.
Providers are starting to respond to strong enterprise demand for Ethernet services; however,
their offerings are still immature. Network managers are also pushing Ethernet adoption further
down market to supplant legacy access that is less flexible and reliable.
Nearly all service providers support large, midsize and branch office use cases, but deployment
costs and pricing models vary; focused providers aggregate more broadband alternatives, offering
broader coverage and more comprehensive customer premises equipment programs.

Recommendations
Network managers and sourcing professionals that need a deep bundle of wireline services should
focus on using Tier 1 providers, because they support more services.
If you need select capabilities, consider Tier 2 vendors where they compete aggressively. These
providers' prices are often 15% lower than those of Tier 1 providers, offer superior customer
support and are ideal for midsize enterprises.
Although this research covers larger, regional and national providers, evaluate smaller regional
network service providers (NSPs) for smaller regional WANs or in-region optical connectivity.

What You Need to Know
This document was revised on 25 March 2013. For more information, see the Corrections page.

http://www.gartner.com/technology/reprints.do?id=1-1EO067X&ct=130326&st=sb 4/4/2013


As WAN technology matures, service provider differentiation has shifted from strictly the technical
capabilities to service delivery, change management and the quality of postsales support, essentially © 2013 Gartner, I
from order entry and design to implementation, trouble reporting and amelioration. As providers bring reserved. Gartner
additional efficiencies from their sales operations and consolidate back-office systems and personnel, Inc. or its affiliate
account team responsiveness has become a focus area. reproduced or
prior written perm
Gartner's seven critical capabilities for vendor evaluation provide criteria to help network planners this publication ha
to be
develop a shortlist of vendors and select the services that best meet their specific organizational and
accuracy,
networking requirements. Use the scoring of these vendors as part of an objective selection process. and shall have no
Buyers should weight criteria according to their own business, technology, and operational inadequacies in su
requirements and plans for their enterprise network architectures. consists
organization and s
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and funds that ha
Wireline telecom services remain foundational for the enterprise, supporting the connectivity needed to in Gartner researc
include
manage all converged applications that transit two or more sites. Increasing enterprise reliance on
research is produc
infrastructure as a service (IaaS) and software as a service (SaaS), as well as reliable third-party organization witho
connectivity, magnify the critical role that WANs play. funds
independence and
However, as enterprises determine how best to support these dynamic network needs, questions arise “Guiding Principles
about how to manage disparate users, locations and devices more effectively and efficiently. This is
especially important as WAN service prices and service margins continue to erode. With less revenue,
NSPs have reduced support personnel, resulting in lapses in ongoing performance and trouble
resolution. This has reduced customer satisfaction, as seen in both JD Powers surveys and Gartner's
client inquiries. Because wireline telecom services represent as much as 20% of an enterprise's IT
budget, network strategists and managers must make prudent decisions concerning the contracting,
procurement and management of voice and data networks and services.

This research provides a way for telecom managers and sourcing professionals to evaluate which NSPs
are best-suited for providing specific services in the context of relevant use cases. This research
examines the vendors' wireline voice and data services that support real-time and non-real-time
applications. Specific applications and nontraditional wireline services — e.g., cloud, data center and
unified communications — are assessed in other research.

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Product Class Definition
For this Critical Capabilities assessment, Gartner defines NSPs offering wireline services specific to the
U.S. as entities that provide telecommunication service for fixed, voice and/or data, and all their
variations (video is included in data) for purchase and use by enterprises. The focus is on assessing a
carrier's ability to provide these services directly to midsize and large enterprises, in single-service and
multiservice WAN (i.e., blended or "hybrid") fashion. Although this research does not evaluate
consumer services and products, the extent to which the providers participate in these areas is taken
into account in applicable select criteria, such as financial viability.

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Critical Capabilities Definition
To help clients determine which providers can best meet their requirements, Gartner has identified
seven key areas of critical capabilities:

MPLS Services — Multiprotocol Label Switching (MPLS) is a private Layer 3 IP networking
service, based on label-switched paths, that offers class of service (CoS) attributes. MPLS can be
delivered over a variety of last-mile access types, including DS-1 and DS-3 access, fiber and
copper-based Ethernet access, broadband/DSL and wireless/3G/4G.
SIP Trunking/IPTF/On-Net Voice — Session Initiation Protocol (SIP) trunking consists of
virtual voice trunks, typically sold as concurrent calls delivered over an IP network (most
enterprise-class offerings rely on MPLS). SIP trunking consists of call paths delivered over private
or public IP tributaries, while traditional voice leverages time division multiplexing (TDM)
infrastructures. Not surprisingly, SIP trunking is less mature than MPLS, Primary Rate Interface
(PRI) and public switched telephone network (PSTN) services. Traditional on-net voice services
use dedicated DS-1/DS-3 access to the NSP, bypassing the switching and feature functions of the
local phone company altogether.
Dedicated Internet — Dedicated Internet includes traditional point-to-point Internet capacity
from the carrier's public IP backbone. These services are typically available from subrate T1 up to
10 Gbps port speeds.
Metro Private Line (SONET, Wavelength, Ethernet) — High-bandwidth private line
connectivity includes Synchronous Optical Network (SONET), wavelength and Ethernet services to
interconnect regional endpoints. These services include both point-to-point and multipoint
connections, with speeds as fast as 10 Gbps.
Managed and Redundant Broadband — Aggregated and managed NSP broadband connectivity
includes ADSL, SDSL, cable and satellite.
Ethernet WAN — Carrier Ethernet solutions include point-to-point, point-to-multipoint and
multipoint services, with port speeds ranging from 1 Mbps to 10 Gbps. They support the easy
sharing of data-intensive documents and enhance collaboration across geographically dispersed
teams. These services include Ethernet Private Line, Ethernet Virtual Private Line and Virtual
Private LAN Service.
Managed Routers — Management of routers on the customer premises provides a range of
functionality extending from "monitor and notify" through full physical and logical management.

For each of these service areas, Gartner has factored in providers' ability to execute, in-service delivery
and postsales customer support, technology, price competitiveness and coverage/reach. Ratings were
determined based on relative strength against similar services from other providers, as well as relative
maturity in the market.

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Use Cases
This research identifies a set of characteristic use cases (see Table 1) that group product capabilities to
fit specific enterprise requirements:

Overall — This is the general enterprise use case with a neutral weighting that serves as the
baseline.
Large Enterprise (Unmanaged) — This buyer is a business with more than 1,000 employees
and buys a combination of voice and data services. This buyer prefers to use transport-centric
WAN and telecom services (versus those proactively managed), and manages customer premises
equipment (CPE) internally. The buyer has elected to monitor WAN connectivity and performance,
and to notify the NSP in the event of performance degradation. This buyer is typically highly
technically competent and/or routinely makes many granular changes in CPE or telecom services.



Large Enterprise (Managed) — This buyer may be a purchaser of voice or data services, but is
looking for the solution, including the router, to be managed by the provider. This buyer is defined
as a business with more than 1,000 employees.
Midsize Enterprise — This buyer is defined as a business with between 500 and 999 employees,
is in the market for voice or data services, and is typically self-managed.
Hybrid WAN Network — This is an enterprise topology that relies more heavily on a mix of
Internet VPN and MPLS, rather than focusing solely on private WAN services (MPLS and Ethernet).
Branch Office — These wireline services require the branch office to connect with other corporate
sites, often including the headquarters or a data center. A typical branch office supports 25 to 50
employees.

Table 1. Weighting for Critical Capabilities in Use Cases

Critical Product Total Large Large Midsize Hybrid Branch
Capabilities Enterprise Enterprise Enterprise WAN Office
Unmanaged Managed Network

MPLS 40.0% 40.0% 35.0% 30.0% 20.0% 15.0%

SIP Trunking, IPTF 25.0% 30.0% 25.0% 25.0% 25.0% 20.0%
and Dedicated
Voice

Dedicated Internet 10.0% 10.0% 10.0% 15.0% 25.0% 20.0%

Metro (SONET, 10.0% 12.0% 10.0% 3.0% 3.0% 0.0%
Wavelength and
Ethernet)

Managed and 7.0% 3.0% 5.0% 13.0% 15.0% 20.0%
Redundant
Broadband

Ethernet WAN 5.0% 5.0% 5.0% 10.0% 12.0% 7.0%

Managed Routers 3.0% 0.0% 10.0% 4.0% 0.0% 18.0%

Total 100% 100% 100% 100% 100% 100%
Source: Gartner (March 2013)

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Inclusion Criteria
Products covered in this research come from vendors included in prior Gartner research and are based
on carriers discussed in inquiries. The following criteria were used to qualify vendors for inclusion in this
research:

Previous year (FY11) U.S. revenue — More than $250 million
Percentage of network-oriented revenue — More than 25% derived from enterprise-class
transport services, such as MPLS
Retail revenue (versus wholesale) — More than 50%
Minimum percentage of U.S.-based retail revenue — 25%
Percentage of enterprise-oriented retail revenue — More than 10%



Percentage of enterprise clients — More than 10%
Enterprise-dedicated sales force — Required
Enterprise hardware sold (e.g., routers or IP PBXs) — Required

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Critical Capabilities Rating
Each of the service offerings that meet our inclusion criteria has been evaluated on several critical
capabilities (see Table 2 and Figure 1), on a scale from 1.0 (lowest ranking) to 5.0 (highest ranking).

Table 2. Product Rating on Critical Capabilities

Product Rating AT&T CenturyLink Level Sprint tw Verizon Windstream XO
3 telecom

MPLS 4.5 3.5 3.5 4.0 3.0 4.0 3.0 3.5

SIP Trunking, IPTF and 4.0 3.0 3.5 3.5 2.5 4.0 2.5 3.5
Dedicated Voice

Dedicated Internet 4.5 4.0 4.5 4.0 3.5 4.5 3.0 3.5

Metro (SONET/ 5.0 3.5 3.5 3.5 4.0 4.5 2.5 3.5
Wavelength/
Ethernet)

Managed and 4.5 2.5 1.0 3.0 1.0 4.0 2.0 2.0
Redundant Broadband

Ethernet WAN 4.5 3.5 3.5 1.0 3.5 4.0 3.0 3.5

Managed Routers 4.0 3.0 3.0 3.5 3.0 4.0 3.0 3.0

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Figure 1. Overall Score for Each Vendor's Product Based on the Nonweighted Score for Each Critical
Capability




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To determine an overall score for each product in the use cases, the ratings in Table 2 were multiplied
by the weightings shown in Table 1. These scores are shown in Table 3.

Table 3. Product Score in Use Cases

Use Cases AT&T CenturyLink Level Sprint tw Verizon Windstream XO
3 telecom

Overall 4.4 3.3 3.4 3.4 2.9 4.1 2.8 3.4

Large Enterprise 4.4 3.3 3.5 3.4 3.0 4.1 2.8 3.4
Unmanaged

Large Enterprise 4.4 3.3 3.4 3.4 2.9 4.1 2.8 3.4
Managed

Midsize Enterprise 4.4 3.2 3.3 3.5 2.8 4.1 2.7 3.2

Hybrid WAN Network 4.4 3.2 3.3 3.5 2.8 4.1 2.6 3.2

Branch Office 4.4 3.1 3.1 3.5 2.7 4.1 2.6 3.1




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Product viability is distinct from the critical capability scores for each product. It is our assessment of
the vendor's strategy and its ability to enhance and support a product throughout the product's
expected life cycle; it is not an evaluation of the vendor as a whole. Four major areas are considered:

Strategy
Support
Execution
Investment

Strategy includes how a vendor's strategy for a particular product fits in relation to the vendor's other
product lines, its market direction and its business overall. Support includes the quality of technical and
account support, as well as customer experiences with that product. Execution considers a vendor's
structure and processes for sales, marketing, pricing and deal management. Investment considers the
vendor's financial health and the likelihood of the individual business unit responsible for a product to
continue investing in it. Each product is rated on a five-point scale from poor to outstanding for each of
these four areas, and it is then assigned an overall product viability rating (see Table 4).

Table 4. Product Viability Assessment

Vendor/Product AT&T CenturyLink Level Sprint tw Verizon Windstream XO
Name 3 telecom

Product Viability Excellent Good Good Good Good Good Good Good

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The weighted capabilities scores for all use cases are displayed as components of the overall score (see
Figure 2).

Figure 2. Vendors' Product Scores for Overall Use Case




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Figure 3 shows the large enterprise unmanaged use case.

Figure 3. Vendors' Product Scores for Large Enterprise Unmanaged Use Case




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Figure 4 shows the large enterprise managed use case.

Figure 4. Vendors' Product Scores for Large Enterprise Managed Use Case




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Figure 5 shows the midsize enterprise use case.

Figure 5. Vendors' Product Scores for Midsize Enterprise Use Case




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Figure 6 shows the hybrid WAN network use case.

Figure 6. Vendors' Product Scores for Hybrid WAN Network Use Case




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Figure 7 shows the branch office use case.

Figure 7. Vendors' Product Scores for Branch Office Use Case




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Vendors
AT&T
AT&T: Average Product Rating, 4.4; Overall Use Case, 4.4

Financial strength and diameter of product portfolio continue to be important attributes for AT&T, as
enterprise clients balance cost optimization with the increasing criticality of private and public WAN
connectivity. AT&T has a strong presence in high-capacity networking across wavelength, SONET and
metro Ethernet offerings. It has targeted private data services for both midsize and large enterprises.
Although AT&T has done better than its peers in service delivery in 2012, many Gartner inquiry
customers continue to demand that AT&T be more responsive to network upgrade requests, including
physical and logical port changes.

AT&T's overall rating reflects its depth of product capabilities across the portfolio and explicit strengths
in such areas as metro and optical networking and managed broadband, where competitors' offerings
are not as mature or as broadly deployed. Enterprises of all sizes should strongly consider AT&T for all
of the key use cases presented in this research (see Table 5).

Table 5. Critical Capabilities Rating for AT&T's Networking Services



Critical Capability Product/Service Name and Brief Description Rating

MPLS AT&T leads with AVPN, and offers PNT for smaller domestic enterprises and 4.5
managed EVPN. Rich offerings in features and reach, including support for 4G
Long Term Evolution (LTE).

SIP Trunking/ Robust suite over the MPLS and IP service networks that fully integrates with 4.0
IPTF/Dedicated Voice unified communications (UC), IPTF, contact centers and conferencing. Dense
metropolitan service area (MSA) coverage for traditional voice.

Dedicated Internet Consistent, high-performing network, with speeds up to 10 Gig. Excels at 4.5
attaching Internet services to colocation and hosting, as well as managed
gateways.

Metro (SONET, Portfolio includes GigaMAN, DecaMAN, switched services along with EPLS- 5.0
Wavelength, MAN OPT-E-WAN for out-of-footprint requirements.
Ethernet)

Managed and Provides ADSL, SDSL, ADSL2+, VDSL, Cable and MIS via 1,700 providers to 4.5
Redundant support managed VPNs, Wi-Fi deployments and wireless backup.
Broadband

Ethernet WAN Offers Ethernet Private Line, Switched Ethernet and Virtual Private LAN 4.5
Service (VPLS) services on a metro, national and global scale.

Managed Routers Flexible management options for all networking services, with a strong base 4.0
of referenceable large enterprise deployments.

CenturyLink
CenturyLink: Average Product Rating, 3.3; Overall Use Case, 3.3

CenturyLink's business services portfolio consists of legacy Qwest MPLS, Ethernet, IP voice and
managed services. CenturyLink's acquisitions have provided it with a more mature IP network service
portfolio, with sufficient coverage to address the midsize to large enterprise market. With numerous
announcements in 2012 regarding integrated cloud, high-capacity network architecture, IP, CoS
enhancements, and newly developed voice and data bundles, CenturyLink has remained fairly active in
new capabilities.

Despite internal reorganizations and business unit integration, Gartner continues to hear from clients
that CenturyLink's customer service and overall services performance appear to be steady and
consistent. CenturyLink's overall use case rating reflects coverage across most key product categories
and effective execution, especially in midsize VPN deployments. Higher-rated competitors exhibited
more market traction with advanced services and more visible penetration in the large enterprise
market, as evidenced by Gartner inquiries.

Midsize enterprises with primarily U.S. sites should consider CenturyLink, because they are likely to find
strong portfolio breadth, competitive rates, and consistent support and performance (see Table 6).

Table 6. Critical Capabilities Rating for CenturyLink's Networking Services


MPLS Breadth of services to appeal to various price points and service-level 3.5
tolerances.




SIP Trunking/ Enhancements to SIP continue, while its hosted voice over IP (VoIP) offering 3.0
IPTF/Dedicated Voice has been expanded to include the BroadSoft platform, with both a hosted
and a fully managed solution.

Dedicated Internet Full range of Internet speeds from Fractional T1 up to 10 Gig. 4.0

Metro (SONET, Portfolio includes traditional SONET-based and Ethernet over SONET 3.5
Wavelength, Ethernet) interfaces, Optical Wavelength and metro Ethernet services.

Managed and DSL is offered as a Layer 3 access option for a private MPLS environment 2.5
Redundant Broadband via Megapath. Satellite access is offered through partnerships with Hughes
and Spacenet.

Ethernet WAN VPLS is available globally for Layer 2 Ethernet capabilities. 3.5

Managed Routers Complete suite of managed services is available throughout its markets. 3.0

Level 3 Communications
Level 3 Communications: Average Product Rating, 3.2; Overall Use Case, 3.4

With the completion of the Global Crossing acquisition, Level 3 has rationalized its product portfolio and
its go-to-market strategy to focus consistently on enterprise (versus wholesale) customers. Level 3
finds itself with a broad wireline suite that encompasses traditional voice and TDM, as well as more-
strategic IP-based services. Level 3 has also demonstrated success with high-capacity services that
require "always on" responsiveness for customers in the financial services sector that typically have a
great deal of technical expertise. Overall, its execution is good, and customers are experiencing
consistent postsales customer support.

Although Level 3's network is growing globally, most of its customers continue to look to Level 3
primarily for U.S. requirements, often while sourcing from a secondary provider to meet footprint
needs. Level 3 lags in providing the breadth of managed and redundant broadband solutions that are
being offered by some of its competitors. Midsize enterprises should consider Level 3 for all transport
services. Large enterprises should consider Level 3 for targeted services, especially SIP trunking and
dedicated Internet (see Table 7).

Table 7. Critical Capabilities Rating for Level 3's Networking Services


MPLS Competitive MPLS offering, including comprehensive portal capabilities. Level 3.5
3 targets healthcare, finance and manufacturing through its vertical
strategy.

SIP Trunking/ Leverages leading-edge SIP technology with TDM voice capabilities. Gaining 3.5
IPTF/Dedicated Voice traction and visibility in several large enterprise accounts in 2012, and
actively transitioning TDM voice customers.

Dedicated Internet Global Internet reach and scalability. 4.5

Metro (SONET, Complete set of private line, wavelength and Ethernet transport for low- 3.5
Wavelength, Ethernet) latency requirements. Metro services always delivered via third-party
agreements.




Managed and DSL access offered for networking services. 1.0
Redundant Broadband

Ethernet WAN Ethernet Virtual Private Line (EVPL) and VPLS available with a wide range of 3.5
speeds and bandwidth configurations.

Managed Routers Support for Cisco and Adtran CPE equipment via third party, Presidio. 3.0

Sprint
Sprint: Average Product Rating, 3.2; Overall Use Case, 3.4

Client feedback was consistently positive in 2012 for Sprint, as was its ability to deliver a consistent
customer experience, although Sprint's ability to acquire new customers is less prominent. Sprint's
focus continues to be primarily on wireless services; however, it has increased its investment in the
wireline business by 53% in 2012. Sprint is often chosen as a secondary or backup provider for wireline
services, particularly for data services. Wireline renewals remained strong in 2012 for midsize accounts,
with VPN customers extending their footprint and adding services such as SIP trunking. There is
renewed interest in Sprint's international services.

Sprint touts its single sales face and customer care support team for both wireless and wireline
services, which improves the end-to-end experience for the full range of services. With little or no
owned access facilities, Sprint relies heavily on third-party access for service delivery. With its
impending acquisition by Softbank, Sprint and its customers may see greater investment and focus on
its wireline assets and services. Enterprise clients that are looking for standard MPLS and Internet,
along with voice services, will find Sprint a strong choice, although Sprint's lack of an available Ethernet
WAN capability hurts its composite score (see Table 8).

Table 8. Critical Capabilities Rating for Sprint's Networking Services


MPLS Simplistic pricing approach, with CoS included for all ports. All access 4.0
into the MPLS cloud is via third parties.

SIP SIP trunking and SIP toll-free offered. 3.5
Trunking/IPTF/Dedicated
Voice

Dedicated Internet Expansive IP network, with rich Web reporting and self-service portals, 4.0
consistent with Sprint's WAN services.

Metro (SONET, Metro Private Line, SONET and Wavelength are offered for very high 3.5
Wavelength, Ethernet) bandwidth requirements.

Managed and Redundant Business DSL and wireless for primary and secondary connectivity. 3.0
Broadband Early entrant carrier to offer 3G/4G to wireline services.

Ethernet WAN Dedicated and aggregated Ethernet access, with speeds ranging from 1.0
2M to 1,000M is plentiful. Sprint offers a broad range of fractional
subrates. High-speed Wave private line services (10G, 40G, 100G) are
planned, but are not currently available.




Managed Routers Simple pricing, with one worldwide rate per device for all domestic and 3.5
global locations. Consistently available across the networking services
globally, although lower attach rate to WAN than its larger peers.

tw telecom
tw telecom: Average Product Rating, 2.9; Overall Use Case, 2.9

Gartner has found tw telecom squarely focused on its customers' core networking requirements, with
priority on its high-speed circuits and services in the U.S. Customer interest in MPLS continues to grow,
and competition with the larger global vendors has become more common. The company continues to
grow its on-net business, building footprint in the regions it supports. It continues to engage in custom
builds where sufficient customer demand exists, with reasonable execution against the promised due
dates. The company continues to shine with its Ethernet portfolio and its rich application-aware
functionality. Midsize enterprises with U.S. locations should consider tw telecom for local and long-haul
MPLS and Ethernet, or for backup data services (see Table 9).

Table 9. Critical Capabilities Rating for tw telecom's Networking Services


MPLS Coverage in major MSAs, with owned infrastructure; however, its lack of 3.0
deep coverage in secondary markets limits the ability of tw telecom to
match competitive offers.

SIP Trunking/ Rich SIP trunking suite available, although no IP toll-free; tw telecom offers 2.5
IPTF/Dedicated Voice traditional PSTN toll-free connection over its SIP trunk access.

Dedicated Internet Dedicated IP backbone, with T1 up to 10 Gbps access options available. 3.5

Metro (SONET, Wide range of TDM services — from T1 to OC-192, wavelengths at 2.5G 4.0
Wavelength, Ethernet) and 10G. E-LINE also available from 2 Mb to 10 Gig.

Managed and Wireless access strategy using 3G/4G is offered to provide a disaster 1.0
Redundant Broadband recovery option. No consumer broadband service such as xDSL or cable
modem available.

Ethernet WAN E-LAN and VPLS offered over its fiber network. 3.5

Managed Routers Managed services available for WAN services. No a la carte management 3.0
available.

Verizon
Verizon: Average Product Rating, 4.1; Overall Use Case, 4.1

Verizon continued to deliver a broad range of transport solutions in 2012, gaining significant traction on
private IP services over LTE, which is a growing alternative to wired broadband. SIP trunking and IP toll
-free services have also been differentiators for Verizon in key vertical industries, such as finance,
healthcare and utilities. Although Verizon gets consistently strong feedback for the quality of presale
design and engineering, Gartner customers continue to report frustration with service delivery of high-
bandwidth connectivity, as well as network availability in large multisite deployments, which is reflected
in their lower scores. Enterprises of all sizes should strongly consider Verizon for each of the key use



cases presented in this research; however, midsize enterprises may find better responsiveness and
pricing from smaller carriers (see Table 10).

Table 10. Critical Capabilities Rating for Verizon's Networking Services


MPLS Private IP provides expansive reach in the U.S. and beyond, offering rich 4.0
features and capabilities, including dynamic bandwidth and a wide range of
access.

SIP Trunking/ Verizon offers VoIP to its U.S. customers in more than 360 local metropolitan 4.0
IPTF/Dedicated markets by leveraging its local switches/infrastructure. In areas in which it lacks
Voice a local footprint, it offers only offer long-distance service.

Dedicated Internet Full breadth of port speeds on a dedicated IP backbone. 4.5

Metro (SONET, Point-to-point solutions at speeds from OC3 to OC192 on a metro basis, 4.5
Wavelength, between local access and transport area (LATA) and internationally. 1G, 2.5G,
Ethernet) and 10G waves as unprotected (linear) or protected point-to-point or hub and
end-link service are also available. SONET rings are available at speeds of OC3
to OC192.

Managed and Verizon delivered DSL and partner broadband services, such as ADSL, SDSL and 4.0
Redundant cable broadband services, are delivered by partners, such as Covad (Megapath)
Broadband and New Edge Networks.

Ethernet WAN VPLS and EVPL are available in the U.S. as part of the Verizon Ethernet WAN 4.0
Services, offering point-to-point, point-to-multipoint and multipoint Layer 2 VPN
configuration options.

Managed Routers A range of managed devices is supported in-house, with a variety of 4.0
management options available.

Windstream
Windstream: Average Product Rating, 2.7; Overall Use Case, 2.8

After successfully rolling up a series of regional competitive local-exchange carrier (CLEC) businesses,
Windstream completed the acquisition of PAETEC. It has now added a concerted focus on enterprise
services, along with a larger footprint designed to meet the needs of the higher education market. The
company does not have the network density or the broad portfolio of services typical of the leaders
covered in this research, but it has sought service differentiation via simplification. Targeted at small
and midsize businesses (SMBs), the IP Simple offering is an example of this approach, delivering fully
managed VoIP services, including transport, CPE, handsets and call control platforms for a per-seat
rate.

Windstream continues to gain traction with midsize enterprises, although it has still has challenges with
service delivery, as evidenced by Gartner inquiries. Windstream should be considered primarily by
midsize enterprises looking for competitive voice and data services. Large enterprises should consider
Windstream for redundant Internet or backup data services (see Table 11).

Table 11. Critical Capabilities Rating for Windstream's Networking Services




MPLS Recognized by Gartner customers as a viable MPLS WAN and voice supplier to 3.0
midsize enterprises; however, it has less traction in large enterprise data
opportunities, as evidenced by Gartner inquiries.

SIP Trunking/ Windstream's MSA coverage is comprehensive for most U.S. enterprises, and 2.5
IPTF/Dedicated the product portfolio includes both SIP trunking and IPTF services. Although
Voice visible in midsize VoIP opportunities Windstream has not demonstrated as
much traction in VoIP services with large enterprises, as observed through
Gartner inquiries.

Dedicated Internet Windstream offers a full range of dedicated Internet connectivity. Service 3.0
delivery and presales technical expertise have challenged Windstream in 2012
for this category, as observed in Gartner inquiries.

Metro (SONET, Fiber presence is more concentrated in the eastern U.S., with limited optical 2.5
Wavelength, capillarity outside major market cities.
Ethernet)

Managed and Windstream has deployed account-specific implementations of DSL access to 2.0
Redundant MPLS, but does not have a standard offering in this area that is specific to DSL,
Broadband cable or satellite.

Ethernet WAN A combination of network-to-network interfaces (NNIs) and owned 3.0
infrastructure enables Windstream to reach customers with a range of Ethernet
offers. VPLS is available, but not via partner NNI extensions.

Managed Routers Attachment of managed routers is below the peer group average. Although its 3.0
portal capabilities are being enhanced, they do not offer the level of reporting
detail provided in competitive offerings.

XO Communications
XO Communications: Average Product Rating, 3.2; Overall Use Case, 3.4

This company has penetrated midsize enterprises and several key large enterprises with a
comprehensive set of transport offers and some of the industry's most straightforward contract
vehicles. In the large enterprise segment, XO has been especially visible in wavelength and SIP
trunking services, and competes aggressively on a combination of price, service integration and
postsales execution. Although XO uses partners in its SIP solution, it has the advantage of deployment
flexibility and depends less than its larger peers on legacy voice services infrastructures. Its composite
score stems from good marks for network services, although it is below average on managed and
redundant broadband, as well as support for managed routers.

Midsize and distributed enterprises should strongly consider XO for voice and data, while large
enterprises should focus on XO offerings for dedicated Internet, SIP trunking and optical interconnect
(see Table 12).

Table 12. Critical Capabilities Rating for XO's Networking Services


MPLS This vendor is less visible than its larger peers in large enterprise MPLS 3.5
contracts, but it continues to succeed in midsize (fewer than 50 sites)
VPN deals, especially hybrid WAN networks.




SIP This vendor has gained traction in several key verticals with its SIP 3.5
Trunking/IPTF/Dedicated offering. Unlike many of its competitors, XO does not mandate its own
Voice VPN transport as a precondition for deploying its SIP services.

Dedicated Internet It competes on a combination of price and converged services to 3.5
deliver dedicated Internet to midsize enterprises and a growing
number of large enterprises.

Metro (SONET, Wavelength, Competing aggressively on price and geographically targeted 3.5
Ethernet) connectivity, XO has secured wavelength contracts with several large
financials.

Managed and Redundant This vendor does not actively pursue managed broadband 2.0
Broadband opportunities as part of an MPLS extension or hybrid WAN strategy,
nor does it leverage its fixed wireless network.

Ethernet WAN This vendor leverages Ethernet over copper and a set of NNI 3.5
relationships to deliver Layer 2 services in the U.S. market as
tributaries as low as 3 Mb/s.

Managed Routers Managed routers are attached to approximately one-third of all XO 3.0
MPLS circuits (primarily monitor and notify), which is slightly below the
market average.

Critical Capabilities Methodology
Critical capabilities are attributes that differentiate products in a class in terms of their quality and
performance. Gartner recommends that users consider the set of critical capabilities as some of the
most important criteria for acquisition decisions.

This methodology requires analysts to identify the critical capabilities for a class of products. Each
capability is then weighted in terms of its relative importance overall, as well as for specific product use
cases. Next, products are rated in terms of how well they achieve each of the critical capabilities. A
score that summarizes how well they meet the critical capabilities overall, and for each use case, is
then calculated for each product.

Ratings and summary scores range from 1.0 to 5.0:

1. = Poor: Most or all defined requirements not achieved
2. = Fair: Some requirements not achieved
3. = Good: Meets requirements
4. = Excellent: Meets or exceeds some requirements
5. = Outstanding: Significantly exceeds requirements

Product viability is distinct from the critical capability scores for each product. It is our assessment of
the vendor's strategy and its ability to enhance and support a product over its expected life cycle; it is
not an evaluation of the vendor as a whole. Four major areas are considered: strategy, support,
execution and investment. Strategy includes how a vendor's strategy for a particular product fits in
relation to its other product lines, its market direction and its business overall. Support includes the
quality of technical and account support, as well as customer experiences for that product. Execution
considers a vendor's structure and processes for sales, marketing, pricing and deal management.
Investment considers the vendor's financial health and the likelihood of the individual business unit
responsible for a product to continue investing in it. Each product is rated on a five-point scale from



poor to outstanding for each of these four areas, and it is then assigned an overall product viability its website,
rating.

The critical capabilities Gartner has selected do not represent all of the capabilities of any product.
Therefore, they may not represent those that are most important for a specific use situation or business
objective. Clients should use a critical capabilities analysis as one of several sources of input about a
product before making an acquisition decision.

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