Cisco Cisco Virtual Managed Services 2.0 White Paper

The Expanding Opportunities Within Virtual Managed Services

White Paper

Cisco Public

The Study

The scope of this study consisted of a look into 6

countries, 17 industry verticals, and 12 company-

size segments, ranging from fewer than 50 to

10,000-plus employees. Roughly three-quarters of

the 2600 respondents were decision makers in their

enterprise; one-quarter were involved in network

and managed services purchases.

The study created a picture that reflects the

multidimensional, flexible evolution of network,

security, and collaboration services. From this

picture, we can make reasonable predictions about

how many enterprises will reshape their business

landscapes with virtualized business network and

security services.

General Findings: The Hybridization and

Extension of Networks

Two factors affected the choices made by

businesses that employ some form of wide-area

network (WAN) to link up branches, work sites, and

mobile workers. Like most of the world’s industries

and services are experiencing, the growth of data

has increased Internet traffic and required the

proliferation of network functions, and this requires

wider and more abundant access links. As traffic

increases, more businesses are relying on hybrid

links to keep traffic flows separate and up to

speed. Increasingly, this requires a combination of

Multiprotocol Label Switching (MPLS) and managed

Internet services. These managed services

represent a multilayered opportunity for providers.

Customers that operate within WAN networks

represent an important opportunity to provide not

just the basic elements of a virtual platform, but

also the attendant services—security, cloud, data

aggregation, and collaboration—that businesses

require. Third-party management remains a

common solution for enterprises looking for service,

speed, and security. To provide either the hybrid

linkage model or a fully developed cloud-based

delivery system, an emerging concept—VMS—

will become critical to overcoming limitations in

traditional managed service models.

VMS presumes that the remote, cloud-based

functionality exists either in concert with on-

premises-based capabilities or as the exclusive

source of a company’s primary network and

security functions.

VMS: The Basic Concept and Delivery

Most traditional managed network and security

services control the placement of customer

premises equipment (CPE) onsite; this can include

routers, firewalls, and other hardware components.

CPE is essential to all the functions that businesses

almost take for granted (that is, a router for network

connectivity, a firewall device for security, and so on).

In its most basic iteration, VMS engages CPE

devices either remotely from a cloud or from a

hybrid of on-premises-based and cloud-based/-

delivered capabilities.

Like all virtual services, this new approach to

essential business functions makes the enterprise

faster and more reactive, without compromising

security or restricting the custom features of

network services. The benefits extend to the

businesses, their customers, and service providers

as well.

In its current formation, VMS inherits some of the

challenges of traditional managed service solutions

and presents a new set of challenges that providers

will be expected to overcome. The opportunity

presented by following the virtual shift will justify the

challenges for many service providers.

Pain Points Inherited from Traditional Managed

Service Models

Our survey respondents were consistent in

identifying the deficits that have defined traditional

managed services to date, such as:

•

High monthly costs

•

Inflexible network configurations, which restrict

adaptability and the adoption of new networking

protocols

•

Rigidity around services; many companies

prefer to test services and components before

committing to delivery

What Customers Seek Most from a

VMS-Based Approach

The respondents to our study highlighted flexibility,

speed of virtual solutions, and especially remote

visibility as their chief benefits because of:

•

Faster availability/access to the latest networking

features/capabilities